Terns Pharmaceuticals Reports $96.2 Million Net Loss for 2025, Merger with Merck Announced

Terns Pharmaceuticals, Inc., a clinical-stage oncology company, reported a net loss of $96.2 million for the year ended December 31, 2025, compared to a net loss of $88.9 million for the previous year. The company, which has no products approved for commercial sale, attributed these losses primarily to research and development expenses, which totaled $77.9 million in 2025, up from $70.1 million in 2024. General and administrative expenses also contributed to the losses, amounting to $32.2 million in 2025, a slight increase from $31.8 million in 2024. These expenses reflect the company's ongoing efforts to advance its pipeline of drug candidates.

The increased research and development spending was largely driven by the company's lead oncology asset, TERN-701, which is currently in Phase 1/2 development for chronic myeloid leukemia (CML). TERN-701 expenses increased by $9.6 million, while TERN-601 expenses increased by $4.9 million. These increases were partially offset by a $4.7 million decrease in other programs. The company is seeking strategic partners to advance its legacy metabolic programs, TERN-501 and TERN-801. As of December 31, 2025, Terns Pharmaceuticals had capital resources of $1.02 billion, which the company believes will be sufficient to fund operations into 2031.

A significant development for Terns Pharmaceuticals is the pending acquisition by Merck Sharp & Dohme LLC, announced on March 24, 2026. Under the terms of the merger agreement, Merck will acquire all outstanding shares of Terns at a price of $53.00 per share, subject to customary closing conditions, including regulatory approvals. The transaction is expected to close in the second quarter of 2026, after which Terns will become a subsidiary of Merck & Co., Inc., and its common stock will be delisted from the Nasdaq Global Select Market. The merger agreement includes a termination fee of $235 million payable by Terns to Merck under certain circumstances.

Operationally, Terns Pharmaceuticals is focused on advancing TERN-701 through clinical development, with plans to initiate a Phase 3 clinical trial in late 2026 or early 2027. The company is also conducting ongoing discovery efforts for small-molecule oncology candidates. As of December 31, 2025, Terns had 59 full-time employees, primarily engaged in research and development activities. The company relies on third-party contract manufacturers for the production of its clinical drug supplies and intends to continue this arrangement for commercial production, pending regulatory approval of its product candidates.