8-K: Terns Pharma Unveils 2026 Priorities, Strong Cash Position

Terns Pharmaceuticals announced its 2026 priorities and program milestones for TERN-701, alongside a robust unaudited cash position of approximately $1.0 billion extending into 2031.

Summary

• Terns Pharmaceuticals will present its 2026 priorities and program milestones at the 44th Annual J.P. Morgan Healthcare Conference on January 12, 2026.
• The company has transitioned to an oncology focus, anchored by its allosteric BCR-ABL inhibitor, TERN-701, for Chronic Myeloid Leukemia (CML).
• The CARDINAL Phase 1/2 trial for TERN-701 is enrolling well, with multiple important milestones planned for 2026.
• Unaudited cash, cash equivalents, and marketable securities totaled approximately $1.0 billion as of December 31, 2025.
• This financial position is expected to provide a cash runway into 2031, including the first potential approval and launch of TERN-701.
• TERN-701 received U.S. FDA Fast Track designation for the treatment of CML in Q4 2025.
• An upsized public offering completed in December 2025 generated gross proceeds of approximately $747.5 million.

Sentiment

Score: 8

Explanation: The filing presents very strong positive clinical data for TERN-701, a significant extension of cash runway through a successful capital raise, and a clear strategic path forward with key milestones and FDA Fast Track designation. These factors collectively indicate a highly favorable outlook for the company's lead program and financial stability.

Positives

• Unaudited cash, cash equivalents, and marketable securities of approximately $1.0 billion as of December 31, 2025.
• Cash runway is expected to extend into 2031, covering the first potential approval and launch of TERN-701.
• TERN-701 was granted U.S. FDA Fast Track designation for the treatment of CML in Q4 2025.
• Compelling safety and efficacy data from the CARDINAL trial for TERN-701 were presented at ASH in December 2025.
• 87% (55/63) of patients remained on TERN-701 treatment as of the data cutoff in the CARDINAL trial.
• No dose-limiting toxicities were observed in dose escalation, and a maximum tolerated dose was not reached for TERN-701.
• The majority of treatment-emergent adverse events (TEAEs) were low grade with no apparent dose relationship.
• TERN-701 showed an unprecedented efficacy with a Major Molecular Response (MMR) achievement rate by 24 weeks of 75% (18/24) in evaluable patients at the recommended Phase 2 dose range (>320mg QD).
• The MMR rate for TERN-701 is trending 2-3X higher than asciminib in Phase 1 and Phase 3 studies evaluating a 3L+ patient population.
• Deep molecular response (DMR) achievement rate by 24 weeks was 36% (10/28).
• Encouraging MMR rates were observed in patients with prior asciminib (n=10), with an overall MMR rate of 60% (6/10).
• Enrollment in the CARDINAL Phase 1/2 study has accelerated, with over 85 patients enrolled as of December 8, 2025.
• The company successfully completed an upsized public offering in December 2025, generating gross proceeds of approximately $747.5 million.

Risks

• Risks associated with the initiation, cost, timing, progress, results, and utility of current and future research and development activities and preclinical studies and clinical trials.
• Forward-looking statements are subject to uncertainties that could cause actual results and the implementation of plans to vary materially.

Future Outlook

Terns Pharmaceuticals anticipates selecting a pivotal dose for TERN-701 and engaging in an End of Phase 2 regulatory interaction with the U.S. FDA by mid-2026. Updated and expanded CARDINAL data is expected by the second half of 2026, with the initiation of the first pivotal trial (2L+ population) planned for late 2026 or early 2027. The company's approximately $1.0 billion in cash, cash equivalents, and marketable securities is projected to fund operations into 2031, covering the first potential approval and launch of TERN-701. The company is also pursuing discovery efforts for undisclosed oncology targets and seeking a strategic partner for its TERN-501 and TERN-801 metabolic programs.

