Subsequent Events	12 Months Ended
Dec. 31, 2025
Subsequent Events [Abstract]
Subsequent Events	9. Subsequent Events The Company evaluated subsequent events occurring after December 31, 2025 through the date the consolidated financial statements were issued. Pending Acquisition by Merck Sharp & Dohme LLC On March 24, 2026, the Company entered into an Agreement and Plan of Merger (the Merger Agreement) by and among the Company, Merck Sharp & Dohme LLC, a New Jersey limited liability company (Parent), and Thailand Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (Purchaser). Pursuant to the Merger Agreement, upon the terms and subject to the conditions thereof, Parent will cause Purchaser to commence a tender offer (the Offer) to purchase all of the outstanding shares of the Company’s common stock, par value $0.0001 per share (the Shares), at a price of $53.00 per Share (the Offer Price), without any interest thereon and subject to any withholding of taxes. The obligation of Purchaser to accept for payment, and pay for, any Shares validly tendered (and not validly withdrawn) pursuant to the Offer is subject to satisfaction or waiver of certain conditions set forth in the Merger Agreement, including, among other things, (a) there being validly tendered and not validly withdrawn Shares that represent one more Share than 50% of the total number of Shares then issued and outstanding, as calculated in accordance with the terms of the Merger Agreement, (b) any waiting period (or any extension thereof) applicable to the Offer under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act), having expired or been terminated and (c) there not having been issued and remaining in effect any governmental order or law prohibiting or making illegal the Transactions (as defined below). As soon as practicable following consummation of the Offer, subject to the terms and conditions of the Merger Agreement and in accordance with Section 251(h) of the General Corporation Law of the State of Delaware, Purchaser will merge with and into the Company (the Merger, which, together with the Offer and the other transactions contemplated by the Merger Agreement, are referred to as the Transactions), with the Company surviving the Merger as a wholly owned subsidiary of Parent. At the effective time of the Merger (the Effective Time), each Share then issued and outstanding (other than Shares (a) held at the commencement of the Offer and immediately prior to the Effective Time by the Company (or held in the Company’s treasury), Parent, Purchaser or any other direct or indirect wholly owned subsidiary of the Company, Parent or Purchaser or (b) irrevocably accepted for purchase pursuant to the Offer) will be converted into the right to receive the Offer Price (the Merger Consideration), without any interest thereon and subject to any withholding of taxes. In addition, at the Effective Time, (a) each option to purchase Shares that is outstanding and unexercised immediately prior to the Effective Time, whether or not vested and which has a per share exercise price that is less than the Merger Consideration (each, an In the Money Option), will be cancelled and converted into the right to receive (without interest) a cash payment equal to (i) the excess of (A) the Merger Consideration over (B) the exercise price payable per Share of such In the Money Option, multiplied by (ii) the total number of Shares subject to such In the Money Option, (b) each option to purchase Shares other than an In the Money Option that is outstanding and unexercised as of immediately prior to the Effective Time, whether or not vested, will be cancelled with no consideration payable in respect thereof and (c) each restricted stock unit award covering Shares (each, a Company RSU) that is outstanding as of immediately prior to the Effective Time, whether or not vested, will be cancelled and the holder thereof will be entitled to receive (without interest) a cash payment equal to the product of (i) the Merger Consideration and (ii) the number of Shares subject to such Company RSU. As of the time at which all Shares tendered (and not validly withdrawn) pursuant to the Offer are accepted by Purchaser for payment (the Offer Acceptance Time), each pre-funded warrant to purchase Shares issued on September 10, 2024 (each, a Company Warrant) that is issued and outstanding as of immediately prior to the Offer Acceptance Time will be automatically deemed to be exercised in full in a “cashless exercise” (as defined in, and pursuant to the terms of, such Company Warrant) and will be converted into the right to receive cash in an amount equal to the product of (a) the total number of Shares issuable upon such cashless exercise of such Company Warrant as of immediately prior to the Offer Acceptance Time pursuant to the terms thereof and (b) the Offer Price, subject to any withholding of taxes. Effective as of the Effective Time, the Company will terminate its 2017 Equity Incentive Plan, 2021 Incentive Award Plan and 2022 Employment Inducement Award Plan, each as amended and restated from time to time, and all outstanding grants of equity and equity-based awards. The Merger Agreement includes representations, warranties and covenants of the parties customary for a transaction of this nature. From the date of the Merger Agreement until the earlier of the effective time of the Merger and the valid termination of the Merger Agreement, the Company has agreed, subject to certain exceptions, to use commercially reasonable efforts to operate the Company’s and the Company’s subsidiaries’ business and operations in the ordinary course in all material respects and have agreed to certain other operating covenants, as set forth more fully in the Merger Agreement. The Merger Agreement provides the Parent and the Company with certain termination rights and, under certain circumstances, may require the Company to pay the Parent a termination fee of $235 million. For additional information related to the Merger Agreement, refer to our Current Report on Form 8-K, which was filed with the SEC on March 25, 2026, including Exhibit 2.1 thereto. Please also see Part I, Item 1, “Business” and Part I, Item 1A, “Risk Factors—Risks Relating to Pending Transaction with Merck Sharp & Dohme LLC” of this Annual Report on Form 10-K.

