0000950170-22-002962 | 10-K | XBRL Viewer | Terns Pharmaceuticals INC

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Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 47,699	$ 74,854
Marketable securities	118,283	0
Notes receivable	0	12,718
Deferred offering costs	0	2,137
Prepaid expenses and other current assets	948	1,160
Total current assets	166,930	90,869
Property and equipment, net	1,046	1,175
Other assets	94	246
Total assets	168,070	92,290
Current liabilities:
Accounts payable	2,126	935
Accrued expenses and other current liabilities	4,694	9,006
Loans payable	0	12,880
Total current liabilities	6,820	22,821
Deferred rent, net of current portion	160	220
Taxes payable, non-current	787	657
Total liabilities	7,767	23,698
Commitments and contingencies
Convertible preferred stock, $0.0001 par value; 10,000,000 and 188,029,084 shares authorized as of December 31, 2021 and 2020, respectively; no shares issued and outstanding as of December 31, 2021; 12,958,452 shares issued and outstanding as of December 31, 2020	0	186,033
Stockholders’ equity (deficit):
Common stock, $0.0001 par value, 150,000,000 and 299,700,000 shares authorized at December 31, 2021 and 2020, respectively; 25,269,271 and 337,508 shares issued and outstanding at December 31, 2021 and 2020, respectively	3	0
Additional paid-in capital	342,711	14,598
Accumulated other comprehensive loss	(338)	(124)
Accumulated deficit	(182,073)	(131,915)
Total stockholders' equity (deficit)	160,303	(117,441)
Total liabilities, convertible preferred stock and stockholders equity	$ 168,070	$ 92,290

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2021	Dec. 31, 2020
Statement Of Financial Position [Abstract]
Convertible preferred stock, par value	$ 0.0001	$ 0.0001
Convertible preferred stock,authorized	10,000,000	188,029,084
Convertible preferred stock, shares issued	0	12,958,452
Convertible preferred stock, shares outstanding	0	12,958,452
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, authorized	150,000,000	299,700,000
Common stock, shares issued	25,269,271	337,508
Common stock, shares outstanding	25,269,271	337,508

Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Revenue:
License revenue	$ 1,000	$ 0
Operating expenses:
Research and development	31,311	28,029
General and administrative	19,549	8,996
Total operating expenses	50,860	37,025
Loss from operations	(49,860)	(37,025)
Other income (expense):
Interest income	170	55
Change in fair value of loans payable	0	(2,887)
Other income, net	40	99
Total other income (expense), net	210	(2,733)
Loss before income taxes	(49,650)	(39,758)
Income tax expense	(508)	(813)
Net loss	(50,158)	(40,571)
Extinguishment of Series B convertible preferred stock	0	10,701
Net loss attributable to non-controlling interest	0	(518)
Net loss attributable to common stockholders	$ (50,158)	$ (29,352)
Net loss per share attributable to common stockholders, basic and diluted	$ (2.21)	$ (102.93)
Weighted average common stock outstanding, basic and diluted	22,705,948	285,162
Other comprehensive loss:
Net loss	$ (50,158)	$ (40,571)
Unrealized loss on available-for-sale securities, net of tax	(194)	0
Foreign exchange translation adjustment, net of tax	(20)	(18)
Comprehensive loss	(50,372)	(40,589)
Less: Comprehensive loss attributable to non-controlling interest	0	(518)
Comprehensive loss attributable to common stockholders	$ (50,372)	$ (40,071)

Consolidated Statements of Noncontrolling Interest, Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	LAV Option Exercise	Noncontrolling Interest	Noncontrolling Interest LAV Option Exercise	Common Stock	Additional paid-in capital	Additional paid-in capital LAV Option Exercise	Accumulated Other Comprehensive Loss	Accumulated deficit	Series A convertible preferred stock	Series A convertible preferred stock LAV Option Exercise	Series B convertible preferred stock	Series B convertible preferred stock LAV Option Exercise	Series B convertible preferred stock Additional paid-in capital	Series C convertible preferred stock	Series C convertible preferred stock Bridge Loan	Series C convertible preferred stock 2020 convertible promissory notes	Series C convertible preferred stock Additional paid-in capital Bridge Loan	Series C convertible preferred stock Additional paid-in capital 2020 convertible promissory notes
Balances at Dec. 31, 2019	$ (90,760)		$ 14,117			$ 1,208		$ (106)	$ (91,862)
Balance at Beginning of period at Dec. 31, 2019										$ 21,938		$ 73,029
Balance at Beginning of period (in shares) at Dec. 31, 2019										2,089,285		2,384,195
Balance at Beginning of period (in shares) at Dec. 31, 2019					215,890
Exercise of stock options	120	$ (1,130)		$ (13,599)		120	$ (1,130)				$ 8,062		$ 6,667
Exercise of stock options (in shares)					38,285						767,857		216,450
Vesting of restricted stock	23					23
Vesting of restricted stock (in shares)					83,333
Stock-based compensation expense	1,691					1,691
Issuance of Series C convertible preferred stock, net of issuance costs of $330, value															$ 69,170
Issuance of Series C convertible preferred stock, net of issuance costs of $330, shares															5,966,686
Conversion of securities to convertible preferred stock																$ 216	$ 1,769	$ 216	$ 1,769
Temporary equity, conversion of securities to convertible preferred stock, value																$ 1,947	$ 15,921
Temporary equity, conversion of securities to convertible preferred stock, shares																167,159	1,366,820
Temporary equity, extinguishment of Series B convertible preferred stock, value												$ (79,696)
Temporary equity, extinguishment of Series B convertible preferred stock, shares												(2,600,645)
Extinguishment of Series B convertible preferred stock, value												$ 10,701		$ 10,701
Temporary equity, reissuance of Series B convertible preferred stock, value												$ 68,995
Temporary equity, reissuance of Series B convertible preferred stock, shares												2,600,645
Foreign exchange translation adjustment	(18)							(18)
Net loss	(40,053)		$ (518)						(40,053)
Balances at Dec. 31, 2020	(117,441)					14,598		(124)	(131,915)
Balance at End of period at Dec. 31, 2020	$ 186,033									$ 30,000		$ 68,995			$ 87,038
Balance at end of period (in shares) at Dec. 31, 2020	12,958,452									2,857,142		2,600,645			7,500,665
Balance at end of period (in shares) at Dec. 31, 2020					337,508
Conversion of preferred stock to common stock upon closing of the initial public offering	$ 186,033				$ 2	186,031
Temporary equity, conversion of convertible preferred stock into common stock upon closing of the initial public offering (in shares)										(2,857,142)		(2,600,645)			(7,500,665)
Temporary equity, conversion of convertible preferred stock into common stock upon closing of the initial public offering										$ (30,000)		$ (68,995)			$ (87,038)
Conversion of preferred stock to common stock upon closing of the initial public offering (in shares)					16,079,230
Sale of common stock in initial public offering, net of issuance costs	133,023				$ 1	133,022
Sale of common stock in initial public offering, net of issuance costs (in shares)					8,625,000
Exercise of stock options	914					914
Exercise of stock options (in shares)					156,104
Vesting of restricted stock (in shares)					71,429
Stock-based compensation expense	8,146					8,146
Unrealized loss on available-for-sale securities	(194)							(194)
Foreign exchange translation adjustment	(20)							(20)
Net loss	(50,158)								(50,158)
Balances at Dec. 31, 2021	160,303				$ 3	$ 342,711		$ (338)	$ (182,073)
Balance at End of period at Dec. 31, 2021	$ 0
Balance at end of period (in shares) at Dec. 31, 2021	0
Balance at end of period (in shares) at Dec. 31, 2021					25,269,271

Consolidated Statements of Noncontrolling Interest, Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Statement Of Stockholders Equity [Abstract]
Stock issuance cost	$ 3,339	$ 330

Consolidated Statements of Cash Flows $ in Thousands	12 Months Ended
Consolidated Statements of Cash Flows $ in Thousands	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Cash flows from operating activities:
Net loss	$ (50,158)	$ (40,571)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	8,146	1,691
Depreciation and amortization expense	512	394
Amortization on marketable securities, net	879	37
Change in fair value of convertible notes	0	2,887
Change in deferred taxes and uncertain tax positions	219	693
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	238	1,389
Other assets	37	102
Accounts payable	1,727	(1,146)
Accrued expenses and other current liabilities	(3,367)	4,780
Deferred rent	(60)	(65)
Net cash used in operating activities	(41,827)	(29,809)
Cash flows from investing activities:
Purchase of property and equipment	(340)	(584)
Purchase of investments	(166,297)	(715)
Proceeds from sales and maturities of investments	46,941	7,992
Net cash (used in) provided by investing activities	(119,696)	6,693
Cash flows from financing activities:
Net proceeds from initial public offering	136,362	0
Proceeds from notes receivable	12,718	0
Payment of loans payable	(12,880)	0
Payment of deferred offering costs	(2,721)	(858)
Proceeds from stock option exercises	914	120
Proceeds from issuance of loans payable	0	16,876
Net proceeds from issuance of Series C convertible preferred stock	0	69,377
Net cash provided by financing activities	134,393	85,515
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(25)	80
Net (decrease) increase in cash, cash equivalents and restricted cash	(27,155)	62,479
Cash, cash equivalents and restricted cash at beginning of period	74,854	12,375
Cash and cash equivalents at end of period	47,699	74,854
Supplemental disclosure of cash flow information:
Cash paid for taxes	238	178
Supplemental disclosure of noncash investing and financing activities:
Conversion of preferred stock to common stock upon closing of the initial public offering	186,033	0
Purchases of property and equipment on trade vendor credit	38	0
LAV Option exercise	0	13,599
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock	0	17,690
Conversion of Bridge Loan to Series C convertible preferred stock	0	2,163
Extinguishment of Series B convertible preferred stock	0	10,701
Deferred offering costs and Series C offering costs within accounts payable and accrued expenses	$ 0	$ 1,519

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies

Nature of the Business

Terns Pharmaceuticals, Inc. (Terns) is a clinical-stage biopharmaceutical company developing a portfolio of small-molecule single-agent and combination therapy candidates to address serious diseases such as non-alcoholic steatohepatitis (NASH) and obesity.

Terns was incorporated as an exempted company in the Cayman Islands in December 2016. In December 2020, the Company effected a de-registration of the Company in the Cayman Islands and a domestication in the State of Delaware (the "Domestication"), pursuant to which it became a Delaware corporation. Terns owns all of the share capital of Terns Pharmaceutical HongKong Limited (Terns Hong Kong) and Terns, Inc., a Delaware corporation (Terns U.S. Opco). Terns Hong Kong holds all of the share capital of Terns China Biotechnology Co., Ltd. (organized in Shanghai, People’s Republic of China (PRC)) (Terns China) and Terns (Suzhou) Biotechnology Co., Ltd. (organized in Suzhou, PRC) (Terns Suzhou).

The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions.

Basis of Presentation

The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and include the accounts of Terns and its wholly owned subsidiaries Terns U.S. Opco and Terns Hong Kong and its wholly owned subsidiaries Terns China and Terns Suzhou. Prior period reflects a variable interest in Terns China in which Terns had a majority interest and was the primary beneficiary. The noncontrolling interest attributable to the Company’s variable interest entity (VIE) is presented as a separate component from stockholders’ equity (deficit) in the consolidated balance sheets, and a noncontrolling interest in the consolidated statements of operations and comprehensive loss and consolidated statements of noncontrolling interest, convertible preferred stock and stockholders’ equity (deficit). The Company’s consolidated financial statements have been prepared in conformity with U.S. GAAP. All intercompany balances and transactions have been eliminated in consolidation.

Initial Public Offering

In February 2021, the Company completed an initial public offering (the “IPO”) of 8,625,000 shares of its common stock, including the exercise in full by the underwriters of their option to purchase up to 1,125,000 additional shares of common stock, for net proceeds of $133.0 million, after deducting underwriting discounts and commissions and offering expenses, and its shares started trading on the Nasdaq Global Select Market under the ticker symbol “TERN.” Upon closing of the IPO, all of the Company's outstanding shares of convertible preferred stock automatically converted into an aggregate of 16,079,230 shares of common stock.

