Royalty Pharma (NASDAQ: RPRX) renews $1.8B unsecured revolver to 2031

Rhea-AI Filing Summary

Royalty Pharma plc entered into a new $1.8 billion unsecured revolving credit facility with Bank of America and a syndicate of lenders. This facility replaces the company’s prior revolving credit agreement, and all obligations and commitments under the old facility were fully repaid and terminated at effectiveness.

The new Revolving Credit Facility bears interest at either a base rate tied to prime, federal funds plus 0.5%, or Term SOFR plus 1%, or at SOFR/alternative currency rates plus an applicable margin, with a commitment fee on unused amounts. It matures on May 22, 2031 and includes financial covenants requiring a consolidated leverage ratio at or below 4.00 to 1.00, a portfolio cash flow ratio at or below 5.00 to 1.00, and a coverage ratio at or above 2.50 to 1.00, with slightly higher leverage and cash flow limits following qualifying material acquisitions.

Insights

Credit & capital structure analyst

Royalty Pharma refinances liquidity with a long-dated $1.8B revolver.

Royalty Pharma plc has replaced its prior revolving credit agreement with a new $1.8 billion unsecured facility maturing on May 22, 2031. This extends committed liquidity on an unsecured basis, which can support future royalty purchases and general corporate needs.

The Credit Agreement includes financial covenants based on Adjusted EBITDA, requiring a consolidated leverage ratio at or below 4.00 to 1.00 (4.50 to 1.00 after qualifying acquisitions) and a coverage ratio of at least 2.50 to 1.00. These metrics, along with a portfolio cash flow ratio cap of 5.00 to 1.00 (5.50 to 1.00 post-acquisition), anchor leverage and interest burden.

The interest rate is tied to base rates or SOFR plus an applicable margin, with a commitment fee on unused capacity determined by a pricing grid. Future disclosures in company filings may provide more detail on actual borrowings, pricing levels selected, and compliance with leverage and coverage thresholds over time.

8-K Event Classification

3 items: 1.01, 2.03, 9.01

3 items

Item 1.01 Entry into a Material Definitive Agreement Business

The company signed a significant contract such as a merger agreement, credit facility, or major partnership.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial

The company incurred a new significant debt or off-balance-sheet obligation.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Key Figures

Revolving credit facility size: $1.8 billion Leverage ratio covenant: 4.00 to 1.00 Leverage ratio post acquisition: 4.50 to 1.00 +5 more

8 metrics

Revolving credit facility size $1.8 billion Unsecured revolving credit facility under new Credit Agreement

Leverage ratio covenant 4.00 to 1.00 Maximum consolidated leverage ratio of funded debt to Adjusted EBITDA

Leverage ratio post acquisition 4.50 to 1.00 Maximum leverage ratio following a qualifying material acquisition

Portfolio cash flow ratio 5.00 to 1.00 Maximum consolidated portfolio cash flow ratio

Portfolio cash flow ratio post acquisition 5.50 to 1.00 Maximum portfolio cash flow ratio after qualifying material acquisition

Coverage ratio covenant 2.50 to 1.00 Minimum consolidated coverage ratio of Adjusted EBITDA to interest expense

Facility maturity date May 22, 2031 Stated maturity of the Revolving Credit Facility

Federal funds rate spread 0.5% Base rate component: federal funds rate plus 0.5%

Key Terms

Revolving Credit Facility, consolidated leverage ratio, Adjusted EBITDA, consolidated coverage ratio, +2 more

6 terms

Revolving Credit Facility financial

"The Credit Agreement provides for an unsecured revolving credit facility (the “Revolving Credit Facility”) in an amount equal to $1.8 billion"

A revolving credit facility is a type of loan that a business can borrow from whenever it needs money, up to a set limit. It’s like having a credit card for companies—allowing them to borrow, pay back, and borrow again as needed, providing flexibility for managing cash flow or funding short-term expenses.

consolidated leverage ratio financial

"require us to maintain (i) a consolidated leverage ratio at or below 4.00 to 1.00"

A consolidated leverage ratio measures a business group's total debt compared with its ability to pay, by using combined figures for the parent company and its subsidiaries. Think of it like comparing the total mortgage across all properties you own to your overall income or net worth; investors use it to judge how risky the company’s capital structure is and how vulnerable it may be to rising interest rates or income drops.

Adjusted EBITDA financial

"of funded debt to Adjusted EBITDA, each as defined and calculated with the ratio level"

Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.

consolidated coverage ratio financial

"and (iii) a consolidated coverage ratio at or above 2.50 to 1.00 of Adjusted EBITDA to consolidated interest expense"

Emerging growth company regulatory

"or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company"

An emerging growth company is a recently public or smaller public firm that qualifies for temporary, lighter regulatory and disclosure rules to reduce the cost and effort of being public. For investors, it means the company may provide less historical financial detail and face fewer reporting requirements than larger firms, so it can grow more quickly but also carries higher uncertainty—like buying a promising early-stage product with fewer user reviews.

Alternative Currency Term Rate financial

"or (b) Daily SOFR, the Alternative Currency Term Rate or the Alternative Currency Daily Rate"

Understanding 8-K Material Events →

NY false 0001802768 0001802768 2026-05-22 2026-05-22

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 22, 2026

Royalty Pharma plc

(Exact Name of Registrant as Specified in its Charter)

England and Wales		001-39329		98-1535773
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Identification No.)