Subsequent Events

12 Months Ended

Dec. 31, 2025

9. Subsequent Events

The Company evaluated subsequent events occurring after December 31, 2025 through the date the consolidated financial statements were issued.

Pending Acquisition by Merck Sharp & Dohme LLC

On March 24, 2026, the Company entered into an Agreement and Plan of Merger (the Merger Agreement) by and among the Company, Merck Sharp & Dohme LLC, a New Jersey limited liability company (Parent), and Thailand Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (Purchaser).

Pursuant to the Merger Agreement, upon the terms and subject to the conditions thereof, Parent will cause Purchaser to commence a tender offer (the Offer) to purchase all of the outstanding shares of the Company’s common stock, par value $0.0001 per share (the Shares), at a price of $53.00 per Share (the Offer Price), without any interest thereon and subject to any withholding of taxes.

The obligation of Purchaser to accept for payment, and pay for, any Shares validly tendered (and not validly withdrawn) pursuant to the Offer is subject to satisfaction or waiver of certain conditions set forth in the Merger Agreement, including, among other things, (a) there being validly tendered and not validly withdrawn Shares that represent one more Share than 50% of the total number of Shares then issued and outstanding, as calculated in accordance with the terms of the Merger Agreement, (b) any waiting period (or any extension thereof) applicable to the Offer under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act), having expired or been terminated and (c) there not having been issued and remaining in effect any governmental order or law prohibiting or making illegal the Transactions (as defined below).

As soon as practicable following consummation of the Offer, subject to the terms and conditions of the Merger Agreement and in accordance with Section 251(h) of the General Corporation Law of the State of Delaware, Purchaser will merge with and into the Company (the Merger, which, together with the Offer and the other transactions contemplated by the Merger Agreement, are referred to as the Transactions), with the Company surviving the Merger as a wholly owned subsidiary of Parent.

At the effective time of the Merger (the Effective Time), each Share then issued and outstanding (other than Shares (a) held at the commencement of the Offer and immediately prior to the Effective Time by the Company (or held in the Company’s treasury), Parent, Purchaser or any other direct or indirect wholly owned subsidiary of the Company, Parent or Purchaser or (b) irrevocably accepted for purchase pursuant to the Offer) will be converted into the right to receive the Offer Price (the Merger Consideration), without any interest thereon and subject to any withholding of taxes.

In addition, at the Effective Time, (a) each option to purchase Shares that is outstanding and unexercised immediately prior to the Effective Time, whether or not vested and which has a per share exercise price that is less than the Merger Consideration (each, an In the Money Option), will be cancelled and converted into the right to receive (without interest) a cash payment equal to (i) the excess of (A) the Merger Consideration over (B) the exercise price payable per Share of such In the Money Option, multiplied by (ii) the total number of Shares subject to such In the Money Option, (b) each option to purchase Shares other than an In the Money Option that is outstanding and unexercised as of immediately prior to the Effective Time, whether or not vested, will be cancelled with no consideration payable in respect thereof and (c) each restricted stock unit award covering Shares (each, a Company RSU) that is outstanding as of immediately prior to the Effective Time, whether or not vested, will be cancelled and the holder thereof will be entitled to receive (without interest) a cash payment equal to the product of (i) the Merger Consideration and (ii) the number of Shares subject to such Company RSU.

As of the time at which all Shares tendered (and not validly withdrawn) pursuant to the Offer are accepted by Purchaser for payment (the Offer Acceptance Time), each pre-funded warrant to purchase Shares issued on September 10, 2024 (each, a Company Warrant) that is issued and outstanding as of immediately prior to the Offer Acceptance

Time will be automatically deemed to be exercised in full in a “cashless exercise” (as defined in, and pursuant to the terms of, such Company Warrant) and will be converted into the right to receive cash in an amount equal to the product of (a) the total number of Shares issuable upon such cashless exercise of such Company Warrant as of immediately prior to the Offer Acceptance Time pursuant to the terms thereof and (b) the Offer Price, subject to any withholding of taxes.

Effective as of the Effective Time, the Company will terminate its 2017 Equity Incentive Plan, 2021 Incentive Award Plan and 2022 Employment Inducement Award Plan, each as amended and restated from time to time, and all outstanding grants of equity and equity-based awards.

The Merger Agreement includes representations, warranties and covenants of the parties customary for a transaction of this nature. From the date of the Merger Agreement until the earlier of the effective time of the Merger and the valid termination of the Merger Agreement, the Company has agreed, subject to certain exceptions, to use commercially reasonable efforts to operate the Company’s and the Company’s subsidiaries’ business and operations in the ordinary course in all material respects and have agreed to certain other operating covenants, as set forth more fully in the Merger Agreement. The Merger Agreement provides the Parent and the Company with certain termination rights and, under certain circumstances, may require the Company to pay the Parent a termination fee of $235 million.

For additional information related to the Merger Agreement, refer to our Current Report on Form 8-K, which was filed with the SEC on March 25, 2026, including Exhibit 2.1 thereto. Please also see Part I, Item 1, “Business” and Part I, Item 1A, “Risk Factors—Risks Relating to Pending Transaction with Merck Sharp & Dohme LLC” of this Annual Report on Form 10-K.

Terns Pharmaceuticals, Inc. 10-K