Terns Pharma's $650M Raise: Fueling a New Challenge in Oncology

FOSTER CITY, CA – December 10, 2025 – In a powerful display of investor confidence, clinical-stage oncology firm Terns Pharmaceuticals has priced an upsized public offering expected to gross $650 million. The move comes just days after the company unveiled highly encouraging clinical data for its lead drug candidate, TERN-701, sending its stock soaring and signaling a strategic acceleration in the competitive cancer treatment landscape.

This is not just another financing round; it's a strategic war chest. The offering of 16,250,000 shares at $40.00 each, managed by a syndicate of top-tier investment banks including Jefferies, TD Cowen, and Leerink Partners, provides Terns with the capital to aggressively advance its pipeline. The transaction underscores a pivotal moment for the company, solidifying its recent strategic pivot to focus squarely on oncology and arming it for the costly late-stage development and potential commercialization of what it hopes will be a transformative therapy for Chronic Myeloid Leukemia (CML).

From Data to Dollars: The Catalyst Behind the Capital

The timing of the capital raise is no coincidence. The market's enthusiasm, which saw Terns' stock (Nasdaq: TERN) surge over 37% on December 9th, was ignited by new data from the Phase 1 CARDINAL trial presented at the prestigious American Society of Hematology (ASH) 2025 annual meeting. The results for TERN-701, a highly selective, allosteric BCR-ABL inhibitor, were not just positive; they were compelling enough to suggest a potential paradigm shift in CML treatment.

The data revealed that TERN-701 achieved a 64% major molecular response (MMR) rate by 24 weeks in heavily pre-treated CML patients, a population with high baseline disease burden. This response rate climbed to an impressive 75% in patients receiving doses of 320 mg or higher. Critically, these deep molecular responses were observed early and were accompanied by a favorable safety profile.

What truly sets TERN-701 apart, and what likely captured investor attention, is its differentiation from its main competitor, Novartis's Scemblix (asciminib). While both are allosteric inhibitors, Terns reported that TERN-701 demonstrated a lack of pancreatic toxicity and clinically meaningful hypertension—side effects that have been noted with asciminib. Furthermore, the CARDINAL study showed that patients previously treated with asciminib experienced a significant recovery of molecular control when switched to TERN-701. This suggests a distinct biological mechanism that could offer a new line of defense for patients who have exhausted other options, lending significant credence to the company's claim of a 'best-in-disease' profile.

Fortifying the War Chest for a Competitive Market

With gross proceeds of $650 million—potentially more if underwriters exercise their option to purchase additional shares—Terns is transitioning from a promising clinical-stage biotech to a formidable development powerhouse. Prior to the offering, the company held $295.6 million in cash and equivalents as of September 30, 2025. This new infusion dramatically extends its operational runway, effectively de-risking the financial path through pivotal trials and regulatory submissions.

According to the company, the net proceeds are earmarked for the full spectrum of late-stage development: funding advanced clinical trials, scaling up manufacturing capabilities, and laying the groundwork for a potential commercial launch of TERN-701. This capital ensures that funding will “not be an issue,” as one analyst noted, for critical upcoming milestones, including meetings with the FDA to map out a Phase 3 study.

The financing also cements a crucial strategic pivot. In October 2025, Terns announced it was shelving its oral GLP-1 agonist program for metabolic diseases after Phase 2 data failed to show a sufficiently differentiated profile. The decision, while disappointing for that program, sharpened the company’s focus on its oncology assets. This $650 million raise is a resounding affirmation of that oncology-first strategy, channeling nearly a billion dollars in total cash reserves toward challenging established players like Novartis and Bristol Myers Squibb in the multi-billion-dollar CML market.

Reading the Market: A Barometer for Biotech Confidence

Terns' ability to execute an upsized offering speaks volumes about the current state of the biotech investment landscape. While the broader market can be volatile, investors are clearly willing to make significant bets on companies with strong clinical data and a clear path forward in high-need areas like oncology. The company's stock performance has been nothing short of meteoric, with a year-to-date surge of over 770% driven almost entirely by the promise of TERN-701.

While some technical indicators, like the Relative Strength Index (RSI), suggest the stock is in overbought territory, the flood of capital indicates that institutional investors are looking past short-term metrics to the long-term disruptive potential. The involvement of a blue-chip underwriting syndicate provides an additional layer of validation, signaling to the market that Terns’ science and strategy have withstood rigorous due diligence.

This transaction serves as a bellwether for the sector, demonstrating that innovation backed by robust data can unlock substantial capital. For Terns, the infusion is transformative. It allows the company to negotiate from a position of strength, accelerate its development timelines, and prepare for a market entry that could offer new hope to CML patients. With a fortified balance sheet and compelling clinical evidence, Terns Pharmaceuticals is now positioned not just to compete, but to potentially redefine the standard of care in a challenging oncology market.