Certificate of Incorporation

Prior to the IPO, the Company’s certificate of incorporation adopted in December 2020 in connection with the Domestication (the “December 2020 Charter”) authorized the Company to issue the following shares of capital stock: (i) 299,700,000 shares of common stock, (ii) 40,000,000 shares of Series A convertible preferred stock, (iii) 36,409,088 shares of Series B convertible preferred stock, and (iii) 111,619,996 shares of Series C convertible preferred stock. All classes of stock under the December 2020 Charter were authorized at a par value of $0.0001.

In February 2021, the Company’s amended and restated certificate of incorporation filed with the Secretary of State of the State of Delaware became effective in connection with the closing of the IPO. Under the amended and restated certificate of incorporation, the Company is authorized to issue 150,000,000 shares of common stock and 10,000,000 shares of preferred stock. All classes of stock have a par value of $0.0001.

Reverse Stock Split

In January 2021, the Company filed an amended and restated certificate of incorporation to effectuate a reverse split of shares of the Company’s common stock and convertible preferred stock on a 1-for-14 basis (the “Reverse Stock Split”). The par value and the number of authorized shares of the convertible preferred stock and common stock were not adjusted as a result of the Reverse Stock Split. All issued and outstanding common stock, options to purchase common stock and per share amounts contained in the consolidated financial statements have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented.

Variable Interest Entity

The Company consolidates a VIE where it has been determined that the Company is the primary beneficiary of the entity’s operations. The Company has considered its relationships with a certain entity to determine whether the Company has a variable interest in that entity, and if so, whether the Company is the primary beneficiary of the relationship. U.S. GAAP requires VIEs to be consolidated if an entity’s interest in the VIE is a controlling financial interest. Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the power to direct the activities of the VIE that most significantly impacts the VIE’s economic performance and (ii) the obligations to absorb losses that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE.

Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. The consolidation status of a VIE may change as a result of such reassessments. Changes in consolidation status are applied prospectively in accordance with U.S. GAAP.

Impact of the COVID-19 Pandemic

The COVID-19 pandemic is rapidly evolving. The COVID-19 virus and new variants that emerge continue to impact countries worldwide, including the United States and China where the Company has business operations. The extent of the impact of the COVID-19 pandemic on business, operations and development timelines and plans remains uncertain, and will depend on certain developments, including the duration and spread of the outbreak and its impact on the Company’s development activities, planned clinical trial enrollment, future trial sites, contract research organizations (CROs), third-party manufacturers and other third parties with whom the Company conducts business, as well as its impact on regulatory authorities and the Company’s key scientific and management personnel. The ultimate impact of the COVID-19 pandemic or a similar health epidemic is highly uncertain and subject to change. To the extent possible, the Company is conducting business as usual, with necessary or advisable modifications to employee travel and to the on-site and in-person activities of the Company's personnel. The Company will continue to actively monitor the rapidly evolving situation related to the COVID-19 pandemic and may take further actions that alter the Company’s operations, including those that may be required by federal, state or local authorities in the United States and China, or that the Company determines are in the best interest of its employees and other third parties with whom the Company conducts business. At this point, the extent to which the COVID-19 pandemic may affect the Company’s business, operations and development timelines and plans, including the resulting impact on expenditures and capital needs, remains uncertain.

Summary of Significant Accounting Policies

Revenue Recognition

To determine revenue recognition for arrangements, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the goods and services it transfers to the customer. At contract inception, the Company assesses the goods or services promised within each contract, determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company enters into corporate collaborations under which it may obtain upfront license fees, research and development funding, and development, regulatory and commercial milestone payments and royalty payments. The Company’s performance obligations under these arrangements may include licenses of intellectual property, distribution rights, research and development services, delivery of manufactured product and/or participation on joint steering committees.

Licenses of intellectual property

If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenue from upfront license fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgement to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring proportional performance for purposes of recognizing revenue from non-refundable, upfront fees. The Company evaluates the measure of proportional performance each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition.

Milestone payments

At the inception of each arrangement that includes development, regulatory or commercial milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price. The Company considers two alternatives to use when estimating the amount of variable consideration: the expected value method and the most likely amount method. Under the expected value method, an entity considers the sum of probability-weighted amounts in a range of possible consideration amounts. Under the most likely amount method, an entity considers the single most likely amount in a range of possible consideration amounts. Whichever method is used, it should be consistently applied throughout the life of the contract; however, it is not necessary for the Company to use the same approach for all contracts. The Company expects to use the most likely amount method for development and regulatory milestone payments. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis. The Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability or achievement of each such milestone and any related constraint, and if necessary, adjusts its estimates of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment.

Commercial milestones and royalties

For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and in which the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue when the related sales occur. To date, the Company has not recognized any royalty revenue resulting from its collaboration arrangements.

Upfront payments and fees are recorded as deferred revenue upon receipt or when due and may require deferral of revenue recognition to a future period until the Company performs its obligations under these arrangements. Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period. Significant estimates and assumptions made in the accompanying consolidated financial statements include, but are not limited to, the estimates for accruals of research and development expenses, accrual of research contract costs, unrecognized tax benefits, fair value of common stock and stock option valuations. On an ongoing basis, the Company evaluates its estimates and judgments, using historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. Actual results could materially differ from those estimates.

Cash, Cash Equivalents and Marketable Securities

Cash and cash equivalents consist of standard checking accounts and money market funds. The Company considers all highly liquid investments with an original maturity of 90 days or less at the date of purchase to be cash equivalents.

The Company classifies as available-for-sale marketable securities with a remaining maturity when purchased of greater than three months. The Company’s marketable securities are maintained by investment managers and consist of U.S. government and non-U.S. government securities, corporate debt securities, and commercial paper. Debt securities are carried at fair value with the unrealized gains and losses included in other comprehensive loss as a component of stockholders’ equity (deficit) until realized. Any premium arising at purchase is amortized to the earliest call date and any discount arising at purchase is accreted to maturity. Amortization and accretion of premiums and discounts are recorded in interest income and/or expense. Realized gains and losses on debt securities are determined using the specific identification method and are included in other income (expense), net.

If any adjustment to fair value reflects a decline in value of the investment, the Company considers all available evidence to evaluate the extent to which the decline is “other-than-temporary” and, if so, marks the investment to market through a charge to the Company’s consolidated statements of operations and comprehensive loss.

The fair value and amortized cost of marketable securities by major security type as of December 31, 2021 is as follows:


	December 31, 2021
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	$	33,239	$	—	$	—		$	33,239
U.S. government securities		36,322		—		(130	)		36,192
Non-U.S. government securities		11,194		—		(12	)		11,182
Corporate debt securities		39,495		—		(52	)		39,443
Commercial paper		31,466		—		—			31,466
Total	$	151,716	$	—	$	(194	)	$	151,522

Classified as:
Cash equivalents								$	33,239
Marketable securities									118,283
Total								$	151,522

The Company did not have any marketable securities for the year ended December 31, 2020.

Classification of Convertible Preferred Stock and Presentation of Noncontrolling Interest

The holders of Series A, Series B and Series C convertible preferred stock, which were outstanding prior to the IPO, had certain liquidation rights in the event of a deemed liquidation that, in certain situations, were not solely within the control of the Company and would call for the redemption of the then outstanding convertible preferred stock. Therefore, the Series A, Series B and Series C convertible preferred stock were classified outside of shareholders’ equity (deficit) on the consolidated balance sheets as of December 31, 2020. In February 2021, upon the completion of the IPO, all the outstanding shares of convertible preferred stock converted into common stock and the Company does not have any shares of preferred stock outstanding.

The Company recognizes a noncontrolling interest related to VIEs in which the Company is the primary beneficiary as equity in the consolidated financial statements separate from the parent entity’s equity. The net loss attributable to noncontrolling interest is included in net loss in the consolidated statements of operations and comprehensive loss. Changes in the parent entity’s ownership interest in a subsidiary that do not result in deconsolidation are treated as equity transactions if the parent entity retains its controlling financial interest. In addition, when a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary will be initially measured at fair value and the difference between the carrying value and fair value of the retained interest will be recorded as a gain or loss.

Terns China was previously the Company’s VIE that was established as a financing subsidiary to allow investment by Lilly Asia Ventures (LAV) investment entities: Suzhou Litai Equity Investment Centre (Limited Partnership) (PRC) and Suzhou Lirui Equity Investment Centre (Limited Partnership) (PRC), collectively referred to as the “LAV PRC Entities”. The Company’s board of directors has the unilateral ability to control the Terns China board of directors. Net losses of the China Subsidiaries have been allocated based on their ownership percentage to the LAV PRC Entities’ noncontrolling interest and are reflected in the consolidated statements of operations and comprehensive loss. The noncontrolling interest is classified outside of stockholders’ equity (deficit) on the consolidated balance sheets as it is redeemable for cash based on an investor option after a specified date. In December 2020, the LAV PRC Entities exercised their option resulting in the conversion of all of the equity interests in Terns China held by the LAV PRC Entities into shares of the Company’s preferred stock (the “China Conversion”). Following the completion of the China Conversion, Terns China became a wholly owned subsidiary of the Company. The Company does not currently anticipate any further direct third-party investments into Terns China and Terns China will only act as an operating subsidiary for the Company’s business activities in China.

Research and Development Expenses

Research and development costs are expensed as incurred. Research and development expenses consist of costs incurred to discover, research and develop drug candidates, including personnel expenses, stock-based compensation expense, allocated facility-related and depreciation expenses, third-party license fees and external costs, including fees paid to consultants and contract research organizations, or CROs, in connection with nonclinical studies and clinical trials and other related clinical trial fees, such as for investigator grants, patient screening, laboratory work, clinical trial database management, clinical trial material management and statistical compilation and analysis. Non-refundable prepayments for goods or services that will be used or rendered for future research and development activities are recorded as prepaid expenses. Such amounts are recognized as an expense as the goods are delivered or the related services are performed, or until it is no longer expected that the goods will be delivered, or the services rendered. Costs incurred in obtaining technology licenses are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future uses.

The Company has from time to time entered into various research and development and other agreements with commercial firms, researchers, universities and others for provisions of goods and services. These agreements are generally cancelable, and the related costs are recorded as research and development expenses as incurred. The Company records accruals for estimated ongoing research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies or clinical trials, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ materially from the Company’s estimates. Since inception, the Company’s historical accrual estimates have not been materially different from the actual costs.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities included the following:


	December 31,
(in thousands)	2021		2020
Research and development costs	$	1,570	$	2,800
Accrued professional fees		363		2,185
Compensation and benefit costs		2,403		1,492
Accrued development milestone		—		1,531
Refundable contract liability		—		836
Other		358		162
Total accrued expenses and other current liabilities	$	4,694	$	9,006

Income Taxes

The provision for income taxes primarily relates to projected federal, state, and foreign income taxes. To determine the quarterly provision for income taxes, the Company uses an estimated annual effective tax rate, which is generally based on expected annual income and statutory tax rates in the various jurisdictions in which the Company operates. In addition, the tax effects of certain significant or unusual items are recognized discretely in the quarter during which they occur and can be a source of variability in the effective tax rates from quarter to quarter.

Income taxes are computed using the asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements. In estimating future tax consequences, the Company considers all expected future events including the enactment of changes in tax laws or rates. A valuation allowance is recorded, if necessary, to reduce net deferred tax assets to their realizable values if management does not believe it is more likely than not that the net deferred tax assets will be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, and ongoing prudent and feasible tax planning strategies in assessing the amount of the valuation allowance. When the Company establishes or reduces the valuation allowance against its deferred tax assets, its provision for income taxes will increase or decrease, respectively, in the period such determination is made.

The Company assesses accounting for uncertainty in income taxes by modeling for the recognition, measurement and disclosure in financial statements any uncertain income tax positions that the Company has taken or expects to take on a tax return. As of each balance sheet date, unresolved uncertain tax positions are reassessed. The Company accrues interest and related penalties, if applicable, on all tax exposures for which reserves have been established consistent with jurisdictional tax laws.

