ORBIMED Advisors Trims $125 Million Terns Stake After a Breakout Year, According to SEC Filing

What happened

According to a SEC filing dated February 17, 2026, ORBIMED Advisors LLC sold 5,409,671 shares of Terns Pharmaceuticals (TERN +0.28%), an estimated $125.01 million transaction based on the average closing price for the quarter ending December 31, 2025. The fund finished the period holding 2,153,300 shares, with the value of its position decreasing by $30.20 million, a figure that accounts for both share sales and price changes.

What else to know

After this sell, the Terns Pharmaceuticals position represents 1.78% of ORBIMED Advisors LLC’s 13F reportable AUM

Top holdings after the filing:

• NASDAQ: EWTX: $385.09 million (7.9% of AUM)
• NYSE: LLY: $323.69 million (6.7% of AUM)
• NYSE: BSX: $230.68 million (4.7% of AUM)
• NASDAQ: SVA: $184.47 million (3.8% of AUM)
• NYSE: EW: $157.11 million (3.2% of AUM)

As of February 17, 2026, shares were priced at $39.58, up 858.4% over the past year, outperforming the S&P 500 by 862.96 percentage points

Company overview

Company snapshot

Terns Pharmaceuticals is a clinical-stage biotechnology company specializing in the development of novel therapies for liver and metabolic diseases. The company leverages a focused pipeline of small-molecule candidates to address significant unmet medical needs in NASH and obesity. Its strategy centers on advancing differentiated assets with strong liver distribution and metabolic stability, positioning the company for potential leadership in targeted metabolic therapeutics.

The company also develops small-molecule therapies targeting non-alcoholic steatohepatitis (NASH) and metabolic diseases, with key candidates including TERN-101, TERN-201, TERN-501, and TERN-601 in various clinical trial phases.

The company’s primary customers are anticipated to be healthcare providers, pharmaceutical partners, and patients with NASH, obesity, and related metabolic conditions.

What this transaction means for investors

Terns Pharmaceuticals has posted a sharp multi-month rally, pushing its valuation to reflect significant confidence in its clinical pipeline. When expectations climb that high in a development-stage biotech, risk and reward both expand. ORBIMED Advisors reduced its position in the fourth quarter, selling about 5.41 million shares for $125 million while retaining a smaller stake.

As a clinical-stage biotech, Terns is valued based on its pipeline potential rather than current sales. The company is developing small molecule candidates for NASH and other metabolic diseases, including obesity, with programs such as TERN 101, TERN 201, TERN 501, and TERN 601 in various trial phases. Rapid stock appreciation reflects the market’s anticipation of future success, which makes the next round of trial data even more important.

Moving forward, investors should focus on Terns’ clinical data and balance sheet strength. Upcoming trial results will determine whether the pipeline justifies the current valuation, especially regarding safety and differentiation from competitors. Cash burn and runway are also important, as development-stage biotechs often need additional funding before commercialization. In biotech, strong data sustains valuation, while dilution can unwind it quickly.