Pharma M&A: bulking up cancer pipelines

Merck's R&D spending as percentage of revenue will increase by 50-100 basis points in fiscal 2025 due to integration of Terns' development programs and pipeline advancement costs

Merck's oncology revenue segment will grow at ≥8% year-over-year in the next 2 fiscal years (2025-2026) as Terns' pipeline assets contribute to marketed products and late-stage development candidates

Merck's acquisition of Terns Pharmaceuticals will drive MRK stock outperformance by at least 5% relative to S&P 500 within 90 days post-announcement due to positive market sentiment toward cancer pipeline expansion