Common Stock Valuation

Due to the absence of an active market for the Company’s common stock prior to the completion of the IPO in February 2021, the Company utilized methodologies to estimate the fair value of its common stock. In determining the fair value of options granted prior to the IPO, the Company has considered the estimated fair value of the common stock as of the measurement date. The estimated fair value of the common stock prior to the IPO was determined at each grant date based upon a variety of factors, including:

•

the prices at which the Company sold shares of convertible preferred stock and the superior rights and preferences of the convertible preferred stock relative to its common stock at the time of each grant;

•

the progress of the Company’s research and development programs, including the status and results of clinical and nonclinical studies for its drugs;

•

the Company’s stage of development and commercialization and its business strategy;

•

external market conditions affecting the biotechnology industry and trends within the biotechnology industry;

•

the Company’s financial position, including cash on hand, and its historical and forecasted performance and operating results;

•

the lack of an active public market for the Company’s common stock and convertible preferred stock;

•

the likelihood of achieving a liquidity event, such as an IPO or sale of the Company in light of prevailing market conditions; and

•

the analysis of IPOs and the market performance of similar companies in the biotechnology industry.

Significant changes to the key assumptions underlying the factors used could have resulted in different fair values of common stock at each valuation date.

Comprehensive Loss

Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources.

Stock-Based Compensation

Stock-based compensation expense, including grants of stock options and restricted stock awards issued under the Company’s equity incentive plan and rights to acquire stock granted under the Company’s employee stock purchase plan (ESPP), is measured at the grant date based on the fair value of the awards and is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. The Company’s determination of the fair value of stock options with time-based vesting and rights to acquire stock under the ESPP utilizes the Black-Scholes option-pricing model. The Company lacks sufficient company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The Company estimates risk-free rates using the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term and dividend yield using the Company’s expectations and historical data. The Company uses the simplified method to calculate the expected term of stock option grants. Under the simplified method, the expected term is estimated to be the mid-point between the vesting date and the contractual term of the option. The fair value of each stock option grant and right to acquire stock under the ESPP is calculated based upon the Company’s common stock valuation on the date of the grant. The Company accounts for forfeitures of stock option grants as they occur.

Net Loss Per Share of Common Stock

The Company follows the two-class method when computing net income (loss) per share of common stock as the Company has issued shares that meet the definition of participating securities. The two-class method determines net income (loss) per share of common stock for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed.

Basic net income (loss) per share of common stock is computed by dividing the net income (loss) per share of common stock by the weighted average number of shares of common stock outstanding for the period. Diluted net income (loss) per share of common stock is computed by adjusting net income (loss) to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share of common stock is computed by dividing the diluted net loss by the weighted average number of shares of common stock outstanding for the period, including potential dilutive shares. For purposes of this calculation, outstanding stock options and convertible preferred stock are considered potential dilutive shares.

The Company’s convertible preferred stock outstanding prior to the IPO contractually entitled the holders of such shares to participate in dividends but did not contractually require the holders of such shares to participate in losses of the Company. Accordingly, in periods in which the Company reported a net loss, such losses were not allocated to such securities. In periods in which the Company reported a net loss, diluted net loss per share of common stock was the same as basic net loss per share of common stock, since dilutive shares were not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss for the years ended December 31, 2021 and 2020.

Deferred Offering Costs

The Company capitalizes certain legal, professional accounting and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated.

After consummation of the equity financing, these costs are recorded as a reduction to the carrying value of stockholders’ equity (deficit) as a reduction of additional paid-in capital or equity generated as a result of such offering. Should an in-process equity financing be abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the consolidated statements of operations and comprehensive loss.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives. The general range of useful lives of equipment is 3 to 5 years.

When assets are sold or retired, the cost and related accumulated depreciation are removed from the accounts, with any resulting gain or loss recorded in operating expenses in the consolidated statements of operations and comprehensive loss. Costs of repairs and maintenance are expensed as incurred.

Property and equipment, net consisted of the following:


		December 31,
(in thousands)	Estimated Useful Lives	2021			2020
Leasehold improvements	Shorter of remaining life of lease or useful life of asset	$	928		$	897
Furniture and fixtures	5 years		281			218
Computer equipment	3 years		202			156
Office equipment	5 years		102			41
Lab equipment	3 to 5 years		718			552
Property and equipment, gross			2,231			1,864
Less: Accumulated depreciation			(1,185	)		(689	)
Total property and equipment, net		$	1,046		$	1,175

The Company recognized depreciation expense related to these assets of $0.5 million and $0.4 million during the years ended December 31, 2021 and 2020, respectively.

Impairment of Long-Lived Assets

The Company’s long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset or asset group may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the future undiscounted cash flows expected to be generated by the asset or asset group. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. There were no impairments of long-lived assets for any of the periods presented.

Functional Currencies and Foreign Currency Translation

The Company’s reporting currency is U.S. dollars. The functional currency of Terns U.S. Opco and Terns H.K. is U.S. dollars, while the functional currency of Terns Suzhou and Terns China is the Chinese Yuan (CNY). Transactions denominated in other than the functional currencies are remeasured into the functional currency of the entity at the exchange rates prevailing on the transaction dates. Financial assets and liabilities denominated in other than the functional currency are remeasured at the balance sheet date exchange rate. The resulting exchange rate differences are recorded in the consolidated statements of operations and comprehensive loss as a foreign exchange related gain or loss.

Assets and liabilities of Terns Suzhou and Terns China are translated into U.S. dollars at the balance sheet date exchange rates, while income and expense items are translated at the average exchange rates prevailing during the fiscal year. Translation adjustments arising from these are reported as foreign currency translation adjustments and are shown as accumulated other comprehensive income (loss) on the consolidated balance sheets.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash, cash equivalents and marketable securities. The Company invests its excess cash with large financial institutions that management believes to be of high credit quality. The Company has not experienced any losses on such deposits.

Patent Costs

All patent-related costs incurred in connection with filing and prosecuting patent applications are expensed as incurred due to the uncertainty of the recovery of the expenditure. Amounts incurred are classified as general and administrative expenses in the consolidated statements of operations and comprehensive loss.

Recently Issued Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (ASU 2016-02), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less may be accounted for similar to existing guidance for operating leases today. For non-public entities, ASU 2016-02 is effective for annual reporting periods, and interim periods within those fiscal years, beginning after December 15, 2021, and early adoption is permitted. Under the JOBS Act, emerging growth companies have extended transition periods available for complying with new or revised accounting standards.

The Company will adopt the new standard on January 1, 2022 using the effective date as the date of initial application. Consequently, prior period amounts will not be adjusted and continue to be reported in accordance with historical accounting policies under ASC 840: Leases (Topic 840). The Company will elect the package of practical expedients under which the Company will not reassess prior conclusions about lease identification, lease classification and initial direct costs. Additionally, the Company will make a policy election that does not recognize right-of-use assets and lease liabilities related to short-term leases. The pattern of recognition for operating leases within the consolidated statements of comprehensive loss is not anticipated to significantly change. Upon adoption, the Company expects to recognize additional operating liabilities of approximately $1.7 million, with corresponding ROU assets of approximately $1.5 million based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The Company’s current operating lease portfolio is primarily comprised of property leases.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. For non-public entities, ASU 2016-13 is effective for annual reporting periods, and interim periods within those fiscal years, beginning after December 15, 2022. Under the JOBS Act, emerging growth companies have extended transition periods available for complying with new or revised accounting standards. The Company has elected to use this exemption to delay adopting ASU 2016-13. The Company is currently in the process of evaluating the impact of the adoption of ASU 2016-13 on its consolidated financial statements.

Fair Value Measurements

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three levels of inputs that may be used to measure fair value are defined below:

•

Level 1—Quoted prices in active markets for identical assets or liabilities at the measurement date.

•

Level 2—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•

Level 3—Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The carrying values of the Company’s other assets, accounts payable and accrued expenses and other current liabilities approximate their fair values due to the short-term nature of these assets and liabilities.

The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis:


	As of December 31, 2021:
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Cash in bank balances	$	14,460	$	—	$	—	$	14,460
Money market funds		33,239		—		—		33,239
Total cash and equivalents	$	47,699	$	—	$	—	$	47,699
Marketable Securities
U.S. government securities	$	—	$	36,192	$	—	$	36,192
Non-U.S. government securities		—		11,182		—		11,182
Corporate debt securities		—		39,443		—		39,443
Commercial paper		—		31,466		—		31,466
Total marketable securities	$	—	$	118,283	$	—	$	118,283


	As of December 31, 2020:
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash and cash equivalents	$	74,854	$	—	$	—	$	74,854
Total	$	74,854	$	—	$	—	$	74,854
Liabilities:
Loans Payable	$	—	$	—	$	12,880	$	12,880
Total	$	—	$	—	$	12,880	$	12,880

The aggregate fair value of marketable securities as of December 31, 2021, by contractual maturity, are as follows:


(in thousands)	Fair Value
Due in one year or less	$	74,531
Due after one year through two years		43,752
Total marketable securities	$	118,283

During the years ended December 31, 2021 and 2020, there were no transfers between Level 1, Level 2 and Level 3.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Loans Payable

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Loans Payable

The following table provides the loans payable reported at fair value and measured on a recurring basis:


(in thousands)	Loans Payable
Balance at December 31, 2019	$	—
Issuance of 2020 Notes and Bridge Loan		16,800
Issuance of repurchase payable for the LAV Option exercise		10,771
Issuance of loans payable for conversion settlement of the Bridge Loan		2,109
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock		(17,690	)
Conversion of Bridge Loan to Series C convertible preferred stock		(2,163	)
Change in fair value of loans payable and other adjustments		3,053
Balance at December 31, 2020	$	12,880

As of December 31, 2021, there was no loans payable balance.

2020 Notes

In May 2020, the Company issued convertible promissory notes (2020 Notes) in the aggregate amount of $15.0 million. The 2020 Notes had an interest rate of 10.0% per annum, were unsecured, and were due and payable, including accrued interest, in May 2021. In connection with the Series C Convertible Preferred Stock Financing, the 2020 Notes, totaling unpaid principal and accrued interest of $15.9 million, converted into 1,366,820 shares of Series C convertible preferred stock.

Bridge Loan

In May 2020, the Company entered into a bridge loan with Terns China (Bridge Loan) for aggregate proceeds of $1.8 million, payable in renminbi (RMB) at an established USD/RMB exchange rate, based on an average of the previous five working days before May 8, 2020. The Bridge Loan had an interest rate of 10% per year, which began to accrue on the date of drawdown, and was computed based on the actual number of days elapsed based on a year of 365 days. The Bridge Loan holders have the same conversion rights as the 2020 Notes holders.

In connection with the closing of the Series C convertible preferred stock financing in December 2020, entities that are a part of LAV agreed to effectively convert the Bridge Loan into shares of Series C preferred stock on the same terms as the 2020 Notes. The conversion will be based on an outstanding loan balance equal to $1.9 million, consisting of (i) the principal loan amount ($1.8 million) plus (ii) accrued interest through December 29, 2020 ($0.1 million).

To help facilitate the transfer of cash from China to the United States to effectively convert the Bridge Loan, the Company and Terns China agreed to enter into an agreement with LAV to (i) repay the Bridge Loan, and (ii) issue shares of Series C convertible preferred stock at the initial closing of the Series C financing to entities that are a part of LAV in exchange for a promissory note issued to the Company by LAV, or the LAV Affiliate Promissory Note.

The Bridge Loan was repaid in full by the Company following the requisite government approvals in China. Proceeds from the repayment of the Bridge Loan by Terns China were used by LAV to repay the LAV Affiliate Promissory Note in full. The fair value of the Bridge Loan was determined to be $2.1 million as of December 31, 2020. The Bridge Loan and the LAV Affiliate Promissory Note were paid in full in March 2021.

