Terns Pharmaceuticals experienced a significant rise in its share price after reporting positive results from an early-stage trial of its chronic myeloid leukemia (CML) therapy, TERN-701. The company’s shares increased by 10% to $44.45 at the opening of the market on Tuesday, following a pre-market surge that reached as high as 55% over the weekend ahead of the data release.
The results were presented at the American Society of Hematology (ASH) annual meeting. In the Phase I CARDINAL trial, which included 38 patients with previously treated CML, TERN-701 achieved a major molecular response (MMR) rate of 75% at week 24. Additionally, 64% of participants reached MMR during the study period. The drug is an allosteric BCR/ABL1 inhibitor and showed no food effect, supporting daily dosing.
“Unprecedented remains the only suitable adjective to describe the compound’s clinical profile,” William Blair analysts stated Tuesday morning.
For comparison, Novartis’ approved STAMP inhibitor Scemblix and another investigational CML treatment, Enliven’s ELVN-001, have shown response rates between 24% and 32% in their respective trials.
“It is rare for an investigational agent to demonstrate unequivocal improvement in both clinical efficacy and safety and concurrently provide patients with better convenience of daily dosing with no food effect,” William Blair analysts wrote in a note Tuesday. “We believe TERN-701 is on track to challenge Scemblix’s dominance and disrupt the treatment paradigm of CML.”
William Blair also noted that TERN-701 was able to help patients who had relapsed after treatment with Scemblix. In a subgroup analysis involving ten such patients, TERN-701 led to a 43% MMR rate.
BMO Capital Markets analysts described the 75% MMR rate as impressive but emphasized that sustained response will be crucial for commercial success. According to BMO’s projections, TERN-701 could generate peak sales of $3.4 billion if these results are maintained over time.
The positive trial outcome marks a strategic shift for Terns Pharmaceuticals, which had previously focused on metabolic diseases like obesity and metabolic dysfunction-associated steatohepatitis (MASH). Earlier this year, citing saturation in those markets, Terns redirected its focus toward oncology and is seeking partners for its remaining metabolic assets.
Looking ahead, Terns plans to release additional data from the CARDINAL trial next year and meet with regulatory authorities regarding future studies for front-line and second-line CML indications. Company executives reported improved patient enrollment since releasing preliminary ASH data.
“With enrollment timelines likely becoming more impactful in 2026, we see this expedited timeline as a meaningful positive that could benefit development timelines in the coming year,” BMO analysts said.
William Blair analysts remain optimistic about future prospects: “We are optimistic that the best-in-disease results will likely be replicated in the pivotal setting,” they wrote regarding upcoming clinical programs for TERN-701.
Following these developments, Terns announced a public offering valued at $400 million to support further development of TERN-701 and prepare for potential commercialization.
