10 Cheap Biotech Stocks to Invest in Now

6. Royalty Pharma plc (NASDAQ:RPRX)

P/E Ratio: 12.38 

Royalty Pharma plc (NASDAQ:RPRX) plays a major role in supporting new drug development and is the biggest buyer of biopharmaceutical royalties. The company works with many partners, such as universities, research hospitals, non-profits, biotech companies, and big pharmaceutical firms.

Royalty Pharma (NASDAQ:RPRX) makes money from royalties on the sales of top therapies in its portfolio, which includes over 35 approved products and 15 drugs still in development. The company reported solid Q3 2024 results on November 6, with a 15% rise in both Portfolio and Royalty Receipts. In 2024, they spent $2.6 billion acquiring royalties on new therapies. Recent additions include royalties for treatments targeting schizophrenia (Cobenfy), glioma (Voranigo), and ulcerative colitis (Tremfya), which are expected to drive future growth.

Royalty Pharma (NASDAQ:RPRX) has solid financial strength, with $3 billion in available resources. This includes $950 million in cash, ongoing cash flow from its business, and access to loans if needed. The company carries $7.8 billion in debt at a low 3.1% interest rate, with an average repayment period of 12 years to match the lifespan of its royalty investments. Its debt level is about three times its adjusted earnings, and it still has $1.8 billion available through unused credit.