Merck: 'Strong Buy' - Terns Acquisition And Ability To Counter Keytruda Patent Loss

Merck retains a 'strong buy' rating, driven by proactive oncology pipeline expansion to offset KEYTRUDA patent expiration in 2028. Acquisition of Terns Pharmaceuticals brings TERN-701, a best-in-disease oral BCR-ABL1 TKI for CML, with multibillion-dollar potential and recent FDA Breakthrough Therapy Designation. The company advances the KEYTRUDA family with QLEX SC formulation and combination therapies, targeting new PDUFA approvals in bladder and renal cancers through 2026.