Royalty Pharma Plc · NASDAQ:RPRX
Royalty Pharma — Q4 2021 Earnings Presentation
30 slides from Royalty Pharma's earnings presentation, Feb 15, 2022
Slide 1: Royalty Pharma
ROYALTY PHARMA
Slide 2: Q4 and Full Year 2021 Financial Results
Royalty Pharma plc Q4 and Full Year 2021 Financial Results February 15, 2022 2
Slide 3: Forward Looking Statements & Non-GAAP Financial Information
Forward Looking Statements & Non-GAAP Financial Information This presentation has been prepared by Royalty Pharma plc (the “Company”), is made for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy securities. The information set forth herein do
Slide 4: Agenda
Agenda Key Highlights Pablo Legorreta Founder & Chief Executive Officer Portfolio Update Jim Reddoch EVP, Co-Head of Research and Investments & Chief Scientific Officer Royalty Acquisitions Marshall Urist EVP, Co-Head of Research and Investments Financial Results Terrance Coyne EVP, Chief Financial
Slide 5: Key Highlights: Pablo Legorreta
Key Highlights Pablo Legorreta Founder & Chief Executive Officer 5
Slide 6: Key 2021 accomplishments reflect strong business momentum
Key 2021 accomplishments reflect strong business momentum • FY 2021 Adjusted Cash Receipts (top-line)(1) growth of 18% Financial • FY 2021 Adjusted Cash Flow (bottom-line)(1) growth of 19% • Further strengthened balance sheet, including inaugural social bond issuance • Announced $3.0 billion ($2.3 b
Slide 7: Delivering double-digit growth in Q4 and FY 2021
Delivering double-digit growth in Q4 and FY 2021 Adjusted Cash Receipts(1) Adjusted Cash Flow(1,2) ($ in millions) ($ in millions, except per share amount) quarter/quarter +12% 543 488 +15% 484 423 $0.80/share $0.70/share Q4 2020 Q4 2021 Q4 2020 Q4 2021 +19% 1,767 2,129 1,483 year/year 1,800 +18% $2
Slide 8: Track record of impressive growth since June 2020 IPO
Track record of impressive growth since June 2020 IPO Adjusted Cash Receipts(1) Adjusted Cash Flow(1) ($ in millions, year/year growth) ($ in millions, year/year growth) $2.1bn (+18% y/y) $1.8bn (+19% y/y) +24% +15% $587 $488 +12% +37% $543 +12% +9%(2) $524 +22%(2) +16% +12%(2) +3% $441 +24%(2) $484
Slide 9: Existing portfolio powered 18% growth in 2021 despite LOEs
Existing portfolio powered 18% growth in 2021 despite LOEs 2021 Adjusted Cash Receipts (non-GAAP)(1) ($ in millions) 0 +18% +14% +4% 71 2,129 426 2,058 1,800 (168) Key drivers: Key drivers: Cystic Fibrosis Tremfya Nurtec ODT(2) Cabometyx Imbruvica Oxlumo Promacta 2020 Adjusted Cash Receipts Royalty
Slide 10: Portfolio Update: Jim Reddoch, PhD
Portfolio Update Jim Reddoch, PhD Executive Vice President Co-Head of Research and Investments, Chief Scientific Officer 10
Slide 11: Announced $3.0 billion of royalty transactions in 2021
Announced $3.0 billion of royalty transactions in 2021 2021 Royalty Pharma investment activity > 300 initial reviews ~85 CDAs signed 61 in-depth reviews 33 proposals submitted Executed 5 transactions for $3.0bn(1) (Acquired royalties on 10 therapies) Maintained strong financial discipline: ~4% of in
Slide 12: Positive market backdrop supports strong pipeline trends
Positive market backdrop supports strong pipeline trends Strong growth in initial reviews Opportunity set increasing Robust royalty acquisition activity Initial reviews In-depth reviews Transaction value(1) +50% +53% +37% >300 61 $3.0bn >265 50 $2.4bn $2.2bn >200 40 2019 2020 2021 2019 2020 2021 201
Slide 13: Enhancing long-term growth with transformative therapies
Enhancing long-term growth with transformative therapies Transactions announced in 2020 and 2021 Approved therapies $5.5bn Total announced value 20 Unique therapies 8 Development-stage therapies at acquisition 5 Areas of therapeutic focus Development-stage therapies 9 Current and potential future bl
Slide 14: Royalty Acquisitions: Marshall Urist, MD, PhD
Royalty Acquisitions Marshall Urist, MD, PhD Executive Vice President Co-Head of Research and Investments 14
Slide 15: Impressive early performance of recent transactions
Impressive early performance of recent transactions(1) Current approved therapies Development-stage therapies Percent change in 2025 consensus sales(2) since acquisition Therapy Marketer Key upcoming events 53% zavegepant Biohaven Oral Phase 3 results in Q4 2022(4) 51% BCX9930 BioCryst Pivotal studi
Slide 16: Tailored funding solutions throughout partner’s growth journey
