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Terns (Nasdaq: TERN) priced an upsized underwritten public offering of 16,250,000 common shares at $40.00 per share, for gross proceeds of approximately $650 million, before underwriting discounts, commissions and expenses.
The company granted underwriters a 30‑day option to purchase up to an additional 2,437,500 shares at the public offering price. The offering is expected to close on December 11, 2025, subject to customary conditions. Net proceeds are intended to fund research, clinical trials, development and manufacturing of product candidates including TERN‑701, initial commercial launch preparations for TERN‑701, and general corporate purposes.
Positive
- $650M gross proceeds from the offering
- Issuance of 16,250,000 shares priced at $40.00 per share
- Proceeds earmarked to fund TERN‑701 development and launch activities
- Underwriters granted a 30‑day option for an additional 2,437,500 shares (15%)
Negative
- Issuance of 16,250,000 shares will cause shareholder dilution
- Underwriting discounts and offering expenses will reduce net proceeds
- Market overhang risk until expected close on December 11, 2025
Key Figures
Shares offered 16,250,000 shares Common stock in upsized underwritten public offering
Offering price $40.00 per share Public offering price before underwriting discounts
Gross proceeds $650 million Expected before underwriting discounts and expenses
Underwriters’ option 2,437,500 shares 30‑day option to purchase additional common shares
Expected close date December 11, 2025 Expected closing of the offering, subject to conditions
Cash & securities $295.6M Cash, cash equivalents and marketable securities at Sept 30, 2025
Q3 2025 net loss $24.6M Quarter ended September 30, 2025
TERN‑701 MMR rate 64% by 24 weeks Phase 1 CARDINAL efficacy‑evaluable patients as of Sept 13, 2025
Market Reality Check
$42.57 Last Close
Volume Volume 7,970,843 is about 80% above the 20‑day average of 4,421,423, showing elevated trading ahead of the offering. high
Technical Shares at $42.57 are trading well above the 200‑day MA of $7.66, near the 52‑week high of $45.18.
Peers on Argus
TERN rose 5.82% while key biotech peers showed declines, indicating a company‑specific move rather than a sector‑wide trend.
Historical Context
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Dec 08 | Clinical data update | Positive | +37.0% | Additional positive Phase 1 CARDINAL data for TERN‑701 in R/R CML. |
| Nov 14 | Conference participation | Neutral | +13.3% | Announcement of presentation at Jefferies Global Healthcare Conference. |
| Nov 10 | Earnings and pipeline | Positive | +3.5% | Q3 2025 results and positive TERN‑701 update with solid cash runway. |
| Nov 04 | Equity compensation | Neutral | +4.4% | Inducement stock option grants to new employees under Nasdaq rules. |
| Nov 03 | Clinical data update | Positive | +69.8% | Positive Phase 1 CARDINAL data for TERN‑701 selected for ASH oral talk. |
Recent TERN news, especially around TERN‑701, has often coincided with strong positive price reactions, suggesting high sensitivity to clinical and corporate catalysts.
Over the last few months, Terns has reported multiple positive updates on TERN‑701, including strong Phase 1 CARDINAL response rates and an oral presentation at ASH 2025, which were followed by large gains of 37.02% and 69.85%. Corporate events such as conference participation, Q3 results with $295.6M in cash and securities, and inducement grants also saw positive reactions. The public offering follows a period of strong data‑driven appreciation, adding a capital‑raising step to the recent clinical and corporate momentum.
Market Pulse Summary
Terns announced a sizable equity financing, pricing 16,250,000 shares at $40.00 for expected gross proceeds of $650 million. The proceeds are earmarked for research, clinical trials, and potential launch preparations for TERN‑701, building on earlier positive Phase 1 data. Investors will watch the December 11, 2025 closing, subsequent capital deployment, and how the additional share option may affect dilution and short‑term volatility.
Analyst Commentary
From a capital‑structure perspective, the $650 million raise adds a substantial cash buffer that extends Terns’ runway well beyond the anticipated Phase 2 initiation for TERN‑701. The pricing at $40 per share represents a roughly 30 % premium to the pre‑announcement share price, indicating solid investor appetite for a biotech that is de‑risking its lead asset through positive Phase 1 read‑outs. However, the 15 % over‑allotment option injects a measurable dilution risk, which could modestly pressure per‑share earnings guidance once the additional shares are exercised. Technologically, TERN‑701’s allosteric inhibition of BCR‑ABL offers a differentiated mechanism that may overcome resistance mutations driving next‑generation CML failures, positioning the candidate favorably against competitors such as asciminib and newer TKIs in the pipeline. If TERN‑701 proceeds to Phase 2 with comparable efficacy, the company could attract partnership interest that further leverages the cash infusion, potentially lowering the net cost of commercial launch. Market participants should monitor the upcoming regulatory filing timeline, the company’s ability to scale manufacturing, and macro‑level biotech financing trends, which have shown heightened volatility in the current interest‑rate environment.
