Hello, everyone. I'm Jay Olson, one of the biotech analysts at Oppenheimer, and it's a pleasure to welcome you to Oppenheimer's 35th Annual Healthcare Conference and our discussion with Terns Pharmaceuticals. It's a pleasure to introduce Amy Burroughs, CEO, and Emil Kuriakose, CMO. Thank you very much for joining us, Amy and Emil. Thank you so much, Jay and the team at Oppenheimer for welcoming us to today's conference. I would love to go through sort of an overview and take questions at the end. So before we begin, I'd like to remind you that we will be making forward-looking statements, and refer you to our website for additional information. So we are passionate at Terns about developing medicines that make a difference in people's lives. We had a transformational year in 2024, and we're going to continue that momentum in 2025 as we focus on what we call two by two by two, which is two potentially best-in-class molecules in two blockbuster indications and two significant clinical readouts in 2025 that I'm going to tell you about today. So just an overview here. For TERN-701, our allosteric BCR-ABL inhibitor for chronic myeloid leukemia, or CML, we have a potential best-in-class treatment in a $5 billion market. We showed you in December early clinical data that supports our differentiated profile and a high probability of clinical and regulatory success and a clear path to the frontline market. We have upcoming data in the fourth quarter of this year that we'll read through to the registrational endpoint. On TERN-601, our oral small molecule GLP-1 receptor agonist, we shared a differentiated phase I obesity 28-day data set in September. It's an oral small molecule that is easy to manufacture and scale, and we've also outlined distinct drug properties that may enable competitive weight loss and superior tolerability in longer-term studies, and our upcoming phase II is designed to support this differentiation thesis, and we'll read out in the second half of this year. All of this is really supported by a strong balance sheet, which takes us into 2028 and through multiple catalysts. Our focus today will be TERN-701 and TERN-601 with these data catalysts coming up, but our efforts are broader. All of our medicines are internally discovered. We have two additional obesity assets, which are intended to be used in combination with a GLP-1 receptor agonist to enhance weight loss and metabolic benefits. That's a GIPR discovery program and a THR-β agonist. We won't cover those in detail today, really just due to time constraints. Let me dive into CML and this exciting opportunity that we see with TERN-701. CML is important to me. I lost a close family member to this disease before it was transformed by BCR-ABL inhibitors into a chronic lifelong condition for most patients. This happened in 2001, and over the next decade, we had additional active site tyrosine kinase inhibitors, or TKIs, that improved on efficacy but had a worse safety and tolerability profile than the first-generation imatinib. They're called active site inhibitors because they bind to the ATP- binding site on the BCR-ABL fusion protein. Due to the limitations of these active site inhibitors, almost half of CML patients on these therapies switch due to treatment failure, tolerability, or safety. Allosteric inhibitors such as TERN-701 are more selective than active sites and bind to a different pocket on the BCR-ABL protein. The first approved allosteric, asciminib, has shown that this novel mechanism translates into superior efficacy and safety over active site inhibitors. However, asciminib leaves meaningful room for improvement that we will discuss. As a better allosteric inhibitor, TERN-701 has an opportunity to continue to raise the bar and deliver improved outcomes for these patients who want and deserve more. Let me tell you more specifics. So at a high level, our goal is to be the best allosteric TKI with clinically meaningful improvements over asciminib in three key areas. The first is greater efficacy through optimized dosing and better target coverage. The second is improved tolerability and safety. And last, and very important for patients with a chronic disease, is improved convenience. It will be easier to administer with once-daily dosing without regard to food for all patients. So let's get into some of the data that supports this target product profile as the best option for treating CML. So these are our three pillars of differentiation. Our emerging data to support better efficacy is threefold. First, in preclinical assays, potency greater than asciminib. Second, improved target coverage through improved PK and dose optimization. And finally, early clinical data that we'll go through in a minute showing responses in asciminib failures. On safety, we've begun to differentiate versus asciminib with the early data from our phase I clinical study with no DLTs, no dose reductions, and no AE-related discontinuations, which is truly remarkable. Lastly, we have shown how 701 can provide improved convenience and make it more likely that a patient can stay on their drug in a compliant way for life. Unlike asciminib, we will have once-daily dosing for all patients and have shown that dosing with food does not have an impact on target coverage. asciminib has a three-hour fasting requirement and must be dosed twice per day for some patients. Together, these pillars represent a compelling opportunity to surpass asciminib as the best allosteric in CML, and we are already building significant clinical data to support our differentiation. At our next data readout in the fourth quarter of this year, you will have the first look at six-month major molecular response rates, also called MMR rates, which is important as MMR is the registrational endpoint and takes a bit of time to emerge. So with that, let's jump into our CARDINAL trial design, our phase I trial for which we shared exciting