LAV Series A and Series B Promissory Notes

In November 2020, the Chinese government provided approval for entities affiliated with LAV to exercise the LAV Option (see Note 4, Convertible Preferred Stock). Terns Hong Kong agreed to repurchase all equity interests held by the LAV PRC Entities with proceeds to be used by LAV to purchase shares of Series A convertible preferred stock and Series B convertible preferred stock of the Company (Repurchase).

In December 2020, the Company issued 767,857 shares of Series A convertible preferred stock and 216,450 shares of Series B convertible preferred stock to an affiliate of LAV (LAV Affiliate) in exchange for a promissory note with a principal amount equal to the original investment by LAV in Terns China (LAV Series A and Series B Promissory Note). The LAV Series A and Series B Promissory Note was repaid through proceeds of the Repurchase which was completed in January 2021.

Prior to their repayment, the carrying value of the LAV Series A and Series B Promissory Notes approximated their respective fair value due to the short-term nature of the liability.

Change in Fair Value of Loans Payable

The fair value of the loans payable liability was determined based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The fair value of the loans payable liability is remeasured at each reporting period, with changes in fair value recognized in the consolidated statements of operations.

During 2020, the Company used the PWERM method to value the loans payable. This approach involved the estimation of future potential outcomes for the Company, as well as values and probabilities associated with each respective potential outcome. The Company considered two scenarios (i) a 60% probability of an IPO in the near-term and (ii) a 40% probability of the Company remaining private for 1.75 years following the date of the valuation. The Company considered these two scenarios to calculate the (i) future value of the loans payable under each scenario and (ii) the present value of the loans payable under each scenario. The value of the Company’s equity used to determine the appropriate allocation of value to the stockholders was calculated using different methodologies for each scenario. For the first scenario, the value of the Company’s equity was estimated based on the Company’s estimates, as well as recent IPOs of comparable companies. For the second scenario, the value of the Company’s equity was estimated using the income approach, which focuses on the income-producing capability of a business and estimates value based on the expectation of future cash flows, which are then discounted to the present using a rate of return that incorporates the risk-free rate for the use of funds, the expected rate of inflation, and risks associated with the particular investment. Under each scenario, the rights and preferences of each share class were considered in order to determine the appropriate allocation of value to the common and preferred stockholders, as well as the loans payable. The value per share of common and preferred stock, as well as the loans payable, under each scenario was multiplied by a present value factor, calculated based on the Company’s cost of equity and the expected timing of each scenario. After taking into consideration the PWERM of each scenario, the Company arrived at the fair value of the loans payable.

The Company recorded other expense of $2.9 million related to the change in the fair value of loans payable for the year ended December 31, 2020.

The outstanding LAV Series A and Series B Promissory Note was settled in January 2021 and was paid with the proceeds received from the note receivable of $10.8 million. The outstanding Bridge Loan was settled in March 2021 and was substantially paid with the proceeds received from the LAV Affiliate Promissory Note receivable of $1.9 million.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Convertible Preferred Stock

12 Months Ended

Dec. 31, 2021

Convertible Preferred Stock [Abstract]

Convertible Preferred Stock

All shares of preferred stock described below were converted into 16,079,230 shares of the Company’s common stock at the time of the IPO in February 2021.

Series A Preferred Stock

In April 2017, the Company entered into a Series A convertible preferred stock purchase agreement (Series A Agreement) whereby the Company issued 2,089,285 shares of Series A convertible preferred stock at $10.50 per share for an aggregate purchase price of $21.9 million.

Terns China received an aggregate $8.0 million from the LAV PRC Entities in connection with the Series A financing, which is presented as a noncontrolling interest. In connection with the Series A Agreement and this Terns China investment, the Company also issued an option to the LAV PRC Entities to convert their interest in the China Subsidiaries into an interest in Terns Cayman (the LAV Option).

Series B Preferred Stock

In October 2018, the Company entered into a Series B convertible preferred share purchase agreement (Series B Agreement), whereby the Company issued an aggregate of 2,384,195 shares of Series B convertible preferred stock at $30.80 per share for an aggregate purchase price of $73.4 million.

Terns China received $6.7 million from the LAV PRC Entities in connection with the Series B financing, which is presented as a noncontrolling interest. In connection with the Series B Agreement and this Terns China investment, the LAV Option was to allow the LAV PRC Entities to convert this interest in the China Subsidiaries into an interest in Terns Cayman.

LAV Series A and Series B Preferred Stock Options

In November 2020, the Chinese government provided approval for entities affiliated with Lilly Asia Ventures (LAV) to exercise the LAV Option. Terns Hong Kong agreed to repurchase all equity interests held by the LAV PRC Entities with proceeds to be used by LAV to purchase shares of Series A convertible preferred stock and Series B convertible preferred stock of the Company (Repurchase).

Series C Preferred Stock

In December 2020, the Company entered into a Series C preferred stock purchase agreement (Series C Convertible Preferred Stock Financing) whereby it issued an aggregate of 7,500,665 shares of Series C convertible preferred stock at $11.65 per share for gross proceeds of $87.4 million, which includes shares issued upon conversion of the 2020 Notes.

In connection with the Series C Convertible Preferred Stock Financing, the 2020 Notes, totaling unpaid principal and accrued interest of $15.9 million, converted into 1,366,820 shares of Series C convertible preferred stock. Furthermore, in December 2020, as part of the effective conversion of the Bridge Loan, the Company issued LAV an aggregate of 167,159 shares of Series C convertible preferred stock.

In connection with the Series C Convertible Preferred Stock Financing, a down-round adjustment was triggered for Series B convertible preferred stock. Instead of adjusting the conversion price of the Series B convertible preferred stock to $25.63, the Company and its investors agreed to adjust it to $30.80. This resulted in an extinguishment of all outstanding shares of Series B convertible preferred stock that were recorded at their fair value of $79.7 million. Immediately following the extinguishment, the shares of Series B convertible preferred stock were reissued and recorded at their fair value of $69.0 million. As part of the extinguishment, the Company recorded an increase to additional paid-in capital of $10.7 million, representing the difference between the extinguished carrying value of Series B convertible preferred stock and the fair value of the net consideration transferred to stockholders. The $10.7 million is also treated as an increase to earnings attributable to common stockholders in the calculation of net income (loss) per share.

Series A convertible preferred stock, Series B convertible preferred stock and Series C convertible preferred stock are collectively referred to as “convertible preferred stock.” As of December 31, 2020, convertible preferred stock consisted of the following:


	As of December 31, 2020
(in thousands, except share amounts)	Convertible Preferred Stock Authorized		Convertible Preferred Stock Issued and Outstanding		Carrying Value		Liquidation Preference		Common Stock Issuable Upon Conversion
Series A convertible preferred stock		40,000,000		2,857,142	$	30,000	$	30,000		2,857,142
Series B convertible preferred stock		36,409,088		2,600,645		68,995		80,100		5,721,423
Series C convertible preferred stock		111,619,996		7,500,665		87,038		87,368		7,500,665
Total convertible preferred stock		188,029,084		12,958,452	$	186,033	$	197,468		16,079,230

In connection with the IPO, all the outstanding shares of convertible preferred stock converted into common stock and the Company does not have any shares of preferred stock outstanding as of December 31, 2021.

Common Stock and Stock-Based Compensation

12 Months Ended

Dec. 31, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Common Stock and Stock-Based Compensation

As of each balance sheet date, the Company had reserved shares of common stock for issuance in connection with the following:


	December 31,
	2021		2020
Conversion of outstanding shares of convertible preferred stock		—		16,079,230
Options outstanding under incentive award plans		3,577,485		2,466,670
Shares available for future grant under incentive award plans		1,138,622		17,556
Shares available for future grant under employee stock purchase plans		240,000		—
Total shares reserved		4,956,107		18,563,456

Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, if any, as may be declared by the Company’s board of directors, subject to the preferential dividend rights of the convertible preferred stock. Through December 31, 2021, no cash dividends have been declared or paid by the Company.

The Company has two stock-based compensation plans, the 2017 Incentive Award Plan (the “2017 Plan”) and the 2021 Incentive Award Plan (the “2021 Plan”) which was adopted in February 2021. Although awards made under the 2017 Plan continue to be governed by its terms, the 2017 Plan was terminated at the time of our IPO and no further awards are made under this plan. The 2021 Plan, while effective, authorizes the granting of equity awards to employees and directors of the Company, as well as non-employee consultants. Stock options granted to employees and nonemployees under the plans generally vest over four years and allow the holder of the option to purchase common stock at a stated exercise price. Options granted under the plans generally expire ten years after the date of grant. The Company recognizes the stock-based compensation expense over the requisite service period of the individual grantees, which generally equals the vesting period.

2021 Incentive Award Plan

In January 2021, the Company's board of directors approved the 2021 Plan which permits the granting of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance bonus awards, performance stock unit awards and other stock awards to employees, directors, officers and consultants. In February 2021, 2,400,007 shares were authorized for issuance under the 2021 Plan, which shall be cumulatively increased on the first day of each year beginning in 2022 and ending in 2031 equal to the lesser of (i) the amount equal to 5% of the number of shares issued and outstanding on the last day of the immediately preceding fiscal year or (ii) such lower number of shares as may be determined by the Company’s board of directors. The 2021 Plan is the successor to the 2017 Incentive Award Plan and no additional awards may be issued from the 2017 Plan. However, the 2017 Plan will continue to govern the terms and conditions of the outstanding awards granted under this plan. Shares of common stock subject to awards granted under the 2017 Plan that are forfeited or lapse unexercised and which following the effective date of the 2021 Plan are not issued under the 2017 Plan will be available for issuance under the 2021 Plan. As of December 31, 2021, 1,138,622 shares of the Company’s common stock were available for future grants under the 2021 Plan. The number of authorized shares reserved for issuance under the 2021 Plan was increased by 1,263,463 shares effective as of January 1, 2022.

2021 Employee Stock Purchase Plan

The 2021 Employee Stock Purchase Plan (the “2021 ESPP”) was approved by the Company’s board of directors in January 2021. In February 2021, a total of 240,000 shares were initially reserved for issuance under this plan, which shall be cumulatively increased on the first day of each year beginning in 2022 and ending in 2031 equal to the lesser of (i) 1% of the shares outstanding (on an as converted basis) on the last day of the immediately preceding fiscal year and (ii) such number of shares as may be determined by the Company’s board of directors. As of December 31, 2021, 240,000 shares of the Company’s common stock were available for future grants under the 2021 ESPP. The number of authorized shares reserved for issuance under the 2021 ESPP was increased by 252,692 shares effective as of January 1, 2022.

Under the ESPP, eligible employees may select a rate of payroll deduction up to 15% of their eligible compensation subject to certain maximum purchase limitations. The duration for each offering period is 12 months and is divided into two purchase periods of approximately six months in length. Offerings are concurrent. The purchase price of the shares under the offering is the lesser of 85% of the fair market value of the shares on the offering date or 85% of the fair market value of the shares on the purchase date. A one-year look-back feature in the ESPP causes the offering period to automatically reset if the fair value of the Company’s common stock on the last day of the purchase period is less than that on the original offering date. ESPP purchases by employees are settled with newly-issued common stock from the ESPP’s previously authorized and available pool of shares.

As of December 31, 2021, there was $0.1 million of unrecognized stock-based compensation expense related to unvested employee stock purchases. The unrecognized stock-based compensation expense is estimated to be recognized over a period of 0.92 years as of December 31, 2021. There were no shares purchased by employees under the ESPP during the year ended December 31, 2021.

Stock Options

The following table summarizes the stock option activity for all stock plans during the years ended December 31, 2021 and 2020:


	Number of Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
						(in years)		(in thousands)
Outstanding as of December 31, 2019		478,135		$	4.48		8.94	$	2,277
Granted		2,137,169			8.57
Exercised		(38,285	)		3.09				167
Forfeited		(110,349	)		2.93
Outstanding as of December 31, 2020		2,466,670		$	8.03		9.61	$	21,678
Granted		1,429,850			11.83
Exercised		(156,104	)		5.86				858
Forfeited		(162,931	)		8.28
Outstanding as of December 31, 2021		3,577,485		$	9.72		9.09	$	491
Exercisable, December 31, 2021		1,937,772		$	8.35		8.71	$	453
Vested and expected to vest, December 31, 2021		3,577,485		$	9.72		9.09	$	491

The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the Company’s common stock.

