This Biotech Attracted a $181 Million Investment During a Staggering 1,300% Stock Rally

By Jonathan Ponciano – Mar 16, 2026 at 7:53PM ESTKey PointsVestal Point acquired 4,500,000 shares of Terns Pharmaceuticals in the fourth quarter.The quarter-end position value increased by $181.80 million as a result of this purchase, which created a new stake for the fund.This new stake made up 6.7% of fund AUM.On February 17, 2026, Vestal Point Capital disclosed a new position in Terns Pharmaceuticals (TERN 0.97%), acquiring 4,500,000 shares worth $181.80 million.What happenedAccording to a U.S. Securities and Exchange Commission (SEC) filing dated February 17, 2026, Vestal Point Capital established a new position in Terns Pharmaceuticals by purchasing 4,500,000 shares. The quarter-end value of the stake stood at $181.80 million.What else to knowTop five holdings after the filing:NASDAQ:ABVX: $256.22 million (9.4% of AUM)NASDAQ:ACLX: $190.71 million (7.0% of AUM)NASDAQ: TERN: $181.80 million (6.7% of AUM)NASDAQ:BMRN: $178.29 million (6.5% of AUM)NYSE:GMED: $111.32 million (4.1% of AUM)As of Monday, shares of Terns Pharmaceuticals were priced at $46.07, up a staggering 1,300% over the past year and significantly outperforming the S&P 500’s roughly 19% gain in the same period.Company overviewMetricValuePrice (as of Monday)$46.07Market Capitalization$5 billionNet Income (TTM)($94.44 million)Company snapshotTerns Pharmaceuticals develops small-molecule therapeutics targeting non-alcoholic steatohepatitis (NASH), obesity, and related metabolic diseases, with a pipeline including TERN-101, TERN-201, TERN-501, and TERN-601 in various clinical stages.It operates a clinical-stage biopharmaceutical business model, generating value through research, development, and potential future commercialization or licensing of proprietary drug candidates.Its primary customers are expected to be healthcare providers, hospitals, and patients affected by NASH, obesity, and metabolic disorders, pending successful clinical development and regulatory approval.Terns Pharmaceuticals is a clinical-stage biotechnology company focused on developing novel small-molecule therapies for NASH and metabolic diseases. The company leverages a differentiated pipeline with multiple candidates in Phase I and II trials, aiming to address significant unmet medical needs in liver and metabolic health. Its strategy centers on advancing proprietary assets through clinical development to establish a competitive position in the biopharmaceutical sector.What this transaction means for investorsHuge gains sometimes scare off institutional investors, but that wasn’t at all the case here.Terns is building a pipeline of small molecule therapies targeting some of the largest and fastest growing markets in medicine, including obesity, metabolic disease, and certain cancers. The metabolic opportunity alone has become one of the most competitive areas in drug development as demand for weight loss and liver disease therapies continues to surge globally.According to the firm’s latest investor presentation, Terns’ pipeline spans multiple programs, including TERN-501 for metabolic liver disease and TERN-701, an allosteric BCR-ABL inhibitor being developed for chronic myeloid leukemia. Early clinical data has shown encouraging molecular response rates, and the company expects pivotal trials for TERN-701 to begin in the coming years if development continues successfully.The company also enters this stage with an unusually strong balance sheet for a clinical-stage biotech. Management has indicated roughly $1 billion in cash and marketable securities, enough to fund operations and potential clinical milestones well into the next decade. With this pretty massive bet, it seems like Vestal Point is betting on that pipeline to convert.About the AuthorJonathan Ponciano is a contributing stock market analyst at The Motley Fool. He has nearly a decade of experience as a financial journalist, most recently as an editor and senior reporter at Forbes focused on markets, technology, and entrepreneurship. Jonathan has also written for Investopedia and the Los Angeles Business Journal. He holds a dual B.A. in Business Journalism and Economics from the University of North Carolina at Chapel Hill and an M.B.A. from Columbia Business School. A North Carolina native now based in New York City, Jonathan has also lived in Mexico City and Los Angeles.CMFjonponcStocks MentionedTerns PharmaceuticalsNASDAQ: TERN$46.07(-0.97%)-$0.45*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.