data in early December. It's a standard dose escalation dose expansion setup. Two notable things that I'll point out are that regulators allowed second-line patients in this phase I dose escalation for the first time in CML based on the body of data for TERN-701. We also allowed participants who have been treated with asciminib. As noted previously, we did not have any DLTs in dose escalation, and we have completed dose escalation, which enrolled rapidly. This safety data allows us to talk to regulators about exploring the higher end of the dose range as we move to expansion in the first half of this year. Stay tuned for more details on the doses selected as we begin dose expansion. So as of the data cutoff in October of 2024, our analysis included 15 patients. As one would expect in a phase I trial, patients were heavily pretreated with a high baseline disease burden and a median of four prior treatments. Of the six patients who had seen asciminib, we saw both suboptimal efficacy and intolerance as reasons for discontinuation. Despite the heavily pretreated nature of these patients, we saw highly encouraging signs of efficacy and safety. Let's move to the data. Here's a swimmer plot of the 15 patients with details about their baseline characteristics listed on the left. As we will discuss next, we observed meaningful activity after a relatively short median treatment duration of three months. Remember that I told you that it takes time for molecular response to emerge in this disease. 14 of these 15 patients remain on treatment. The top light blue lanes show the seven patients on our lowest dose of 160 mg. Mid is 320 mg, and the bottom lanes in dark blue are 400 mg doses. To be efficacy evaluable, patients must have had at least two on-treatment assessments performed centrally, which is generally done on a monthly basis. The 12 patients at the lower two dose levels were all efficacy evaluable. All 15 patients here are safety evaluable. Let's get into a bit more detail about these signs of efficacy. So this is a standard table for a CML trial, but it's a bit complex. Let me take a moment to explain it. BCR-ABL transcript levels are a measure of disease burden in CML and are grouped into categories. Responses are evaluated by categorical shifts. In this table, patients with the highest disease burden at baseline are in the column on the right as their baseline transcript levels are 10% or more. Post-treatment levels are listed from lowest to highest by row, and those at MR3 or better are in major molecular response or MMR. This table shows the baseline and post-treatment categories for the 10 patients with at least three months of treatment or an MMR at baseline who do not have a difficult-to-treat mutation called T315I. Patients in the blue boxes maintain their transcript category over the course of treatment. In the green shaded area, we have two patients with higher disease burden at baseline who achieved categorical molecular improvements. Over such a short period of time and with such a heavily pretreated population, we are pleased to see half of patients maintaining or moving to a major molecular response. I would also note that no patients had shifts into a worse response category versus baseline, as represented by the red area on the table. Overall, we are highly encouraged to see a cumulative MMR rate of 50%, a promising foundation on which to build 701's efficacy differentiation. So the next slide shows changes in transcript levels for patients with transcripts at baseline above 1% or those with a higher disease burden. As shown in the plot, seven of eight patients showed decreases, and seeing these kinds of broad decreases in transcripts is a good early indicator of a drug's activity. There was one discontinuation due to a loss of response in a difficult-to-treat sixth-line patient. I'll highlight that most of these patients had a higher leukemic burden with baseline transcripts above 10% and several above 50%. This makes these decreases in transcripts even more clinically meaningful at this early time point. So let's go to two patient case studies. This is a 35-year-old patient with an eight-year history of CML and six years of treatment on dasatinib before losing their response. Following treatment with ponatinib and asciminib for one year each, the patient was switched to 701 not only due to a suboptimal plateauing of response, but also due to intolerance with elevated LFTs and lipid abnormalities while on asciminib. After five cycles on TERN-701, this patient achieved MR2 and a steeper response without the tolerability issues seen with asciminib. We're very encouraged to see activity like this, and it builds on our hypothesis of improved efficacy. Next, we have a fifth-line patient with over 10 years of CML treatment. This patient saw all first and second-generation TKIs before losing their response. After just three cycles of TERN-701, this patient rapidly achieved deep molecular response, which is even better than major molecular response. This deep molecular response demonstrates rapid rescue of a heavily pretreated patient with a high baseline leukemic burden. Furthermore, we believe this activity bodes well for the type of rapid and compelling activity that we will see as we move our studies into earlier line patients. So the efficacy signals shared in the prior pages are supported by 701's high potency. In this cell proliferation assay, 701 demonstrated numerically greater potency versus asciminib against BCR-ABL variants, including active site and myristate pocket mutations. We believe this potency advantage, when added to better PK, plays an important role in why we are seeing a rescue effect and have opportunity to surpass asciminib on efficacy. Turning to safety, I'll give an abbreviated summary of the findings here on the slide. Again, we said no dose-limiting toxicities or AE-related treatment discontinuations, no grade