As of December 31, 2021 and 2020, respectively, there was $28.6 million and $26.7 million of unrecognized stock-based compensation expense related to unvested stock options. The unrecognized stock-based compensation expense is estimated to be recognized over a period of 2.99 years as of December 31, 2021.

The total fair value of options vested during the year ended December 31, 2021 and 2020 was $7.8 million and $0.7 million, respectively.

Restricted Stock

The following table summarizes the stock award activity for all stock plans during the years ended December 31, 2021 and 2020:


	Number of Shares			Grant-Date Fair Value
Unvested restricted common stock as of December 31, 2019		166,667		$	1.96
Vested		(83,333	)		1.96
Unvested restricted common stock as of December 31, 2020		83,334			1.96
Vested		(71,429	)		1.96
Forfeited		(11,905	)		1.96
Unvested restricted common stock as of December 31, 2021		—		$	—

As of December 31, 2021, there was no unrecognized stock-based compensation expense related to restricted stock granted by the Company. As of December 31, 2020, there was less than $0.1 million of unrecognized stock-based compensation expense related to restricted stock granted by the Company.

The total fair value of the restricted stock vested during the years ended December 31, 2021 and 2020 was $0.1 million and $0.2 million, respectively.

Stock-Based Compensation Expense

The Company estimated the fair value of options granted and rights to acquire stock granted under the Company’s employee stock purchase plan using a Black-Scholes option pricing model with the following assumptions presented on a weighted average basis:


	Year Ended December 31,
	2021			2020
Stock Option Plans
Expected term (years)		6.03		6.06
Expected volatility		76.60	%		62.02	%
Risk-free interest rate		1.12	%		0.49	%
Fair value of underlying common stock	$	11.83		$	17.97
Weighted average grant-date fair value per share	$	7.82		$	12.84
Employee Stock Purchase Plans
Expected term (years)		0.75			—
Expected volatility		60.82	%		—	%
Risk-free interest rate		0.17	%		—	%
Fair value of underlying common stock	$	6.53		$	—
Weighted average grant-date fair value per share	$	2.33		$	—

Stock-based compensation expense was classified in the consolidated statements of operations and comprehensive loss as follows:


	Year Ended December 31,
(in thousands)	2021		2020
Research and development expense	$	2,055	$	373
General and administrative expense		6,091		1,318
Total stock-based compensation expense	$	8,146	$	1,691

Income Tax

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Tax

The following table presents domestic and foreign components of (loss) income before income taxes:


	Year Ended December 31,
(in thousands)	2021			2020
U.S.	$	(49,733	)	$	1,180
Foreign		83			(40,938	)
Total loss before income tax	$	(49,650	)	$	(39,758	)

The following table presents the provision for income taxes:


	Year Ended December 31,
(in thousands)	2021		2020
Current
Federal	$	105	$	128
State		1		1
Foreign		313		279
Total current	$	419	$	408
Deferred
Federal	$	—	$	449
Foreign		89		(44	)
Total deferred	$	89	$	405
Total income tax expense	$	508	$	813

The reconciliation of the U.S. federal statutory income tax benefit to the Company’s effective income tax rate is as follows:


	Year Ended December 31,
	2021			2020
Tax benefit at U.S. statutory rate		21.00	%		21.00	%
Foreign income taxed at non-U.S. rates		(0.37	)		(22.10	)
Domestication		32.57			—
Other permanent items		(0.07	)		(0.16	)
Stock-based compensation		(0.52	)		(0.16	)
Research and development credits		2.14			2.28
Unrecognized tax benefit		(1.18	)		(0.71	)
Global intangible low-taxed income		—			(0.32	)
Increase in valuation allowance		(54.53	)		(2.01	)
Other		(0.05	)		0.14
		(1.02	)%		(2.04	)%

The difference between the provision for income taxes and the income tax determined by applying the statutory federal income tax rate of 21% was primarily due to the Domestication and the change in valuation allowance.

Significant components of the Company’s deferred tax assets and liabilities are as follows:


	As of December 31,
(in thousands)	2021			2020
Deferred tax assets:
Accruals and reserves	$	575		$	619
Intangibles		14,574			—
Stock-based compensation		1,582			340
Net operating loss		10,271			28
Research and development credits		1,930			683
Other		87			—
Valuation allowance		(28,849	)		(1,431	)
Total deferred tax assets	$	170		$	239
Deferred tax liabilities:
Fixed assets	$	(78	)	$	(58	)
Total deferred tax liabilities	$	(78	)	$	(58	)
Net deferred tax assets	$	92		$	181

As of December 31, 2021, the Company recorded a full valuation allowance against its U.S. net deferred tax assets as it believes these deferred tax assets were not realizable on a more likely than not basis. This is based upon the weight of available evidence, including historical operating performance, the change of structure due to the Domestication, and that a net loss will be expected to occur in the foreseeable future.

As of December 31, 2021, the Company had federal, state, and foreign net operating loss carryforwards of approximately $48.7 million, $0.4 million, and $0.2 million, respectively. The federal net operating loss has an indefinite carryforward, while the state and foreign net operating losses will begin to expire in 2041 and 2023, respectively. As of December 31, 2020, the Company did not have any federal, state, or foreign net operating loss carryforwards.

As of December 31, 2021 and 2020, the Company had federal Research and Experimentation (R&E) credit carryforwards of approximately $1.9 million and $0.8 million, respectively, which will begin to expire in 2040. The California R&E credit carryforwards of approximately $1.7 million and $1.2 million, respectively, do not expire.

Utilization of net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. The Company does not expect any previous ownership changes, as defined under Section 382 and 383 of the Internal Revenue Code, to result in a limitation that will materially reduce the total amount of net operating loss carryforwards and credits that can be utilized. Further, foreign loss carryforwards maybe subject to limitations under the applicable laws of the taxing jurisdictions due to ownership change limitations.

As of December 31, 2021, the Company has provided U.S. income taxes on all its foreign earnings. The Company continues to permanently reinvest the cash held offshore to support its working capital needs. Accordingly, no additional foreign withholding taxes that may be required from certain jurisdictions in the event of a cash distribution have been provided for.

As of December 31, 2021 and 2020, the total amount of unrecognized tax benefits was $5.8 million and $5.4 million, respectively, $4.5 million and $4.2 million of which would affect income tax expense, if recognized, before consideration of any valuation allowance. The Company does not expect the unrecognized tax benefits to change significantly over the next 12 months.

A reconciliation of the beginning and ending unrecognized tax benefit are as follows:


	Year Ended December 31,
(in thousands)	2021			2020
Unrecognized tax benefit at beginning of year	$	5,406		$	4,709
Increases related to prior year tax positions		365			—
Increases related to current year tax position		451			697
Decreases related to prior year tax positions		(373	)		—
Unrecognized tax benefit at end of year	$	5,849		$	5,406

The Company includes interest and penalties related to unrecognized tax benefits within the provision for income taxes. As of December 31, 2021, the total amount of gross interest and penalties accrued was $0.1 million. As of December 31, 2020, the total amount of gross interest and penalties accrued was nominal.

The Company is subject to income taxes in the U.S. federal, state, and various foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. The Company’s tax years remain open for examination by all tax authorities since inception as well as carryover attributes beginning December 31, 2018, remain open to adjustment by U.S. and foreign authorities.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-Section 50
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-Subparagraph (b)
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section 50
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Net Loss Per Share of Common Stock

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Net Loss Per Share of Common Stock

Basic and diluted net loss per share of common stock were calculated as follows:


	Year Ended December 31,
(in thousands, except share and per share amounts)	2021			2020
Numerator:
Net loss	$	(50,158	)	$	(40,571	)
Extinguishment of Series B convertible preferred stock		—			10,701
Net loss attributable to noncontrolling interest		—			(518	)
Net loss attributable to common stockholders	$	(50,158	)	$	(29,352	)
Denominator:
Weighted average common stock outstanding, basic and diluted		22,705,948			285,162
Net loss per share attributable to common stockholders, basic and diluted	$	(2.21	)	$	(102.93	)

The Company excluded the following potential shares of common stock, presented based on amounts outstanding at each period end, from the computation of diluted net loss attributable to common stockholders per share of common stock for the periods indicated because including them would have had an anti-dilutive effect:


	December 31,
	2021		2020
Options to purchase common stock		3,577,485		2,466,670
Restricted common stock		—		83,334
Convertible preferred stock (as converted to common stock)		—		16,079,230
Shares issuable under employee stock purchase plan		6,717		—
Total		3,584,202		18,629,234

Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Lease Agreements

In March 2019, the Company entered into a lease agreement for office space in Foster City, California which expires October 2024. The Company has the option to extend the lease agreement for a period of five years. The monthly lease payments include base rent charges of $48,000. The lease provides for a rent abatement and scheduled increases in base rent.

In June 2019, the Company entered into a lease agreement for office space in Suzhou China, which expires in October 2022. Monthly lease payments are inclusive of base rent, property management fee and the respective value added tax to be paid. Monthly lease payments include base rent of approximately $4,000 through October 2022.

Future minimum lease payments due under operating leases as of December 31, 2021 are as follows:


(in thousands)	Operating Leases
2022	$	669
2023		652
2024		559
2025 and thereafter		—
Total	$	1,880

Contingencies

From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. The Company accrues a liability for such matters when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. For all periods presented, the Company was not a party to any pending material litigation or other material legal proceedings.

Assignment, License and Collaboration Agreements

12 Months Ended

Dec. 31, 2021

Assignment License And Collaboration Agreements [Abstract]

Assignment, License and Collaboration Agreements

License Agreements

TERN-101 License Agreement with Eli Lilly

In February 2018, the Company entered a worldwide exclusive license agreement with Eli Lilly and Company (Lilly) (Lilly FXR 2018 License Agreement). Under the terms of the Lilly FXR 2018 License Agreement, Lilly granted the Company an exclusive, royalty-bearing license to make, have made, use, offer for sale, sell, import, and have imported, including all rights to develop, manufacture, and commercialize covered products in the field in the territory and a sublicensing right that allows the Company to grant sublicenses to affiliates and third parties to perform any portion of the development, manufacture, and commercialization of covered products. The Company is required to use commercially reasonable efforts to meet development event milestones, develop the covered product in the field in mainland China and commercialize the covered product in the field in mainland China.

The Company agreed to pay Lilly up to an aggregate of $6.0 million in pre-specified development milestones for the first covered product in mainland China, and up to an aggregate of $50.0 million in pre-specified development milestones for the first covered product in ex-mainland China. The Company also agreed to pay Lilly tiered royalties calculated on a calendar year basis, in the mid-single digits to low teens on net sales ranging from the low hundreds of millions of dollars to the low billions of dollars. The Lilly FXR 2018 License Agreement expires upon expiry of the last remaining royalty obligation for a licensed product. As of December 31, 2021, the Company has not paid any amounts under the agreement and no milestones have been achieved. The Company has not recorded any research and development expense during the years ended December 31, 2021 and 2020 related to this agreement.

TERN-201 License Agreement with Eli Lilly

In March 2018, the Company entered into an exclusive license agreement with Lilly (Lilly VAP-1 2018 License Agreement). Under the terms of the Lilly VAP-1 2018 License Agreement, Lilly granted the Company an exclusive, royalty-bearing license to make, have made, use, offer for sale, sell, import, and have imported, including all rights to develop, manufacture, and commercialize covered products and a sublicensing right that allows the Company to grant sublicenses to affiliates and third parties to perform any portion of the development, manufacture, and commercialization of covered products. The Company will remain directly responsible for all amounts owed to Lilly, regardless of sublicenses. The Company is required to use commercially reasonable efforts to meet development events according to achievement due dates and commercialize the covered product in the field in the major markets.

