The Periodic Table of Royalties
A structural classification of 64 pharmaceutical royalty instrument types
R⟨Base, Seniority, Term, Concentration, Stage⟩
11
500
RN1
Gold standard
R⟨N,1,X,4,0⟩
11 = Complexity number (ZR) -- structural ordering index
500 = Market weight (W) -- typical deal size in $M
RN1 = Symbol -- Group (N = net sales) + Period (1 = safe)
Gold standard = Common name
R⟨N,1,X,4,0⟩ = Structural formula (base, seniority, term, concentration, stage)
Observable ←—— economic base ——→ Engineered
Periodic properties
ZR
Complexity number
Composite score ordering all elements by base abstraction, structural layers, and model dependency. Like atomic number, it uniquely identifies each element and predicts behavior.
W
Market weight
Typical transaction size in $M. Analogous to atomic mass. Ranges from $5M (preclinical milestones) to $500M+ (RPFT portfolio acquisitions and senior ABS tranches).
V
Valence
Combinability into portfolio structures (0-4). V=4 elements like RN1 are ideal building blocks. V=0 elements like RS5 are inert: too unstable to form portfolio bonds.
t½
Half-life
Median duration of cash flows. Patent-expiry royalties have predictable half-lives of 8-15 years. Synthetic structures may have unpredictable decay profiles.
Δ
Ionization energy
Difficulty of separating the royalty from its underlying asset for independent trading. Senior net sales royalties have low Δ. Embedded profit shares have very high Δ.
→ Horizontal trend (across periods)
Left to right: observability decreases, model dependence increases, contractual complexity rises. Gross sales royalties are maximally transparent. Structured/ABS products are maximally engineered. Mispricing potential grows with abstraction.
↓ Vertical trend (down groups)
Top to bottom: idiosyncratic risk increases, variance rises, tail risk expands, payoffs become more convex and option-like. Period 1 elements behave like bonds. Period 5 elements behave like deep out-of-the-money options on regulatory success.
↘ Diagonal instability zone
The staircase diagonal separates observable from engineered claims. Elements near this boundary are the most structurally ambiguous. The bottom-right corner (RS5, RX5) represents maximum opacity combined with maximum uncertainty -- where most mispricing lives.
Capital for Cures AG · p05.org · Periodic Table of Royalties v3.0
Classification framework for analytical purposes. Not investment, legal, or financial advice.