Tailored funding solutions throughout partner’s growth journey 1. December 2020: $125m to support Orladeyo launch for royalties on Orladeyo 1. June 2018: $150m to support pipeline development in exchange for Nurtec and BCX9930(1) ODT royalties and Biohaven equity(3) 2. November 2021: $200m to suppor
Slide 17: Expanding partnership with Cytokinetics
Expanding partnership with Cytokinetics Aficamten consensus sales(7) • Funding in total of up to $450m with $100m in upfront payments Up to $150m for aficamten synthetic royalty – 4.5% up to $1.0bn in 1,474 sales and 3.5% for >$1.0bn in sales(1) Up to $300m commercial launch capital with $50m up
Slide 18: Multiple important milestones expected in 2022
Multiple important milestones expected in 2022 Select expected upcoming events 2022 Q1 Q2 Q3 Q4 Trodelvy Phase 3 results for 3L+ HR+/HER2 mBC(1) Cabometyx, Opdivo, Yervoy Phase 3 results for 1L RCC (COSMIC 313)(2) Tremfya Phase 2b/3 results for Ulcerative Colitis (QUASAR)(3) Xtandi Phase 3 results f
Slide 19: Financial Results: Terrance Coyne
Financial Results Terrance Coyne Executive Vice President Chief Financial Officer 19
Slide 20: Total Royalty Receipts grew 5% in Q4 and 11% in FY 2021
Total Royalty Receipts grew 5% in Q4 and 11% in FY 2021 Selected key products Q4 2021 FY 2021 Royalty Receipts(1) Growth Royalty Receipts(1) Growth ($ in millions) (% year/year) ($ in millions) (% year/year) CF Franchise 196 24 702 27 94 2 369 7 89 4 353 10 49 18 174 21 41 5 158 8 DPP-IV Franchise 3
Slide 21: Strong Adjusted Cash Flow conversion in Q4 and 2021
Strong Adjusted Cash Flow conversion in Q4 and 2021 $ in millions (except per share amount) Q4 2021 % change % ACR FY 2021 % change % ACR Royalty Receipts 659 5% 2,609 11% Distributions to non-controlling interests -116 -19% -480 -12% Adjusted Cash Receipts (non-GAAP)(1) 543 12% 2,129 18% Operating
Slide 22: Maintaining financial firepower with robust deal activity
Maintaining financial firepower with robust deal activity Cash, cash equivalents & marketable securities • $2.1 billion of cash, cash equivalents and ($ in millions) marketable securities as of December 31, 2021 • Capital deployed of $2.6 billion in 2021 1,767 -2,609 • $1.3 billion gross proceeds fr
Slide 23: Full-year 2022 guidance
Full-year 2022 guidance(1,2) February 15, 2022 Comments • Strong underlying portfolio performance Adjusted Cash Receipts (non-GAAP) $2,225m - $2,300m • Residual impact from end of HIV royalty term in 2021 excluding new transactions(1,2) (+~5% to 8% year/year) • End of DPP-IV royalty term in March 20
Slide 24: Conclusion: Pablo Legorreta
Conclusion Pablo Legorreta Founder & Chief Executive Officer 24
Slide 25: Company formation and innovation create large opportunity
Company formation and innovation create large opportunity Biotech initial public offerings (IPOs) Cumulative spend from today’s unprofitable biopharmas Cumulative operating expense ($ in billions) >3x 1,100 ~$1.1tn in total spend 74 68 over the next decade 47 42 32 21 75 2016 2017 2018 2019 2020 202
Slide 26: Royalty Pharma inaugural Investor Day – May 17, 2022
Royalty Pharma inaugural Investor Day – May 17, 2022 Outlook for royalty funding in life sciences Capital deployment opportunities Long-term growth targets 26
Slide 27: Footnotes
Footnotes 1) To aid in comparability, figures for each fiscal quarter in 2019 are presented on an unaudited pro forma basis, which adjusts certain cash flow line items as if Royalty Pharma’s Reorganization Transactions (as described in the Company’s final prospectus filed with the SEC on June 17, 20
Slide 28: Appendix
Appendix ROYALTY PHARMA 28
Slide 29: Transactions show breadth of TAs and funding capabilities
Transactions show breadth of TAs and funding capabilities Therapeutic areas (2020 – 2021) Type of royalty deal (2020 – 2021) (by number of therapies acquired) (by number of therapies acquired) Immunology Oncology 14% 18% Infectious Disease Synthetic royalties Third-party royalties 5% 36% Neurology 1
Slide 30: Distributions to non-controlling interest (NCI)
Distributions to non-controlling interest (NCI) Fourth quarter 2021 NCI as a Products % of Royalty Receipts • Royalty Pharma includes several non-controlling Cystic fibrosis franchise(1) 17.6% interests in our financial statements. Tysabri 17.6% Imbruvica 17.6% • The largest of these impacting the n