Core Insights - Teva Pharmaceuticals has entered a funding agreement with Royalty Pharma to receive up to $500 million for the development of its anti-IL-15 antibody, TEV-'408, which is in early-stage development for vitiligo and other autoimmune diseases [1][2] Funding Agreement Details - The agreement includes $75 million for R&D co-funding of a phase IIb vitiligo study expected to start in 2026, with an option for an additional $425 million to co-fund phase III development based on phase IIb results [2] - Teva will retain rights to the drug while being responsible for milestone payments and ongoing royalties on global net sales if the drug is approved [5][11] Strategic Benefits for Teva - The collaboration with Royalty Pharma strengthens Teva's immunology pipeline, reduces financial exposure, and accelerates the development of TEV-'408, allowing for faster clinical progression [3][4] - Teva's shares have increased by 95% over the past six months, outperforming the industry growth of 54.1% [4] Market Potential - Vitiligo is a chronic autoimmune condition with a global prevalence of 0.5% to 2%, representing a significant unmet medical need due to limited treatment options [7] - TEV-'408 aims to address both the physical and psychosocial burdens of vitiligo by targeting the IL-15 pathway responsible for immune-driven melanocyte destruction [7] Ongoing Research and Development - Teva is also evaluating TEV-'408 in a phase IIa study for celiac disease, which received Fast Track designation from the FDA in 2025 [8] - The current collaboration with Royalty Pharma marks Teva's second agreement, following a previous deal for the development of TEV-'749 for schizophrenia [9]

Core Insights - Royalty Pharma experienced a landmark year in 2025, achieving a top-line growth of 14%-16% and announcing $4.7 billion in royalty transactions, while the royalty market reached a record high of $10 billion [2][3][5]. Company Performance - The company internalized its external manager, leading to cost savings and improved governance, and is on track to meet its 2025 guidance for Portfolio Receipts of $3,200 to $3,250 million [6][7]. - Royalty Pharma achieved a Return on Invested Capital of 15.7% and a Return on Invested Equity of 22.9% on a trailing twelve-month basis [7]. Industry Trends - The royalty funding market saw a 40% increase in total value, reaching $10 billion in 2025, compared to an average of $7.1 billion over the previous five years [3][4]. - Synthetic royalties, a concept pioneered by Royalty Pharma, accounted for $4.7 billion of the total market value, highlighting their growing acceptance in the biopharma capital structure [4][5]. Future Outlook - The company anticipates continued favorable industry conditions in 2026, supported by a robust pipeline of potential transactions and several important milestones in its development-stage portfolio [2][10]. - Royalty Pharma expects to achieve at least $4.7 billion in Portfolio Receipts by 2030, implying a growth rate of 9% or greater from 2025 to 2030 [9]. Development Pipeline - The company’s pipeline includes 20 development-stage therapies, with several expected to achieve pivotal milestones in 2026, including daraxonrasib, litifilimab, and pelacarsen [11][12]. - The late-stage pipeline therapies have the potential for combined peak sales exceeding $43 billion annually, translating to over $2.1 billion in new royalties for Royalty Pharma [12].

Group 1: Collaboration with Royalty Pharma - Teva Pharmaceutical Industries has entered into a collaboration with Royalty Pharma to jointly develop the anti-IL-15 antibody, TEV-408, for the treatment of vitiligo [2] - Royalty Pharma will invest $500 million in the development costs, including $75 million for a phase 2b study set to begin in 2026 [2] - If the trials are successful, Royalty Pharma has the option to invest an additional $425 million for phase 3 trials, and Teva will pay royalties on worldwide sales if the drug is launched [2] Group 2: Financial Forecasts - Teva's revenue guidance for 2025 is projected to be near the lower end of the range at approximately $16.8 billion, with EBITDA expected to be in the middle of the range at around $4.8 billion [4] - For 2026, sales are anticipated to be similar to or slightly lower than 2025, with low single-digit growth expected in 2027 and a mid single-digit compound annual growth rate from 2027 to 2030 [5] - Free cash flow is targeted to exceed $2.7 billion in 2027 and reach over $3.5 billion by 2030, with net leverage expected to fall below two times by 2027 [5] Group 3: Market Performance - Teva has a market capitalization of $36.7 billion, reflecting a 53% increase in its share price over the past year [6] - As of the latest trading session, Teva's share price increased by 0.96%, reaching NIS 105 [6]

