3 Biotech Stocks That Actually Pay Dividends and Keep Raising Them
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Biotech has a reputation for burning cash. Most of the sector’s startups sell new shares to pay for the next clinical trial, and income investors get nothing back. The three companies below do the opposite. They earn enough from approved drugs or drug royalties to pay shareholders every quarter, and each has recently raised its payout. Amgen (NASDAQ:AMGN | AMGN Price Prediction) has the highest yield of the group at 2.16%. For all three, how well the dividend is covered matters more than the size of the yield, so each section below starts with coverage.
Regeneron: Biggest Safety Cushion of the Group
Regeneron Pharmaceuticals (NASDAQ:REGN) produces antibody drugs. Its biggest products are the eczema and asthma drug Dupixent (partnered with Sanofi, NASDAQ:SNY), the eye drug EYLEA HD, and the cancer drug Libtayo. Regeneron pays $0.94 per share each quarter. The next payment goes to shareholders of record on Nov 20 and is paid Dec 3. That works out to a yield of 0.41%, so the income is small. In exchange, this payout has more protection behind it than almost any other in healthcare.
Dividend safety: Regeneron’s trailing dividend of $3.70 per share uses about 8% of its trailing earnings of $45.24 per share. Last quarter alone, the company earned $20.07 per share on a non-GAAP basis, so the $0.94 dividend used less than 5% of it. The balance sheet is mostly equity: $33.5 billion of shareholders’ equity against $44.4 billion in total assets. The company also held $17.82 billion in cash and equivalents at the end of the second quarter. Most of Regeneron’s cash returns go to buybacks. It bought back $2.3 billion of stock through the first nine months of the year and has $2.2 billion of authority left. The dividend record is short. Payments in the data begin with the $0.88 quarterly dividend that went ex-dividend in February 2025. The payout rose to $0.94 this year, up about 6.8%.
Bull case: Third-quarter revenue rose 36.3% to $5.12 billion, and non-GAAP EPS beat the $16.19 consensus by 23.93%. Global Dupixent sales reached $6.54 billion (up 35%). EYLEA HD grew 62%, and Libtayo grew 51%. The fourth quarter will also include a $1.0 billion upfront payment from the expanded Sanofi alliance. CEO Leonard S. Schleifer called it “an outstanding quarter for Regeneron, with Dupixent, EYLEA HD, and Libtayo each achieving record net sales.” The stock trades at 13x forward earnings, compared with 20x trailing earnings. With profits growing that fast and a payout ratio this low, management has a lot of room to keep raising the dividend.
Risk: Sales of the original EYLEA fell 41% as biosimilars and competing drugs took share. Regeneron needs patients to keep moving to EYLEA HD fast enough to make up the difference.
Amgen: Highest Yield, With Free Cash Flow to Back It
Amgen is one of the oldest large biotech companies. It sells cholesterol, bone health, asthma, and cancer drugs, along with a growing line of biosimilars. Its $2.52 quarterly dividend goes ex-dividend on Nov 20 and is paid Dec 11. That gives Amgen a high-yield profile for biotech at 2.16%.
Dividend safety: Amgen paid out about 58% of its trailing GAAP earnings, based on $9.94 in dividends per share against $17.25 in EPS. Measured against non-GAAP results, coverage is firmer. The quarterly dividend took about 39% of third-quarter non-GAAP EPS of $6.45. Free cash flow was $3.654 billion for the quarter, which is more than double the roughly $1.36 billion it costs to pay the dividend on every outstanding share. Free cash flow did fall 13.98% from a year earlier because of working-capital swings. Debt is the weak spot. Amgen has $54.0 billion of debt against $14.352 billion of shareholders’ equity, though that debt is down from $57.3 billion at the end of the second quarter. The company bought back no stock in the third quarter and expects full-year buybacks not to exceed $3.0 billion. That leaves more cash available for the dividend and for paying down debt. Amgen raised the quarterly payout from $2.38 to $2.52, a 6% increase.
Bull case: Third-quarter revenue rose 8.45% to $10.365 billion, and the company raised full-year guidance to $38.9 billion to $39.7 billion in revenue and $22.90 to $23.70 in non-GAAP EPS. Sales of the cholesterol drug Repatha grew 37%, the asthma drug TEZSPIRE grew 43%, and UPLIZNA grew 191%. MariTide, Amgen’s experimental obesity drug, is in Phase III testing. CFO Thomas J. Dittrich said the company “generated $3.7 billion in free cash flow, reflecting continued momentum across the business and enabling us to continue investing for future growth.” The stock trades at 19x forward earnings, compared with 27x trailing earnings.
Risk: Biosimilars are cutting into older drugs. Sales of Prolia fell 45%, and sales of XGEVA fell 47%. Newer drugs have to keep growing quickly to replace that lost revenue.
Royalty Pharma: Steady Raises From Other Companies’ Drug Sales
Royalty Pharma (NASDAQ:RPRX) buys royalties on drugs that other companies sell, then collects a share of those sales. Its Class A shares trade on the NASDAQ. The stock yields 1.37%. The next $0.235 quarterly dividend goes ex-dividend on Nov 13 and is paid Dec 10.
Dividend safety: GAAP earnings make Royalty Pharma’s payout look tighter than it is, because one-time accounting charges swing reported profit from quarter to quarter. Cash flow gives a cleaner read. In the third quarter, the company paid $135 million in dividends against $686 million of operating cash flow, about 20%. Royalty Receipts, the cash the company actually collected from its royalties, were $883 million, and the dividend took about 15% of that. On a GAAP basis, the payout ratio runs near 60%. Debt is about $8.8 billion, down from $9.2 billion in principal at the end of the second quarter. Shareholders’ equity rose to $9.795 billion. Royalty Pharma has paid a dividend every quarter since its first ex-dividend date in September 2020. The quarterly amount has increased every year since, from $0.15 to $0.235. Royalty Pharma raised the payout from $0.22 by about 6.8%.
Bull case: Royalty Pharma raised its full-year Portfolio Receipts guidance to $3.50 billion to $3.55 billion, which means Royalty Receipts growth of 10% to 11%. Royalties on Tremfya rose 61%, Voranigo rose 65%, and Evrysdi rose 38%. The company completed $1.9 billion in transactions this year, adding new royalty flows. CEO Pablo Legorreta said the company “delivered excellent third quarter 2026 results and we again raised our financial guidance.” Because the portfolio covers many drugs, one failed product hurts Royalty Pharma much less than it would hurt a single drug developer.
Risk: Royalties fall when the underlying drugs lose patent protection. Promacta royalties dropped 75% after U.S. generic competition came, so new deals have to keep replacing royalties that are running off.
How These Three Biotech Dividends Compare
All three can fund their dividends without borrowing or selling shares. Regeneron pays the least but has the most room to raise it, with a payout ratio near 8%. Amgen pays the most at 2.16%, and its free cash flow covers the dividend more than twice over. Royalty Pharma sits in between: its dividend uses only a small share of its royalty cash flow, and it has raised the payout every year since 2020.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