The Company paid Lilly a non-refundable, non-creditable upfront payment of $4.0 million, which was recorded as research and development expense in the Company’s statement of operations and comprehensive loss for the year ended December 31, 2018. In addition, pursuant to the terms of the Lilly VAP-1 2018 License Agreement, the Company agreed to pay Lilly up to an aggregate of $74.0 million in pre-specified development milestones for the first covered product, and up to an aggregate of $30.0 million in pre-specified development milestones for the second indication of a covered product. The Company must also pay Lilly tiered royalties calculated on a calendar year basis, in the mid-single digits to mid-teens on net sales ranging from the high tens of millions of dollars to the low billions of dollars. The Lilly VAP-1 2018 License Agreement expires upon expiry of the last remaining royalty obligation for a licensed product. As of December 31, 2021, the Company has paid $4.0 million to Lilly. No development milestones have been met as of December 31, 2021. The Company has not recorded any research and development expense during the years ended December 31, 2021 and 2020 related to this agreement.

Assignment Agreement

In June 2019, the Company entered into an assignment agreement with Vintagence Biotechnology Ltd. (Vintagence) (Vintagence 2019 Assignment Agreement). Under the terms of the Vintagence 2019 Assignment Agreement, Vintagence assigned and agreed to assign to the Company any and all worldwide rights, title, and interest in and to the Vintagence technology and gave Terns a sublicensing right that allows the Company to grant sublicenses to any of its affiliates and/or to licensees or contractors to perform any portion of the development, manufacture, and/or commercialization of covered compounds or covered products. The Company will remain directly responsible for all amounts owed to Vintagence under this agreement, regardless of sublicenses. The Company is required to use commercially reasonable efforts to commercialize the covered product in the field in the major markets.

The Company paid Vintagence a non-refundable, non-creditable upfront payment of $0.7 million, which was recorded as research and development expense in the Company’s statements of operations and comprehensive loss for the year ended December 31, 2019. In addition, pursuant to the terms of the Vintagence 2019 Assignment Agreement, the Company agreed to pay Vintagence up to CNY 205.0 million in development milestones for the first covered product. The term of the Vintagence 2019 Assignment Agreement will continue in effect on a country-by-country basis until all milestone payments are made. The Company has the right to terminate the agreement in its entirety or on a covered product-by-covered product and country-by-country basis, in its sole discretion by giving 60 days advance written notice to Vintagence. As of December 31, 2021, the Company has paid $2.2 million to Vintagence which includes a milestone payment of $1.5 million in connection with the Company's IND filing for TERN-501 in December 2020. The Company has not recognized any research and development expenses during the year ended December 31, 2021 related to this agreement. The Company has recognized research and development expense of approximately $1.5 million during the year ended December 31, 2020 related to this agreement.

Hansoh Option and License Agreement

In July 2020, the Company entered into an exclusive option and license agreement with Hansoh (Shanghai) Healthtech Co., Ltd. (Hansoh Healthtech) and Jiangsu Hansoh Pharmaceutical Group Company Ltd. (Jiangsu Hansoh) (collectively, Hansoh) (Hansoh 2020 Option and License Agreement). Under the terms of the Hansoh 2020 Option and License Agreement, the Company granted Hansoh an exclusive, non-transferable, non-sublicensable, fully-paid, royalty-free license to conduct preliminary studies on the licensed compound with an option to exclusively license the same for development and commercialization of licensed products in all prophylactic, palliative, therapeutic and/or diagnostic uses in connection with all human diseases and disorders (including development and research activities on animal models thereof) in the field of oncology, including all types of cancers (Field) in mainland China, Taiwan, Hong Kong and Macau (collectively, the Territory). In November 2021, Hansoh exercised its option and was granted an exclusive, royalty-bearing license, with the right to sublicense to exploit licensed compound and licensed products in the Field and in the Territory.

Under the Hansoh 2020 Option and License Agreement, Hansoh was required to pay the Company a refundable, non-creditable upfront payment. The Company received an upfront payment of $0.8 million during the year ended December 31, 2020, which was recognized as a refund liability and presented within accrued expenses and other current liabilities on the consolidated balance sheets as of December 31, 2020. In connection with Hansoh’s exercise of its option in November 2021, the Company recognized $1.0 million in license fee revenue within the consolidated statements of operations and comprehensive loss during the year ended December 31, 2021.

In addition, pursuant to the Hansoh 2020 Option and License Agreement, Hansoh has agreed to pay the Company up to $67.0 million in pre-specified clinical, regulatory and sales milestones. Hansoh must also pay the Company royalties in the mid-single digits based on net sales of all licensed products. The term of the Hansoh 2020 Option and License Agreement will continue until the end of the last-to-expire royalty term. As of December 31, 2021, no milestones have been met and future payments are all constrained.

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Basis of Presentation

Initial Public Offering

Certificate of Incorporation

Reverse Stock Split

Variable Interest Entity

Impact of the COVID-19 Pandemic

Revenue Recognition

Licenses of intellectual property

Milestone payments

Commercial milestones and royalties

Use of Estimates

Cash, Cash Equivalents and Marketable Securities

The fair value and amortized cost of marketable securities by major security type as of December 31, 2021 is as follows:


	December 31, 2021
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	$	33,239	$	—	$	—		$	33,239
U.S. government securities		36,322		—		(130	)		36,192
Non-U.S. government securities		11,194		—		(12	)		11,182
Corporate debt securities		39,495		—		(52	)		39,443
Commercial paper		31,466		—		—			31,466
Total	$	151,716	$	—	$	(194	)	$	151,522

Classified as:
Cash equivalents								$	33,239
Marketable securities									118,283
Total								$	151,522

The Company did not have any marketable securities for the year ended December 31, 2020.

Classification of Convertible Preferred Stock and Presentation of Noncontrolling Interest

Research and Development Expenses

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities included the following:


	December 31,
(in thousands)	2021		2020
Research and development costs	$	1,570	$	2,800
Accrued professional fees		363		2,185
Compensation and benefit costs		2,403		1,492
Accrued development milestone		—		1,531
Refundable contract liability		—		836
Other		358		162
Total accrued expenses and other current liabilities	$	4,694	$	9,006

Income Taxes

Common Stock Valuation

•

the progress of the Company’s research and development programs, including the status and results of clinical and nonclinical studies for its drugs;

•

the Company’s stage of development and commercialization and its business strategy;

•

external market conditions affecting the biotechnology industry and trends within the biotechnology industry;

•

the Company’s financial position, including cash on hand, and its historical and forecasted performance and operating results;

•

the lack of an active public market for the Company’s common stock and convertible preferred stock;

•

the likelihood of achieving a liquidity event, such as an IPO or sale of the Company in light of prevailing market conditions; and

•

the analysis of IPOs and the market performance of similar companies in the biotechnology industry.

Significant changes to the key assumptions underlying the factors used could have resulted in different fair values of common stock at each valuation date.

Comprehensive Loss

Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources.

Stock-Based Compensation

Net Loss Per Share of Common Stock

Deferred Offering Costs

Property and Equipment

Property and equipment, net consisted of the following:


		December 31,
(in thousands)	Estimated Useful Lives	2021			2020
Leasehold improvements	Shorter of remaining life of lease or useful life of asset	$	928		$	897
Furniture and fixtures	5 years		281			218
Computer equipment	3 years		202			156
Office equipment	5 years		102			41
Lab equipment	3 to 5 years		718			552
Property and equipment, gross			2,231			1,864
Less: Accumulated depreciation			(1,185	)		(689	)
Total property and equipment, net		$	1,046		$	1,175

The Company recognized depreciation expense related to these assets of $0.5 million and $0.4 million during the years ended December 31, 2021 and 2020, respectively.

Impairment of Long-Lived Assets

Functional Currencies and Foreign Currency Translation

Concentration of Credit Risk

Patent Costs

Recently Issued Accounting Pronouncements Not Yet Adopted

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Schedule of Fair Value And Amortized Cost of Marketable Securities

The fair value and amortized cost of marketable securities by major security type as of December 31, 2021 is as follows:


	December 31, 2021
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	$	33,239	$	—	$	—		$	33,239
U.S. government securities		36,322		—		(130	)		36,192
Non-U.S. government securities		11,194		—		(12	)		11,182
Corporate debt securities		39,495		—		(52	)		39,443
Commercial paper		31,466		—		—			31,466
Total	$	151,716	$	—	$	(194	)	$	151,522

Classified as:
Cash equivalents								$	33,239
Marketable securities									118,283
Total								$	151,522

Schedule of Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities included the following:


	December 31,
(in thousands)	2021		2020
Research and development costs	$	1,570	$	2,800
Accrued professional fees		363		2,185
Compensation and benefit costs		2,403		1,492
Accrued development milestone		—		1,531
Refundable contract liability		—		836
Other		358		162
Total accrued expenses and other current liabilities	$	4,694	$	9,006

Schedule of Property and Equipment

Property and equipment, net consisted of the following:


		December 31,
(in thousands)	Estimated Useful Lives	2021			2020
Leasehold improvements	Shorter of remaining life of lease or useful life of asset	$	928		$	897
Furniture and fixtures	5 years		281			218
Computer equipment	3 years		202			156
Office equipment	5 years		102			41
Lab equipment	3 to 5 years		718			552
Property and equipment, gross			2,231			1,864
Less: Accumulated depreciation			(1,185	)		(689	)
Total property and equipment, net		$	1,046		$	1,175

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis:


	As of December 31, 2021:
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Cash in bank balances	$	14,460	$	—	$	—	$	14,460
Money market funds		33,239		—		—		33,239
Total cash and equivalents	$	47,699	$	—	$	—	$	47,699
Marketable Securities
U.S. government securities	$	—	$	36,192	$	—	$	36,192
Non-U.S. government securities		—		11,182		—		11,182
Corporate debt securities		—		39,443		—		39,443
Commercial paper		—		31,466		—		31,466
Total marketable securities	$	—	$	118,283	$	—	$	118,283


	As of December 31, 2020:
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash and cash equivalents	$	74,854	$	—	$	—	$	74,854
Total	$	74,854	$	—	$	—	$	74,854
Liabilities:
Loans Payable	$	—	$	—	$	12,880	$	12,880
Total	$	—	$	—	$	12,880	$	12,880

Schedule of Aggregate Fair Value of Marketable Securities

The aggregate fair value of marketable securities as of December 31, 2021, by contractual maturity, are as follows:


(in thousands)	Fair Value
Due in one year or less	$	74,531
Due after one year through two years		43,752
Total marketable securities	$	118,283

Loans Payable (Tables)

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Schedule of Loans Payable Reported at Fair Value and Measured on Recurring Basis

The following table provides the loans payable reported at fair value and measured on a recurring basis:


(in thousands)	Loans Payable
Balance at December 31, 2019	$	—
Issuance of 2020 Notes and Bridge Loan		16,800
Issuance of repurchase payable for the LAV Option exercise		10,771
Issuance of loans payable for conversion settlement of the Bridge Loan		2,109
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock		(17,690	)
Conversion of Bridge Loan to Series C convertible preferred stock		(2,163	)
Change in fair value of loans payable and other adjustments		3,053
Balance at December 31, 2020	$	12,880

Convertible Preferred Stock (Tables)

12 Months Ended

Dec. 31, 2021

Convertible Preferred Stock [Abstract]

Schedule of Convertible Preferred Stock


	As of December 31, 2020
(in thousands, except share amounts)	Convertible Preferred Stock Authorized		Convertible Preferred Stock Issued and Outstanding		Carrying Value		Liquidation Preference		Common Stock Issuable Upon Conversion
Series A convertible preferred stock		40,000,000		2,857,142	$	30,000	$	30,000		2,857,142
Series B convertible preferred stock		36,409,088		2,600,645		68,995		80,100		5,721,423
Series C convertible preferred stock		111,619,996		7,500,665		87,038		87,368		7,500,665
Total convertible preferred stock		188,029,084		12,958,452	$	186,033	$	197,468		16,079,230

Common Stock and Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Schedule of Common Stock Shares Reserved for Issuance