three or higher treatment-related AEs or treatment-related SAEs, no meaningful changes in LFTs, amylase, or lipase, or clinically meaningful changes in blood pressure, ECG, or other vitals. One parameter that can be compared to asciminib at this early time point is the incidence of dose-limiting toxicities in dose escalation. Both drugs had an initial evaluation period of 28 days, which is typical in initial oncology trials. This is an assessment of safety based primarily on incidence of treatment-related grade three or greater AEs during the first cycle of treatment. Both TERN-701 and asciminib used similar DLT criteria to assess incidence of DLTs over the 28 days of treatment. As you can see, TERN-701 showed no DLTs throughout the dose range, while asciminib had multiple non-hematologic DLTs at different dose levels. No observed DLTs throughout the entire dose range supports the potential for TERN-701 to have a differentiated safety profile. Switching to improved convenience, we have shown that 701 can be dosed once daily without regard to food. The PK profile on the left supports once daily dosing with linear PK and a median half-life of eight to 14 hours compared to asciminib's five to nine hours. On the right, we have shown no clinically significant difference in exposure when dosed with food. For comparison, asciminib has a 60% decrease in exposure with food. On both these fronts, we think these can provide improved convenience to the patient and ultimately drive greater compliance and efficacy. So based on the emerging data, we have conviction that TERN-701 could be the best drug for all CML patients and will be the best option for frontline patients. We have multiple programs underway to support rapidly moving towards a registration trial, including our dose expansion, which will start in the first half of this year. I will note that getting to market is a well-trodden path in CML that is well within our capabilities as a company. The next data readout will be in the fourth quarter of this year, where we will provide data from a larger number of patients and those with longer treatment durations. As discussed, this will include data on six-month MMR rates, which serves as a first read-through to our registrational endpoint in CML, so CML is a large and growing market at over $5 billion in sales today and over 100,000 patients on therapy in the G7. 17,000 are newly diagnosed each year, and with signs of greater efficacy and differentiated safety and convenience, we think we can compete for a significant share of frontline patients. Beyond frontline, there are 15,000 second-line patients switching to a new therapy. Many of these patients have failed a generic active site inhibitor in the frontline. In those cases, physicians will likely want to switch classes and choose the best allosteric inhibitor. Note that we have already shown compelling rescue effects in our trial of patients who have failed an active site TKI and responded to TERN-701. Overall, we are encouraged that TERN-701 can be the best treatment for CML, particularly when physicians and patients are choosing an allosteric and are moving quickly to get to market. So Jay, switching gears, I would love to talk about our oral GLP-1 receptor agonist for obesity. So in our first-in- human study, we showed a profile that's well-positioned for additional differentiation in phase II. We saw significant, and I would say at the higher end of the dose range, of weight loss over 28 days with once daily dosing. There were unremarkable safety findings. It was well tolerated despite rapid titration every three days to target doses at the highest dose range. And we have distinct drug properties that we've talked about that enable sustained target coverage and a flat PK curve. This may lead to a differentiated clinical profile in subsequent studies, really around tolerability that we'll talk about. With that, we feel like we have the potential to be a leading GLP-1 receptor agonist, and we're starting our trial shortly, early in the second quarter. To briefly talk about the study that we conducted and the data, we had an efficient design. We explored a wide dose range from 240 mg-740 mg in the multiple ascending dose cohorts. We had non-diabetic patients with obesity or overweight, and the study was run at a phase I unit in the U.S. This is important. If you look at the PK, we see a differentiated profile that supports once daily dosing. 601 achieved full absorption at 240 mg and above with a relatively flat curve, which we believe will translate to better tolerability in longer-term studies. I'll show you next how this translated into efficacy. 601 showed dose-dependent 28-day mean weight loss up to 5.5%. This is on the upper end of the range for single-agent GLP-1 receptor agonists in 28-day studies. The curves were well separated with no signs of plateau. So I want to reemphasize how important it is to calibrate our TERN-601 data in the context of the rapid speed of dose titration. At 240 mg, titration was weekly. We saw such good tolerability that we set the titration to every three days at 500 mg and 740 mg. Based on what we've seen, this is the fastest titration conducted in a 28-day study. We were not trying to optimize tolerability in this short study, but to challenge the tolerability of the drug to inform this next phase of development. So again, despite the challenge of this fast titration, participants in the study tolerated it well and did not have to discontinue or ask for dose reductions or interruptions. At the lowest dose, there was no nausea or vomiting. There were no severe or serious AEs and no clinically meaningful changes in liver enzymes. The majority of GI-related AEs were mild, and overall, it was well- tolerated with unremarkable safety findings. This suggests the potential for a differentiated tolerability profile in our next study where we will slow down the titration. So