Management Comments

• "Last year was transformative for Terns as we completed our transition to an oncology company anchored by our allosteric BCR-ABL inhibitor, TERN-701, for CML."
• "Following compelling TERN-701 data at ASH in December, and our subsequent capital raise, we are in a strong position to advance TERN-701 towards pivotal trial initiation."
• "Based on accelerating momentum in our CARDINAL trial, our goal for pivotal trials is to enroll patients more quickly than historical precedents in CML and to generate data that further strengthen the position of TERN-701 as a potential best-in-disease therapy across all lines of CML treatment."
• "We believe that reaffirming clinical differentiation and advancing to product launch rapidly will be key factors to maximize the therapeutic and commercial potential of TERN-701."

Industry Context

Terns Pharmaceuticals is positioning TERN-701 as a potential "best-in-disease therapy" for Chronic Myeloid Leukemia (CML), a market with established tyrosine kinase inhibitors (TKIs). The company's focus on an allosteric BCR-ABL inhibitor aims to differentiate it from current treatments, particularly in later lines of therapy and for patients with resistance mutations. The Fast Track designation from the FDA underscores the potential unmet medical need TERN-701 could address, indicating a significant opportunity within the oncology landscape.

Comparison to Industry Standards

• TERN-701's MMR achievement rate of 75% (18/24) by 24 weeks in evaluable patients at the recommended Phase 2 dose range (>320mg QD) is trending 2-3X higher than asciminib in Phase 1 and Phase 3 studies evaluating a 3L+ patient population.
• The CARDINAL trial enrolled a predominantly 3L+ patient population, with 38% of patients having received prior asciminib, of whom 75% discontinued due to lack of efficacy, highlighting TERN-701's potential in a difficult-to-treat patient segment.
• The preliminary study design for the pivotal trial anticipates evaluating TERN-701 against a control arm of investigator's choice 2nd generation TKIs (dasatinib, nilotinib, bosutinib), with major molecular response (MMR) at six months as the primary endpoint, setting a clear benchmark against current standard-of-care.

Stakeholder Impact

• Shareholders: Positive impact due to extended cash runway, strong clinical data for the lead asset, FDA Fast Track designation, and a clear development path, potentially increasing shareholder value.
• Patients (CML): Potential for a new, highly effective, and well-tolerated treatment option, especially for those who have failed previous therapies or have resistance mutations.
• Employees: Increased job security and potential for growth as the company advances its lead program towards pivotal trials and potential commercialization.
• Regulatory Authorities (FDA): Active engagement through End of Phase 2 interaction and Fast Track designation indicates collaboration and potential for expedited review.

Next Steps

• Management presentation at the 44th Annual J.P. Morgan Healthcare Conference on January 12, 2026.
• Selection of pivotal dose for TERN-701 in mid-2026.
• End of Phase 2 regulatory interaction with U.S. FDA for TERN-701 in mid-2026.
• Updated and expanded CARDINAL data by second half of 2026.
• Initiation of first pivotal trial (2L+ population) for TERN-701 in late 2026 / early 2027.
• Discovery efforts on undisclosed targets for oncology indications.
• Seeking a strategic partner to advance the TERN-501 and TERN-801 legacy metabolic programs.

Key Dates

Recommendation

The filing details highly positive clinical trial results for TERN-701, showing superior efficacy compared to existing treatments in a challenging patient population, coupled with an encouraging safety profile. The FDA Fast Track designation further de-risks the development pathway. Critically, the company has secured a substantial cash runway into 2031 through a recent capital raise, providing ample funding for TERN-701's pivotal trials and potential launch. This combination of strong clinical data, regulatory support, and robust financial health positions Terns Pharmaceuticals for significant future growth and makes it a compelling investment opportunity.

Keywords

Terns Pharmaceuticals, TERN-701, CML, Chronic Myeloid Leukemia, BCR-ABL inhibitor, oncology, clinical trial, CARDINAL, Fast Track designation, FDA, J.P. Morgan Healthcare Conference, cash runway, public offering, drug development, biotechnology