Core Insights - Royalty Pharma and Teva Pharmaceuticals have entered into a funding agreement of up to $500 million to support the clinical development of Teva's anti-IL-15 antibody, TEV-'408, aimed at treating vitiligo and other autoimmune conditions [1][3][7] - TEV-'408 is currently in Phase 1b trials for vitiligo and Phase 2a for celiac disease, with preliminary data suggesting its potential as a therapeutic target [1][5][7] Funding Agreement Details - The agreement includes $75 million for R&D co-funding to initiate a Phase 2b study in 2026, with an option for Royalty Pharma to provide an additional $425 million for Phase 3 development based on Phase 2b results [3][7] - If TEV-'408 is approved, Teva will pay a milestone to Royalty Pharma and a royalty on worldwide net sales [3] TEV-'408 Overview - TEV-'408 is a human monoclonal antibody designed to inhibit interleukin-15 (IL-15), which plays a role in immune-mediated pathways [4] - The drug has a high affinity and potency in vitro, with a planned self-administration option for patients [4] Vitiligo Context - Vitiligo is a chronic autoimmune skin disease affecting 0.5% to 2% of the global population, characterized by the loss of pigment-producing cells, leading to significant emotional and psychosocial burdens [6][8] - Current treatment options are limited, with only one approved topical therapy available, highlighting the unmet need for effective systemic treatments [7][8] Company Backgrounds - Royalty Pharma is a leading funder of biopharmaceutical innovation, collaborating with various entities to support late-stage clinical trials and new product launches [9] - Teva Pharmaceutical Industries is transitioning into a leading innovative biopharmaceutical company, focusing on neuroscience, immunology, and complex generics [10]

Core Viewpoint - Teva Pharmaceuticals and Royalty Pharma have entered into a funding agreement of up to $500 million to expedite the clinical development of Teva's anti-IL-15 antibody, TEV-'408, which shows promise in treating autoimmune conditions like vitiligo [1][2][3] Funding Agreement - Royalty Pharma will provide Teva with up to $500 million, including $75 million for a Phase 2b study set to begin in 2026, with an option for an additional $425 million based on Phase 2b results [3][8] - The agreement supports Teva's strategy to accelerate its innovative pipeline and deliver new therapies to patients more efficiently [2][8] Product Overview - TEV-'408 is an investigational human monoclonal antibody targeting interleukin-15 (IL-15), which plays a role in immune-mediated pathways [4][5] - The drug is currently in Phase 1b trials for vitiligo and Phase 2a trials for celiac disease, having received Fast Track designation from the U.S. FDA in May 2025 [5][8] Disease Context - Vitiligo is a chronic autoimmune skin disease affecting 0.5% to 2% of the global population, characterized by the loss of pigment-producing cells, leading to significant emotional and psychosocial burdens [6][7] - Current treatment options for vitiligo are limited, with only one approved topical treatment available, highlighting the need for effective systemic therapies [7][8]

Core Viewpoint - Teva Pharmaceuticals and Royalty Pharma have entered into a funding agreement of up to $500 million to expedite the clinical development of Teva's anti-IL-15 antibody, TEV-'408, which shows promise in treating autoimmune conditions like vitiligo [1][2][3] Funding Agreement - Royalty Pharma will provide Teva with up to $500 million, including $75 million for a Phase 2b study set to begin in 2026, with an option for an additional $425 million based on Phase 2b results [3][8] - The agreement aims to support Teva's strategy to accelerate its innovative pipeline and bring new treatments to patients more quickly [8] Product Overview - TEV-'408 is an investigational human monoclonal antibody targeting interleukin-15 (IL-15), which plays a role in immune-mediated pathways [4] - The drug is currently in Phase 1b trials for vitiligo and Phase 2a trials for celiac disease, having received Fast Track designation from the U.S. FDA in May 2025 [5] Disease Context - Vitiligo is a chronic autoimmune skin disease affecting 0.5% to 2% of the global population, characterized by the loss of pigment-producing cells, leading to significant emotional and psychosocial burdens [6][7] - Current treatment options for vitiligo are limited, with only one approved topical therapy available, highlighting the need for more effective systemic treatments [7]

