Merck has agreed to acquire Terns Pharmaceuticals for approximately $6.7 billion, a move aimed at accelerating its expansion in blood cancer treatments and reinforcing its long-term oncology strategy.
The deal centers on gaining access to Terns’ lead asset, TERN-701, an investigational oral therapy for chronic myeloid leukemia. This drug candidate is designed to address limitations in existing treatments, particularly for patients who have already undergone prior therapies but experienced resistance, intolerance, or suboptimal response. By acquiring Terns, Merck is positioning itself to bring a potentially best-in-class therapy into its portfolio at an earlier stage of development.
TERN-701 is currently in Phase 1/2 clinical trials and has demonstrated promising early results, including strong molecular response rates and a favorable safety profile. Importantly, the therapy has shown activity even in heavily pretreated patients, a group where treatment options remain limited. Merck sees this as an opportunity to fill a meaningful gap in the treatment landscape and differentiate itself in a competitive oncology market.
The acquisition also reflects Merck’s broader push to diversify beyond its existing oncology portfolio and build depth in hematologic cancers. While therapies for chronic myeloid leukemia have improved significantly over the past two decades, there remains a need for faster, deeper, and more durable responses with better tolerability. TERN-701’s mechanism as an allosteric BCR::ABL1 inhibitor offers a novel approach that could potentially improve outcomes compared to current standards of care.
Financially, Merck is paying $53.00 per share in cash, representing a notable premium to Terns’ recent stock price. The transaction is expected to close in the second quarter of 2026, subject to shareholder approval and regulatory clearances. The company expects to record a charge of approximately $5.8 billion related to the acquisition.
Overall, the deal underscores Merck’s strategy of acquiring innovative, mid-stage assets with strong early clinical data to strengthen its pipeline and sustain future growth in oncology, particularly in areas with unmet medical need.
KEY QUOTES:
“The acquisition of Terns builds on our growing presence in hematology with TERN-701, a potential best-in-class candidate for the treatment of certain patients with chronic myeloid leukemia. This transaction further diversifies and strengthens our position in oncology as we continue to look for opportunities to broaden our portfolio into other therapeutic areas.”
Robert M. Davis, Chairman And Chief Executive Officer, Merck
“This acquisition reflects our team’s deep commitment to innovation in oncology and developing high impact medicines. By working together, we will advance TERN-701, leveraging the deep expertise and significant resources at Merck, a global biopharmaceutical leader with a proven track record of delivering cancer breakthroughs for patients who need them most. I am immensely proud of the Terns team and our work towards making a difference for people living with CML. Finally, we extend our heartfelt thanks to the investigators, patients, and community advocates whose dedication and support make the development of TERN-701 possible.”
Amy Burroughs, Chief Executive Officer, Terns Pharmaceuticals
“The first approval of a BCR::ABL1 tyrosine kinase inhibitor 25 years ago transformed the prognosis for many patients with chronic myeloid leukemia. Despite new therapeutic options, there is significant need for innovative, well-tolerated therapies with faster time to onset of molecular response leading to deeper responses and better disease control. Based on early clinical evidence, TERN-701, a novel allosteric BCR::ABL1 inhibitor, may have the potential to provide a meaningfully differentiated option for certain patients living with CML.”
Dean Y. Li, President, Merck Research Laboratories
