08:05 AM EDT, 10/22/2025 (MT Newswires) -- Terns Pharmaceuticals ( TERN ) said Wednesday it will not advance its investigational obesity drug TERN-601 or invest in other metabolic assets after a phase 2 trial failed to meet thresholds for safety, tolerability, and efficacy.

The oral GLP-1 receptor agonist showed a placebo-adjusted weight loss of 4.6% after 12 weeks, with around 12% of patients discontinuing treatment after adverse events, the company said.

The company said it will now focus on its potential chronic myeloid leukemia treatment TERN-701 and will release results from a phase 1 trial of the drug this quarter.

Mizuho Securities lowered its price target on the stock to $9 per share from $14, but kept its outperform rating.

"While we expect the stock to fall on the news, we see a silver lining; in viewing the negative '601 read-out to be a clearing event, we find the remaining oncology-focused TERN story simpler, straightforward and ultimately, more attractive," the note said.

Shares of the company were down more than 10% in recent premarket activity Wednesday.