110 East 59th Street New York, New York		10022
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (212) 883-0200

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Class A Ordinary Shares, par value $0.0001 per share		RPRX		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

On May 22, 2026, Royalty Pharma plc (the “Company”), Royalty Pharma Holdings Ltd, a non-wholly owned consolidated subsidiary of the Company (“RPH”), and Royalty Pharma Manager, LLC (“RPM”) entered into that certain Revolving Credit Agreement with Bank of America, N.A., as Administrative Agent (the “Administrative Agent”) and the other lenders thereto (the “Credit Agreement”). The Company is the borrower under the Revolving Credit Facility referred to below and RPH and RPM are guarantors under the Revolving Credit Facility. The Credit Agreement refinanced and replaced in its entirety that certain Revolving Credit Agreement, dated as of September 15, 2021, among the Company as Borrower, RPH, the Administrative Agent and the lenders thereto (as amended, restated, amended and restated, supplemented or otherwise modified, the “Existing Credit Agreement”), and at effectiveness of the Credit Agreement, all obligations outstanding under the Existing Credit Agreement were repaid and all commitments under the Existing Credit Agreement were terminated in full.

The Credit Agreement provides for an unsecured revolving credit facility (the “Revolving Credit Facility”) in an amount equal to $1.8 billion that is subject to an interest rate, at our option, of either (a) a base rate determined by reference to the highest of (1) the administrative agent’s prime rate, (2) the federal funds rate plus 0.5% and (3) Term SOFR plus 1% or (b) Daily SOFR, the Alternative Currency Term Rate or the Alternative Currency Daily Rate (each as defined in the Credit Agreement), plus in each case, the applicable margin. There is also a commitment fee payable on the unused portion of the Revolving Credit Facility, the rate of which is determined by a pricing grid. The Credit Agreement that governs the Revolving Credit Facility contains certain customary covenants, that among other things, require us to maintain (i) a consolidated leverage ratio at or below 4.00 to 1.00 (or at or below 4.50 to 1.00 following a qualifying material acquisition) of funded debt to Adjusted EBITDA, each as defined and calculated with the ratio level calculated with further adjustments as set forth in the Credit Agreement, (ii) a consolidated portfolio cash flow ratio at or below 5.00 to 1.00 (or at or below 5.50 to 1.00 following a qualifying material acquisition) and (iii) a consolidated coverage ratio at or above 2.50 to 1.00 of Adjusted EBITDA to consolidated interest expense, each as defined and calculated with further adjustments as set forth in the Credit Agreement. The Credit Agreement includes customary covenants for credit facilities of its type that limit the ability to engage in certain activities, such as entities that are not obligors under the Credit Agreement incurring additional indebtedness, the incurrence of liens and the consummation of certain merger or other fundamental change transactions with respect to obligors under the Revolving Credit Facility. The Revolving Credit Facility will mature on May 22, 2031.

The foregoing summary of the Credit Agreement is qualified by reference to the terms of the Credit Agreement, which is attached hereto as Exhibit 10.1 and is incorporated by reference herein.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information described above under Item 1.01 of this report is incorporated into this Item 2.03 by reference.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

10.1		Revolving Credit Agreement, dated as of May 22, 2026, among Royalty Pharma plc, Royalty Pharma Holdings Ltd, Bank of America, N.A., as Administrative Agent, the other parties thereto, and the lenders and issuing banks from time to time party thereto.
104		Cover Page Interactive Data File (embedded in the cover page formatted in Inline XBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

				ROYALTY PHARMA PLC
Date: May 28, 2026				By:		/s/ Terrance Coyne
						Terrance Coyne
						Chief Financial Officer

FAQ

What did Royalty Pharma (RPRX) announce in its latest 8-K filing?

Royalty Pharma entered a new unsecured revolving credit facility of up to $1.8 billion. The agreement replaces its prior revolver, fully repaying all obligations and terminating commitments under the old facility, and provides committed liquidity through May 22, 2031.

How large is Royalty Pharma’s new revolving credit facility?

The new Revolving Credit Facility provides up to $1.8 billion of unsecured borrowing capacity. This line can be drawn and repaid as needed, subject to the agreement’s terms, interest rates, covenants, and customary limitations on additional indebtedness, liens, and certain merger transactions.

When does Royalty Pharma’s new revolving credit facility mature?

The Revolving Credit Facility matures on May 22, 2031. Until that date, Royalty Pharma can borrow, repay, and reborrow under the facility, provided it complies with the financial covenants, including leverage, portfolio cash flow, and interest coverage ratio requirements set in the Credit Agreement.

What financial covenants apply to Royalty Pharma’s new credit facility?

The facility requires a consolidated leverage ratio at or below 4.00 to 1.00, a consolidated portfolio cash flow ratio at or below 5.00 to 1.00, and a consolidated coverage ratio at or above 2.50 to 1.00, each defined and adjusted as described in the Credit Agreement.

How do qualifying material acquisitions affect Royalty Pharma’s covenants?

Following a qualifying material acquisition, the maximum consolidated leverage ratio increases to 4.50 to 1.00 and the maximum consolidated portfolio cash flow ratio rises to 5.50 to 1.00. These higher limits provide flexibility around larger transactions while keeping covenant tests anchored to Adjusted EBITDA and cash flows.

What interest rate applies to Royalty Pharma’s new revolving credit line?

Borrowings accrue interest at either a base rate tied to prime, federal funds plus 0.5%, or Term SOFR plus 1%, or at Daily SOFR or alternative currency rates, in each case plus an applicable margin, with a commitment fee on unused amounts set by a pricing grid.

Filing Exhibits & Attachments

4 documents

Agreements & Contracts

• EX-10.1 EX-10.1 772.5 KB

Other Documents

• EX-101 XBRL TAXONOMY EXTENSION SCHEMA 3.1 KB
• EX-101 XBRL TAXONOMY EXTENSION LABEL LINKBASE 16.8 KB
• EX-101 XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE 10.6 KB