U.S.-based Merck & Co. has agreed to acquire Terns Pharmaceuticals in a $6.7 billion deal, as it looks to strengthen its cancer pipeline and reduce reliance on its blockbuster drug Keytruda.
Under the agreement, Merck will pay $53 per share for Terns, offering a premium over its recent market price. The acquisition has been approved by both companies’ boards and is expected to close in the second quarter of 2026, subject to regulatory approvals and shareholder consent.
The deal is centered on Terns’ lead drug candidate, TERN-701, an experimental oral therapy for chronic myeloid leukemia (CML), a form of blood cancer. The drug is currently in early to mid-stage clinical trials and has shown promising results, positioning it as a potential next-generation treatment option.
Merck’s move comes as it prepares for the future loss of exclusivity of Keytruda, its blockbuster drug that generates significant revenue. To offset this, the company is actively investing in oncology drugs and expanding its drug pipeline to ensure long-term growth.
Beyond cancer, Terns is also developing treatments for obesity treatment and liver diseases, adding strategic value to the acquisition. This diversified pipeline gives Merck opportunities to expand beyond oncology in the coming years.
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The deal is expected to result in a one-time charge of around $5.8 billion for Merck. Despite this, the company views the acquisition as a long-term investment aimed at boosting pharmaceutical growth and innovation.
Industry experts note that this move reflects a broader trend where major drugmakers are pursuing biotech acquisition strategies to stay competitive and address upcoming patent expirations. While the offer includes a reasonable premium, some analysts believe it could still attract rival bids, although none have emerged so far.
Overall, the acquisition highlights Merck’s continued push into the rapidly growing oncology market, reinforcing its position in global healthcare and strengthening its future portfolio.
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