when we compare the results of our 28-day study with those of other oral GLP-1 receptor agonists, we see that no other drug had these tolerability outcomes with such a fast titration schema. When we presented the data in October, we talked about the differentiated drug properties of TERN-601 that support our belief in its potential as a highly tolerable agent with competitive efficacy. At a high level, we believe the difference is the relatively higher drug levels in the gut versus the plasma that drives efficacy and avoids the exposure spikes in the plasma that likely cause GI tolerability issues, so turning to next steps, we're initiating our phase II early in the next quarter. Part A is a 12-week study that we'll read out in the second half of this year. It's designed to evaluate efficacy, safety, and tolerability with different titration regimens and inform a longer duration Part B arms of the study. We'll be particularly interested in whether slowing the titration can yield a superior tolerability profile with respect to other oral GLP-1s. We plan to have more to say about trial design and expectations for the study as we approach study start, so please stay tuned on that. So I'll begin to wrap up by touching on financials. Terns has over $370 million of cash, providing over three years of cash runway and supporting multiple critical milestones for 701, 601, and more. And in conclusion, it's going to be an exciting year at Terns with our two potentially best-in-class molecules and two blockbuster indications with these two meaningful readouts in the second half of this year. Both programs have compelling phase I data for us to build on in 2025. 701 will have data that includes six-month MMR, which was a read-through to our registrational endpoint, and TERN-601 12-week phase II readout will provide meaningful data on our differentiation hypothesis. So together, we believe 2025 will be a significant year for Terns as we solidify our competitive positioning and deliver on these two transformational catalysts. And with that, I will say thanks to you, Jay, and to the audience for your attention, and I will turn it back to you for Q&A with me and Emil. Okay, great. Thank you so much, Amy. Amy, that was a super comprehensive and informative update. So thank you for bringing us up to speed on all the impressive work you guys are doing at Terns. Maybe just to start off on TERN-701, based on the potential for what I'm going to call a trifecta: best-in-class efficacy, safety, and convenience, can you talk about how that profile would translate into patient experience in terms of quality of life or any other patient-reported outcomes you're collecting? Emil, would you like to take that one? No, certainly. Great question, Jay. And I think that you hit it on the head in terms of what the realignment need now is for these patients. It is quality of life. And the first step towards that is minimizing the AE profile substantially from what you see with the active site drugs. Just to give you some numbers, for any given frontline patient that starts a new drug, a new TKI with an active site drug, about 40% is about a 40%-50% chance that they'll have to switch. About half of frontline patients need to switch their therapy over the course of the duration. And that's because of AEs. And the flavor of AEs varies depending on which TKI you're talking about. For example, dasatinib, a third of patients get pleural effusions or other pulmonary issues. Bosutinib, it's GI issues. Nilotinib, there's vascular issues. For a patient that has to take these drugs effectively for the rest of their lives, tolerability is paramount because you know that on the efficacy front, these drugs work. They all work. No drug has shown a survival advantage over Gleevec. Yet there's so much cycling, and you saw it in the anecdotes that Amy shared about how frequently these patients have to switch. So that's really the benefit of allosterics as a class is that because of not only the superior efficacy, the superior safety, both of those arise from the exquisite selectivity that these molecules are able to achieve on the target because the myristate pocket is effectively unique to that fusion protein and shared by very little other proteins compared to the ATP- binding site. So as a result, now you can hit the target much harder than you can with the active site without the liability of the AEs that lead to these quality of life issues and switching. What does that mean? That means if you have the best-in-class allosteric that differentiates on all these fronts, now you can drive these patients deeper into molecular responses that allow them to maintain those responses and keep them on drug without the tolerability issues, and then therefore improve the median duration of treatment substantially. And that's what we think is the key advantage of 701, to be the best in class within the best class, which is now clearly shown to be allosterics in the disease. Okay, great. That's super helpful. Thank you, Emil. Then maybe just one follow-up that we get a lot from investors is about the potential to run a comparative study where you might be able to demonstrate superiority for TERN-701 versus asciminib in terms of patient-reported outcomes. Yeah, I mean, you know from a regulatory standpoint, we don't need to go head-to-head against asciminib to get this drug to the market to approval. And asciminib has already shown both in the third line and now recently in the frontline that the efficacy is superior to the active sites on both the Gleevec and the 2G- TKIs, as well as safety. So if we demonstrate the same thing with 701 versus the active site drugs, but achieve a larger differential in that efficacy profile in terms of response rate, that automatically tells people, including clinicians and patients, that you have a better efficacy profile without having to go directly head-to-head to get to