Core Insights - Royalty Pharma has acquired 100% of the Evrysdi royalty from PTC Therapeutics for $240 million upfront and up to $60 million in sales-based milestones [1][2][3] Group 1: Transaction Details - The acquisition includes a tiered royalty structure of 8% to 16% on worldwide net sales of Evrysdi, with specific rates based on sales thresholds [3] - Royalty Pharma will receive 8% on sales up to $500 million, 11% on sales between $500 million and $1 billion, 14% on sales between $1 billion and $2 billion, and 16% on sales over $2 billion, starting in Q1 2026 [3] Group 2: Product Information - Evrysdi, marketed by Roche, is an oral treatment for spinal muscular atrophy and was approved by the FDA in 2020, treating over 21,000 patients globally [2] - In 2024, Evrysdi generated sales of approximately CHF 1.6 billion ($1.9 billion), reflecting an 18% year-over-year growth at constant exchange rates, with projections of reaching CHF 2.3 billion ($2.9 billion) by 2030 [2] Group 3: Company Overview - Royalty Pharma, founded in 1996, is the largest buyer of biopharmaceutical royalties and funds innovation across the biopharmaceutical industry [5] - The company has a diverse portfolio of royalties from over 35 commercial products, including notable therapies from Vertex, Johnson & Johnson, GSK, and others [5]

Core Insights - Royalty Pharma has acquired the final portion of PTC Therapeutics' royalty on Roche's Evrysdi for $240 million upfront and up to $60 million in sales-based milestones [1] Group 1: Transaction Details - Royalty Pharma will own 100% of the tiered royalty structure ranging from 8% to 16% on worldwide net sales of Evrysdi [3] - The royalty rates are structured as follows: 8% on sales up to $500 million, 11% on sales between $500 million and $1 billion, 14% on sales between $1 billion and $2 billion, and 16% on sales over $2 billion [3] - Royalty Pharma will start receiving the increased royalty rates in Q1 2026 based on Evrysdi sales in Q4 2025 [3] Group 2: Product Information - Evrysdi is an orally administered SMN2 splicing modifier for treating spinal muscular atrophy, approved by the FDA in 2020 [2] - The product has treated over 21,000 patients globally and generated sales of approximately CHF 1.6 billion ($1.9 billion) in 2024, reflecting an 18% year-over-year growth at constant exchange rates [2] - Analyst consensus projects Evrysdi sales to reach CHF 2.3 billion ($2.9 billion) by 2030 [2] Group 3: Company Background - Royalty Pharma, founded in 1996, is the largest buyer of biopharmaceutical royalties and a key funder of innovation in the biopharmaceutical sector [5] - The company collaborates with various entities, including academic institutions and leading pharmaceutical companies, to fund innovation directly and indirectly [5] - Royalty Pharma's portfolio includes royalties on over 35 commercial products and 20 development-stage candidates [5]

Core Insights - Royalty Pharma has acquired a royalty interest in Nuvalent's neladalkib and zidesamtinib for up to $315 million [1][4] - Neladalkib and zidesamtinib are next-generation tyrosine kinase inhibitors (TKIs) targeting specific mutations in non-small cell lung cancer (NSCLC) [2] - Positive pivotal results for neladalkib have been reported, showing durable activity and a well-tolerated safety profile [3] Transaction Details - The acquisition includes a low-single digit royalty on worldwide net sales of both therapies, expected to last until approximately 2041 to 2042 [4] - The total investment for the royalty interest is capped at $315 million [4] Product Development Status - Neladalkib is in a Phase 3 study for TKI-naïve patients, while zidesamtinib is under FDA review with an action date of September 18, 2026 [3] - Analyst consensus projects sales of neladalkib to reach approximately $3.5 billion and zidesamtinib to reach approximately $1.9 billion by 2035 [3] Company Background - Royalty Pharma is the largest buyer of biopharmaceutical royalties and funds innovation across the biopharmaceutical industry [6] - The company has a diverse portfolio that includes royalties on over 35 commercial products and 20 development-stage candidates [6]

Core Viewpoint - Royalty Pharma has acquired a royalty interest in Nuvalent's neladalkib and zidesamtinib for up to $315 million, indicating a strategic investment in promising cancer therapies [1][4]. Group 1: Acquisition Details - Royalty Pharma is acquiring a low-single digit royalty on worldwide net sales for both neladalkib and zidesamtinib, with the expected royalty duration extending through approximately 2041 to 2042 [4]. - The total acquisition cost is up to $315 million, sourced from an undisclosed third party [1][4]. Group 2: Product Information - Neladalkib is being developed for ALK mutation-positive non-small cell lung cancer (NSCLC), while zidesamtinib targets ROS1 mutation-positive NSCLC [2]. - Both therapies aim to provide a best-in-class combination of efficacy and tolerability [2]. - Positive pivotal results for neladalkib have been reported, showing durable activity and a well-tolerated safety profile in TKI pre-treated patients [3]. - Zidesamtinib is under review by the U.S. FDA, with an action date set for September 18, 2026, for TKI pre-treated patients [3]. Group 3: Market Projections - Analyst consensus projects sales of approximately $3.5 billion for neladalkib and $1.9 billion for zidesamtinib by 2035 [3].