As of each balance sheet date, the Company had reserved shares of common stock for issuance in connection with the following:


	December 31,
	2021		2020
Conversion of outstanding shares of convertible preferred stock		—		16,079,230
Options outstanding under incentive award plans		3,577,485		2,466,670
Shares available for future grant under incentive award plans		1,138,622		17,556
Shares available for future grant under employee stock purchase plans		240,000		—
Total shares reserved		4,956,107		18,563,456

Summary of Stock Option Activity

The following table summarizes the stock option activity for all stock plans during the years ended December 31, 2021 and 2020:


	Number of Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
						(in years)		(in thousands)
Outstanding as of December 31, 2019		478,135		$	4.48		8.94	$	2,277
Granted		2,137,169			8.57
Exercised		(38,285	)		3.09				167
Forfeited		(110,349	)		2.93
Outstanding as of December 31, 2020		2,466,670		$	8.03		9.61	$	21,678
Granted		1,429,850			11.83
Exercised		(156,104	)		5.86				858
Forfeited		(162,931	)		8.28
Outstanding as of December 31, 2021		3,577,485		$	9.72		9.09	$	491
Exercisable, December 31, 2021		1,937,772		$	8.35		8.71	$	453
Vested and expected to vest, December 31, 2021		3,577,485		$	9.72		9.09	$	491

Schedule of Stock Options Weighted Average Assumptions


	Year Ended December 31,
	2021			2020
Stock Option Plans
Expected term (years)		6.03		6.06
Expected volatility		76.60	%		62.02	%
Risk-free interest rate		1.12	%		0.49	%
Fair value of underlying common stock	$	11.83		$	17.97
Weighted average grant-date fair value per share	$	7.82		$	12.84
Employee Stock Purchase Plans
Expected term (years)		0.75			—
Expected volatility		60.82	%		—	%
Risk-free interest rate		0.17	%		—	%
Fair value of underlying common stock	$	6.53		$	—
Weighted average grant-date fair value per share	$	2.33		$	—

Summary of Restricted Stock Award Activity

The following table summarizes the stock award activity for all stock plans during the years ended December 31, 2021 and 2020:


	Number of Shares			Grant-Date Fair Value
Unvested restricted common stock as of December 31, 2019		166,667		$	1.96
Vested		(83,333	)		1.96
Unvested restricted common stock as of December 31, 2020		83,334			1.96
Vested		(71,429	)		1.96
Forfeited		(11,905	)		1.96
Unvested restricted common stock as of December 31, 2021		—		$	—

Schedule of Stock-based Compensation Expense

Stock-based compensation expense was classified in the consolidated statements of operations and comprehensive loss as follows:


	Year Ended December 31,
(in thousands)	2021		2020
Research and development expense	$	2,055	$	373
General and administrative expense		6,091		1,318
Total stock-based compensation expense	$	8,146	$	1,691

Income Tax (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Components of (Loss) Income Before Income Taxes

The following table presents domestic and foreign components of (loss) income before income taxes:


	Year Ended December 31,
(in thousands)	2021			2020
U.S.	$	(49,733	)	$	1,180
Foreign		83			(40,938	)
Total loss before income tax	$	(49,650	)	$	(39,758	)

Schedule of Provision for Income Taxes

The following table presents the provision for income taxes:


	Year Ended December 31,
(in thousands)	2021		2020
Current
Federal	$	105	$	128
State		1		1
Foreign		313		279
Total current	$	419	$	408
Deferred
Federal	$	—	$	449
Foreign		89		(44	)
Total deferred	$	89	$	405
Total income tax expense	$	508	$	813

Reconciliation between Effect of Applying Federal Statutory Rate and Effective Income Tax Rate

The reconciliation of the U.S. federal statutory income tax benefit to the Company’s effective income tax rate is as follows:


	Year Ended December 31,
	2021			2020
Tax benefit at U.S. statutory rate		21.00	%		21.00	%
Foreign income taxed at non-U.S. rates		(0.37	)		(22.10	)
Domestication		32.57			—
Other permanent items		(0.07	)		(0.16	)
Stock-based compensation		(0.52	)		(0.16	)
Research and development credits		2.14			2.28
Unrecognized tax benefit		(1.18	)		(0.71	)
Global intangible low-taxed income		—			(0.32	)
Increase in valuation allowance		(54.53	)		(2.01	)
Other		(0.05	)		0.14
		(1.02	)%		(2.04	)%

Components of Deferred Tax Assets and Liabilities

Significant components of the Company’s deferred tax assets and liabilities are as follows:


	As of December 31,
(in thousands)	2021			2020
Deferred tax assets:
Accruals and reserves	$	575		$	619
Intangibles		14,574			—
Stock-based compensation		1,582			340
Net operating loss		10,271			28
Research and development credits		1,930			683
Other		87			—
Valuation allowance		(28,849	)		(1,431	)
Total deferred tax assets	$	170		$	239
Deferred tax liabilities:
Fixed assets	$	(78	)	$	(58	)
Total deferred tax liabilities	$	(78	)	$	(58	)
Net deferred tax assets	$	92		$	181

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending unrecognized tax benefit are as follows:


	Year Ended December 31,
(in thousands)	2021			2020
Unrecognized tax benefit at beginning of year	$	5,406		$	4,709
Increases related to prior year tax positions		365			—
Increases related to current year tax position		451			697
Decreases related to prior year tax positions		(373	)		—
Unrecognized tax benefit at end of year	$	5,849		$	5,406

Net Loss Per Share of Common Stock (Tables)

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Net Loss per Common Share

Basic and diluted net loss per share of common stock were calculated as follows:


	Year Ended December 31,
(in thousands, except share and per share amounts)	2021			2020
Numerator:
Net loss	$	(50,158	)	$	(40,571	)
Extinguishment of Series B convertible preferred stock		—			10,701
Net loss attributable to noncontrolling interest		—			(518	)
Net loss attributable to common stockholders	$	(50,158	)	$	(29,352	)
Denominator:
Weighted average common stock outstanding, basic and diluted		22,705,948			285,162
Net loss per share attributable to common stockholders, basic and diluted	$	(2.21	)	$	(102.93	)

Schedule of Antidilutive Securities Excluded from Computation of Net Loss per Share


	December 31,
	2021		2020
Options to purchase common stock		3,577,485		2,466,670
Restricted common stock		—		83,334
Convertible preferred stock (as converted to common stock)		—		16,079,230
Shares issuable under employee stock purchase plan		6,717		—
Total		3,584,202		18,629,234

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments Due Under Operating Leases

Future minimum lease payments due under operating leases as of December 31, 2021 are as follows:


(in thousands)	Operating Leases
2022	$	669
2023		652
2024		559
2025 and thereafter		—
Total	$	1,880

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Feb. 28, 2021 USD ($) $ / shares shares	Dec. 31, 2021 USD ($) $ / shares shares	Dec. 31, 2020 USD ($) $ / shares shares	Oct. 31, 2018 $ / shares	Apr. 30, 2017 $ / shares
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Convertible preferred stock, shares issued upon conversion			16,079,230
Common stock, authorized	150,000,000	150,000,000	299,700,000
Convertible preferred stock,authorized		10,000,000	188,029,084
Common stock, par value \| $ / shares		$ 0.0001	$ 0.0001
Convertible preferred stock, par value \| $ / shares		$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000
Preferred stock, par or stated value per share \| $ / shares	$ 0.0001
Description of reverse stock split		In January 2021, the Company filed an amended and restated certificate of incorporation to effectuate a reverse split of shares of the Company’s common stock and convertible preferred stock on a 1-for-14 basis (the “Reverse Stock Split”). The par value and the number of authorized shares of the convertible preferred stock and common stock were not adjusted as a result of the Reverse Stock Split. All issued and outstanding common stock, options to purchase common stock and per share amounts contained in the consolidated financial statements have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented.
Reverse stock split, conversion ratio		0.0714
Marketable securities \| $		$ 118,283	$ 0
Recognized depreciation expense \| $		500	$ 400
Impairments of long-lived assets \| $		$ 0
Maximum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Estimated Useful Lives		5 years
Minimum
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Estimated Useful Lives		3 years
ASU 2018-07
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		true
Change in accounting principle, accounting standards update, adoption date		Jan. 01, 2022
ASU 2016-02
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		false
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
Recognize additional operating liabilities \| $		$ 1,700
ROU assets \| $		$ 1,500
ASU 2016-13
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Change in accounting principle, accounting standards update, adopted [true false]		false
Change in accounting principle, accounting standards update, immaterial effect [true false]		true
Series A convertible preferred stock
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Convertible preferred stock, shares issued upon conversion			2,857,142
Convertible preferred stock,authorized			40,000,000
Convertible preferred stock, par value \| $ / shares					$ 10.50
Series B convertible preferred stock
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Convertible preferred stock, shares issued upon conversion			5,721,423
Convertible preferred stock,authorized			36,409,088
Convertible preferred stock, par value \| $ / shares				$ 30.80
Series C convertible preferred stock
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Convertible preferred stock, shares issued upon conversion			7,500,665
Convertible preferred stock,authorized			111,619,996
Convertible preferred stock, par value \| $ / shares			$ 11.65
IPO
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items]
Number of shares issued	8,625,000
Underwriters option to purchase additional shares	1,125,000
Net proceeds from issuance of common stock \| $	$ 133,000
Convertible preferred stock, shares issued upon conversion	16,079,230

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Fair Value And Amortized Cost of Marketable Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	$ 151,716
Unrealized Gains	0
Unrealized Losses	(194)
Fair Value	151,522
Cash equivalents	33,239
Marketable securities	118,283	$ 0
Total	151,522
Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	33,239
Unrealized Gains	0
Unrealized Losses	0
Fair Value	33,239
U.S. government securities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	36,322
Unrealized Gains	0
Unrealized Losses	(130)
Fair Value	36,192
Non-U.S. Government Securities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	11,194
Unrealized Gains	0
Unrealized Losses	(12)
Fair Value	11,182
Corporate Debt Securities
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	39,495
Unrealized Gains	0
Unrealized Losses	(52)
Fair Value	39,443
Commercial Paper
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	31,466
Unrealized Gains	0
Unrealized Losses	0
Fair Value	$ 31,466

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Accounting Policies [Abstract]
Research and development costs	$ 1,570	$ 2,800
Accrued professional fees	363	2,185
Compensation and benefit costs	2,403	1,492
Accrued development milestone	0	1,531
Refundable contract liability	0	836
Other	358	162
Total accrued expenses and other current liabilities	$ 4,694	$ 9,006

Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies - Property and Equipment, Net (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 2,231	$ 1,864
Less : Accumulated depreciation	(1,185)	(689)
Property, Plant and Equipment, Net, Total	$ 1,046	1,175
Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	3 years
Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	5 years
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 928	897
Estimated Useful Lives	Shorter of remaining life of lease or useful life of asset
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 281	218
Estimated Useful Lives	5 years
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 202	156
Estimated Useful Lives	3 years
Office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 102	41
Estimated Useful Lives	5 years
Lab equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 718	$ 552
Lab equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	3 years
Lab equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	5 years

Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Assets:
Marketable securities	$ 118,283	$ 0
Recurring
Assets:
Total cash and cash equivalents	47,699	74,854
Marketable securities	118,283
Total		74,854
Liabilities:
Loans payable		12,880
Total		12,880
Recurring \| Cash in bank balances
Assets:
Total cash and cash equivalents	14,460
Recurring \| Money Market Funds
Assets:
Total cash and cash equivalents	33,239
Recurring \| U.S. government securities
Assets:
Marketable securities	36,192
Recurring \| Non-U.S. Government Securities
Assets:
Marketable securities	11,182
Recurring \| Corporate Debt Securities
Assets:
Marketable securities	39,443
Recurring \| Commercial Paper
Assets:
Marketable securities	31,466
Recurring \| Level 1
Assets:
Total cash and cash equivalents	47,699	74,854
Total		74,854
Recurring \| Level 1 \| Cash in bank balances
Assets:
Total cash and cash equivalents	14,460
Recurring \| Level 1 \| Money Market Funds
Assets:
Total cash and cash equivalents	33,239
Recurring \| Level 2
Assets:
Marketable securities	118,283
Recurring \| Level 2 \| U.S. government securities
Assets:
Marketable securities	36,192
Recurring \| Level 2 \| Non-U.S. Government Securities
Assets:
Marketable securities	11,182
Recurring \| Level 2 \| Corporate Debt Securities
Assets:
Marketable securities	39,443
Recurring \| Level 2 \| Commercial Paper
Assets:
Marketable securities	$ 31,466
Recurring \| Level 3
Liabilities:
Loans payable		12,880
Total		$ 12,880