approval. However, that being said, there's lots of opportunities to do what you described in terms of other avenues by which you can collect real-world data or even through the course of development, explore patient-reported outcomes in the context of studies that you can do to essentially show that the tolerability and the convenience factor are important. And I think I'll point to the two things that we've already shown. The food effect is the major one there. Again, in a context of patients having to take lifelong therapy, especially in the context of asciminib having to be dosed twice daily in several regions. So for example, in several European countries, the QD dosing is not approved. And so patients have to take it twice a day, but also fast three hours around each dose, which makes it very challenging for patients, right? And so that itself can be a very meaningful PRO. The other piece is we don't have to reinvent the wheel here. This has already been shown with the other TKIs that TKIs that are once daily without food effect are much more preferred by patients than otherwise. So we're already building on a lot of data in terms of patient-reported outcomes to know where to land with this drug. Okay, great. That's super helpful. Yes, it's nice to hear that you have so much optionality around the development plans for 701. Maybe shifting gears to 601 in the couple of minutes remaining. There was some updated FDA guidance on the development of drugs for treatment of obesity. Was there anything in there that helped shape your phase II plans and influenced anything that you put in the study designed for phase II to be prepared for phase III? Well, yeah, so from that standpoint, the answer is that the regulatory guidance was helpful in terms of seeing where the FDA at least sets the threshold for a bar. I think it was meaningful that they pointed out the 5% as sort of a minimum threshold in terms of the weight loss. The fact that we're already achieving that in the context of a 28-day study already puts us in a good position that we can clearly achieve that going into longer-term studies. The other element was that they did mention that it's versus placebo. So the fact that they're not requiring an active control arm is also important to note from a development standpoint. And so putting all that together, knowing what we see with the drug in a 28-day study, effectively, our goal here is to really achieve a target product profile of the best tolerated oral GLP-1. And I think the data that we saw in phase I, given how fast we titrated and yet getting to a profile of zero discontinuations or dose interruptions for that matter, puts us in a very good position. And when we go to a more standard titration schedule going into 12 weeks and beyond, that tolerability profile is only going to improve. We know that all these drugs achieve fairly comparable weight loss at any of these time points. At the 12-week time point, most drugs, if not all, have achieved around 6%-8% placebo-adjusted weight. So we're in that same range, but we really show much better tolerability and more convenience as measured by less steps in titration, which, again, our phase I data read through to that. I think we'll have a very differentiated profile. Okay, great. Yeah, we'll look forward to the study design. I think you already have a super clean tolerability profile, so I'm sure with more gradual titration, it'll look even better. I guess another thing that we get asked about is, will you also look at the potential for lower maintenance dosing beyond the initial weight loss? Yeah, no, I think maintenance dosing is certainly a very valuable use case for the orals. And I think that's something that we can certainly explore, and that would be something that 701 is uniquely- positioned to achieve, again, because of the relatively simpler titration, right? I think one of the key factors you have to think about is in a patient that's plateaued on any given injectable, if they want to switch to an oral for maintenance, is there a window for which they can discontinue that injectable before having to retitrate a new drug that's an oral? And so if patients, for example, stop an injectable and then wait a month before switching to a maintenance, they might have to retitrate because the drug is too low in their system to then restart. So a drug where you might not need to titrate that much or get to two or three-step titration or potentially no titration at all would be very, very differentiating in that regard. But those are all just other potential use cases where 701 can really differentiate. Okay, makes sense. Yeah, I'll just add to that, Jay, and say we see significant we think that's still really the early days for oral GLP-1 receptor agonists. The products that have been in development have some serious gaps in terms of tolerability, in terms of titration, multiple steps. And as we talk to patients and we talk to physicians, we really see a need for simplification. This is a primary care market that can't have patients calling and being actively managed every day with, "What do I do about this? What do I do about this? Oh, I missed this titration step. Now, what do I do?" type of thing. So we see a real opportunity to put forth a drug with competitive weight loss that doesn't have some of those concerns and think there's a real opportunity. And at our lowest dose in our 28-day study, we saw incredibly good tolerability, yet we saw good PD effects. Okay, sounds great. We'll look forward to your phase II study results later this year. With that, we'll wrap things up. Thank you so much, Amy and Emil, for joining us here today. It's been great. Thank you, Jay. Learning about all the impressive progress you're making on behalf of patients. So thank you so much for your time. Thanks, Jay. Thanks for the invitation. Our pleasure. Thank you. Take care. Bye-bye. Thanks. Bye-bye. Talk to you.