By Bill Alpert
The effectiveness of a leukemia drug from Terns Pharmaceuticals exceeded the hopes of many doctors and investors when the biotech firm reported early phase trial results this week.
Terns shares jumped as much as 50% on the news that cancer cell counts fell over 99% in nearly three-fourths of the 38 leukemia patients treated for six months with the firm's once-daily pill. That's nearly twice the effectiveness of Scemblix, a similar drug from Novartis that has reached annual sales of a billion dollars.
Arcellx was another stock lifted by study results reported at the American Society of Hematology meeting in Orlando, Fla. The shares popped 13% as a pivotal trial of its multiple-myeloma cell therapy showed fewer side effects with comparable efficacy to an established therapy from Legend Biotech. Shares of Legend slipped more than 10%.
In the Terns Phase 1 study, all the patients had chronic myeloid leukemia that had resisted at least three prior treatments, including with Novartis's Scemblix. Both the Terns pill, code-named TERN-701, and Scemblix are second-generation versions of drugs that inhibit a growth promoter of cancer cells, called tyrosine kinase. In the early phase study, the Tern drug does it better, with fewer side effects and no need to avoid certain foods.
"Unprecedented," was how William Blair analyst Andy Hsieh described the Terns drug's performance. "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."
Terns stock shot from $5 to a recent $42.70 this year. That has won it fans among analysts searching for the next biotech acquisition by Big Pharma. The Terns drug is early in its clinical trials, so its performance when used earlier in a patient's illness remains unknown -- along with the durability of its cancer suppression.
Still, Terns bulls are projecting a large market.
Oppenheimer's Jay Olson calls TERNS-701 "a Me-Much-Better Scemblix," while noting that Novartis now expects Scemblix peak sales to reach $4 billion a year. He thinks Terns stock is worth $58.
Another highlight of the hematology meeting was Saturday's report of the pivotal Phase 3 trial of anito-cel, the Arcellx treatment for multiple-myeloma. Developed in partnership with Gilead Sciences, the treatment is a so-called CAR-T therapy that extracts a patient's T-cells and modifies them to target cancer cells. CAR-T treatments have been a cancer breakthrough, and are beginning to make a dent in aut0-immune disorders like lupus and multiple sclerosis.
In about a hundred patients whose cancers advanced despite three or more other treatments, the Arcellx CAR-T eliminated measurable cancers in about three-quarters of patients and kept it at bay in most of them for up to two years. That's roughly comparable to the similar CAR-T treatment Carvykti that's marketed since 2022 by Legend and its partner Johnson & Johnson. Carvykti sales should exceed $1 billion this year.
Arecellx researchers noted that side effect damage to nerves and blood cells was milder with their treatment than what has been seen with Legend's Carvykti. They plan to file for marketing approval next year. William Blair analyst Sami Corwin believes the Arcellx treatment will prove the best-in-class, and rates the stock a Buy.
Legend still has fans.
"The fight is on," wrote Sean McCutcheon of Raymond James, as he noted that Carvykti's longer time in use against multiple myeloma gives doctors more evidence on the treatment's durability. After five years, cancer has remained in check for about a third of Carvykti patients. Studies presented at ASH showed that starting the CAR-T treatment earlier in a patient's disease led to even better outcomes.
Legend shares were knocked from $28 to $24 this week by the impending challenge of the Arcellx/Gilead CAR-T. But McCutcheon is keeping his Buy rating and believes Legend can rise to $86.
Write to Bill Alpert at william.alpert@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
December 09, 2025 15:31 ET (20:31 GMT)
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