Key Terms
underwritten public offering financial
An underwritten public offering is when a company sells new shares of its stock to the public with the assistance of underwriters who purchase the entire issue and resell it to investors, thereby reducing the issuer’s risk and providing rapid capital.
prospectus supplement regulatory
A prospectus supplement provides updated information about a securities offering, ensuring investors receive the latest terms, risks, and material facts before committing capital.
Rule 10b5-1 regulatory
Rule 10b5‑1 permits insiders to establish pre‑arranged trading plans, allowing them to buy or sell shares without violating insider‑trading prohibitions, thereby offering transparency to the market.
Schedule 13G regulatory
Schedule 13G is filed when an investor acquires a significant stake for passive investment purposes, enhancing disclosure of ownership structures in public companies.
Orphan Drug Designation regulatory
Orphan Drug Designation provides incentives such as market exclusivity and tax credits for drugs targeting rare diseases, improving the commercial outlook for eligible therapies.
AI-generated analysis. Not financial advice.
FOSTER CITY, Calif., Dec. 09, 2025 (GLOBE NEWSWIRE) – Terns Pharmaceuticals, Inc. (“Terns” or the “Company”) (Nasdaq: TERN), a clinical‑stage oncology company, announced the pricing of its upsized underwritten public offering of 16,250,000 shares of common stock at $40.00 per share, before underwriting discounts and commissions. The gross proceeds are expected to be $650 million, excluding any exercise of the underwriters’ option to purchase additional shares. The company granted the underwriters a 30‑day option to purchase up to an additional 2,437,500 shares at the public offering price, less underwriting discounts and commissions. The offering is expected to close on December 11, 2025, subject to customary closing conditions.
Jefferies, TD Cowen and Leerink Partners are acting as lead book‑running managers for the proposed offering. Mizuho, Citizens Capital Markets and Oppenheimer & Co. are also acting as co‑managers.
Terns intends to use the net proceeds to fund research, clinical trials, development and manufacturing of key product candidates, including TERN‑701, as well as initial activities in preparation for a potential commercial launch of TERN‑701 and for working capital and general corporate purposes.
A shelf registration statement on Form S‑3 (File No. 333‑292016) relating to the securities offered in the public offering was filed with the SEC on December 9, 2025 and became effective on that date. The offering will be made only by means of a prospectus supplement and accompanying prospectus that form part of the registration statement. Preliminary and final prospectus supplements are available on the SEC’s website.
This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities, nor will there be any sale of these securities in any jurisdiction where such offer, solicitation or sale would be unlawful.
About Terns Pharmaceuticals
Terns Pharmaceuticals is a clinical‑stage oncology company reimagining known biology to deliver high‑impact medicines. Its lead program, TERN‑701, is a highly selective, allosteric BCR‑ABL inhibitor that could improve efficacy, safety and convenience over existing chronic myeloid leukemia (CML) therapies.
Cautionary Note Regarding Forward‑Looking Statements
This release contains forward‑looking statements regarding Terns, including the anticipated closing date of the offering, the intended use of proceeds and the potential clinical profile of TERN‑701. Such statements involve risks and uncertainties, including those related to the timing and outcomes of clinical development, regulatory approvals and market acceptance. Actual results may differ materially. Readers are encouraged to review the risk factors disclosed in the company’s SEC filings, including its Form 10‑K, Form 10‑Q and the prospectus supplement.
FAQ
How many shares did Terns (TERN) price in the upsized offering on December 10, 2025?
Terns priced 16,250,000 common shares at $40.00 per share.
What are the expected gross proceeds from Terns’ December 2025 offering (TERN)?
The offering is expected to generate approximately $650 million in gross proceeds before fees and expenses.
Will Terns (TERN) allow the underwriters to buy more shares in the offering?
Yes. Underwriters have a 30‑day option to purchase up to 2,437,500 additional shares at the offering price.
When is the Terns (TERN) offering expected to close?
The offering is expected to close on December 11, 2025, subject to customary closing conditions.
How does Terns (TERN) intend to use the net proceeds from the offering?
Proceeds will fund research, clinical trials, development and manufacturing of candidates including TERN‑701, initial launch activities for TERN‑701, and general corporate purposes.
Who are the lead managers for Terns’ (TERN) public offering?
Jefferies, TD Cowen and Leerink Partners are acting as lead book‑running managers; Mizuho, Citizens Capital Markets and Oppenheimer & Co. are co‑managers.
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