Fair Value Measurements - Schedule of Aggregate Fair Value of Marketable Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Fair Value Disclosures [Abstract]
Due in one year or less	$ 74,531
Due after one year through two years	43,752
Total marketable securities	$ 118,283	$ 0

Fair Value Measurements - Additional Information (Details)	12 Months Ended
	Dec. 31, 2021 USD ($)
Fair Value Disclosures [Abstract]
Assets, Level 1 to Level 2 transfers	$ 0
Assets, Level 2 to Level 1 Transfers	0
Assets, Transfers into Level 3	0
Assets, Transfers out of Level 3	0
Liabilities, Level 1 to Level 2 transfers	0
Liabilities, Level 2 to Level 1 transfers	0
Liabilities, Transfers into Level 3	0
Liabilities, Transfers out of Level 3	$ 0

Loans Payable - Schedule of Loans Payable Reported at Fair Value and Measured on Recurring Basis (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	May 31, 2020	Dec. 31, 2021	Dec. 31, 2020
Short Term Debt [Line Items]
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock		$ 0	$ (17,690)
2020 Notes
Short Term Debt [Line Items]
Issuance of 2020 Notes and Bridge Loan	$ 15,000
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock	$ (15,900)
Recurring \| Loans Payable
Short Term Debt [Line Items]
Balance		12,880	0
Change in fair value of loans payable and other adjustments			3,053
Balance		$ 0	12,880
Recurring \| Loans Payable \| 2020 Notes and Bridge Loan
Short Term Debt [Line Items]
Issuance of 2020 Notes and Bridge Loan			16,800
Recurring \| Loans Payable \| Lilly Asia Ventures Option Exercise
Short Term Debt [Line Items]
Issuance of repurchase payable for the LAV Option exercise			10,771
Recurring \| Loans Payable \| Bridge Loan
Short Term Debt [Line Items]
Issuance of loans payable for conversion settlement of the Bridge Loan			2,109
Recurring \| Loans Payable \| Series C convertible preferred stock \| Bridge Loan
Short Term Debt [Line Items]
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock			(2,163)
Recurring \| Loans Payable \| Series C convertible preferred stock \| 2020 Notes
Short Term Debt [Line Items]
Conversion of 2020 convertible promissory notes to Series C convertible preferred stock			$ (17,690)

Loans Payable - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended		12 Months Ended
	Dec. 31, 2020	May 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 29, 2020	Dec. 31, 2019	Oct. 31, 2018	Apr. 30, 2017
Short Term Debt [Line Items]
Debt conversion, original debt, amount			$ 0	$ 17,690
Debt conversion to stock, aggregate debt plus accrued interest			$ 0	$ 2,163
Convertible preferred stock, shares issued	12,958,452		0	12,958,452
Bridge Loan
Short Term Debt [Line Items]
Debt Instrument, fair value	$ 2,100			$ 2,100
Proceeds from issuance of debt		$ 1,800
Debt instrument, interest rate		10.00%
Debt conversion, original debt, amount	1,800
Proceeds from debt payable in different currency, description			payable in renminbi (RMB) at an established USD/RMB exchange rate, based on an average of the previous five working days before May 8, 2020
Debt conversion to stock, aggregate debt plus accrued interest	$ 1,900
Debt conversion, accrued interest, amount					$ 100
Series C convertible preferred stock
Short Term Debt [Line Items]
Debt conversion, converted instrument, shares		1,366,820
Convertible preferred stock, shares issued	7,500,665			7,500,665
Series C convertible preferred stock \| Bridge Loan
Short Term Debt [Line Items]
Debt conversion, converted instrument, shares	167,159
Series A convertible preferred stock
Short Term Debt [Line Items]
Convertible preferred stock, shares issued	2,857,142			2,857,142				2,089,285
Series A convertible preferred stock \| LAV Affiliate
Short Term Debt [Line Items]
Convertible preferred stock, shares issued	767,857			767,857
Series B convertible preferred stock
Short Term Debt [Line Items]
Convertible preferred stock, shares issued	2,600,645			2,600,645			2,384,195
Series B convertible preferred stock \| LAV Affiliate
Short Term Debt [Line Items]
Convertible preferred stock, shares issued	216,450			216,450
2020 Notes
Short Term Debt [Line Items]
Proceeds from issuance of debt		$ 15,000
Debt instrument, interest rate		10.00%
Debt conversion, original debt, amount		$ 15,900
Debt conversion to stock, aggregate debt plus accrued interest	$ 15,900
2020 Notes \| Series C convertible preferred stock
Short Term Debt [Line Items]
Debt conversion, converted instrument, shares	1,366,820
Recurring \| Loans Payable
Short Term Debt [Line Items]
Debt Instrument, fair value	$ 12,880		$ 0	$ 12,880		$ 0
Recurring \| 2020 Notes \| Series C convertible preferred stock \| Loans Payable
Short Term Debt [Line Items]
Debt conversion, original debt, amount				$ 17,690

Loans Payable - Change in Fair Value of Loans Payable - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Mar. 31, 2021	Dec. 31, 2021	Dec. 31, 2020
Short Term Debt [Line Items]
Change in fair value of loans payable		$ 0	$ (2,887)
Loans Payable \| L A V Series A And Series B Promissory Note
Short Term Debt [Line Items]
Outstanding amount settlement from proceeds received from note receivable	$ 10,800
Series C convertible preferred stock \| Loans Payable
Short Term Debt [Line Items]
Proceeds from promissory note receivable	$ 1,900
Other Expense
Short Term Debt [Line Items]
Change in fair value of loans payable			$ 2,900
PWERM Method
Short Term Debt [Line Items]
Probability of IPO in the near term potential outcome percentage through loans payable value approach, scenario one			60.00%
Probability of company remaining private potential outcome percentage through loans payable value approach, scenario two			40.00%
Company remaining private potential outcome through loans payable value approach, period			1 year 9 months

Convertible Preferred Stock - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended				12 Months Ended
	Dec. 31, 2020	May 31, 2020	Oct. 31, 2018	Apr. 30, 2017	Dec. 31, 2021	Dec. 31, 2020	Feb. 28, 2021
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued upon conversion	16,079,230					16,079,230
Convertible preferred stock, shares issued	12,958,452				0	12,958,452
Convertible preferred stock, par value	$ 0.0001				$ 0.0001	$ 0.0001
Proceeds from sale of convertible preferred stock					$ 0	$ 69,377
Debt conversion to stock, aggregate debt plus accrued interest					$ 0	$ 2,163
Conversion Price	$ 25.63					$ 25.63
Increase to additional paid-in capital	$ 10,700					$ 10,700
Increase to earnings attributable to common stockholders	10,700
Bridge Loan
Convertible Preferred Stock [Line Items]
Debt conversion to stock, aggregate debt plus accrued interest	1,900
2020 Notes
Convertible Preferred Stock [Line Items]
Debt conversion to stock, aggregate debt plus accrued interest	$ 15,900
Series A convertible preferred stock
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued upon conversion	2,857,142					2,857,142
Convertible preferred stock, shares issued	2,857,142			2,089,285		2,857,142
Convertible preferred stock, par value				$ 10.50
Aggregate purchase price				$ 21,900
Series A convertible preferred stock \| LAV Affiliate
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued	767,857					767,857
Series A convertible preferred stock \| Terns China
Convertible Preferred Stock [Line Items]
Proceeds from sale of convertible preferred stock				$ 8,000
Series B convertible preferred stock
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued upon conversion	5,721,423					5,721,423
Convertible preferred stock, shares issued	2,600,645		2,384,195			2,600,645
Convertible preferred stock, par value			$ 30.80
Aggregate purchase price			$ 73,400
Conversion Price	$ 30.80					$ 30.80
Extinguishment at fair value	$ 79,700					$ 79,700
Fair value of shares	$ 69,000					$ 69,000
Series B convertible preferred stock \| LAV Affiliate
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued	216,450					216,450
Series B convertible preferred stock \| Terns China
Convertible Preferred Stock [Line Items]
Proceeds from sale of convertible preferred stock			$ 6,700
Series C convertible preferred stock
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued upon conversion	7,500,665					7,500,665
Convertible preferred stock, shares issued	7,500,665					7,500,665
Convertible preferred stock, par value	$ 11.65					$ 11.65
Gross proceeds from issuance and conversion of convertible preferred stock	$ 87,400
Debt conversion, converted instrument, shares		1,366,820
Series C convertible preferred stock \| Bridge Loan
Convertible Preferred Stock [Line Items]
Debt conversion, converted instrument, shares	167,159
Series C convertible preferred stock \| 2020 Notes
Convertible Preferred Stock [Line Items]
Debt conversion, converted instrument, shares	1,366,820
IPO
Convertible Preferred Stock [Line Items]
Convertible preferred stock, shares issued upon conversion							16,079,230

Convertible Preferred Stock - Schedule of Convertible Preferred Stock (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Oct. 31, 2018	Apr. 30, 2017
Convertible Preferred Stock [Line Items]
Convertible preferred stock,authorized	10,000,000	188,029,084
Convertible preferred stock, shares issued	0	12,958,452
Convertible Preferred Stock Outstanding	0	12,958,452
Carrying Value		$ 186,033
Liquidation Preference		$ 197,468
Common Stock Issuable Upon Conversion		16,079,230
Series A convertible preferred stock
Convertible Preferred Stock [Line Items]
Convertible preferred stock,authorized		40,000,000
Convertible preferred stock, shares issued		2,857,142			2,089,285
Convertible Preferred Stock Outstanding		2,857,142	2,089,285
Carrying Value		$ 30,000
Liquidation Preference		$ 30,000
Common Stock Issuable Upon Conversion		2,857,142
Series B convertible preferred stock
Convertible Preferred Stock [Line Items]
Convertible preferred stock,authorized		36,409,088
Convertible preferred stock, shares issued		2,600,645		2,384,195
Convertible Preferred Stock Outstanding		2,600,645	2,384,195
Carrying Value		$ 68,995
Liquidation Preference		$ 80,100
Common Stock Issuable Upon Conversion		5,721,423
Series C convertible preferred stock
Convertible Preferred Stock [Line Items]
Convertible preferred stock,authorized		111,619,996
Convertible preferred stock, shares issued		7,500,665
Convertible Preferred Stock Outstanding		7,500,665
Carrying Value		$ 87,038
Liquidation Preference		$ 87,368
Common Stock Issuable Upon Conversion		7,500,665

Common Stock and Stock-Based Compensation - Schedule of Common Stock Shares Reserved for Issuance (Details) - shares	Dec. 31, 2021	Dec. 31, 2020
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total shares reserved	4,956,107	18,563,456
Conversion of Outstanding Shares of Convertible Preferred Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total shares reserved	0	16,079,230
Options Outstanding Under Incentive Award Plans
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total shares reserved	3,577,485	2,466,670
Shares Available for Future Grant under Incentive Award Plans
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total shares reserved	1,138,622	17,556
Shares Available for Future Grant under Employee Stock Purchase Plans
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total shares reserved	240,000	0

Common Stock and Stock-Based Compensation - Additional Information (Details)		1 Months Ended	12 Months Ended
	Jan. 01, 2022 shares	Feb. 28, 2021 shares	Dec. 31, 2021 USD ($) Plan Vote shares	Dec. 31, 2020 USD ($) shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Common stock, voting rights			Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends
Number of voting rights per share \| Vote			1
Cash dividends declared or paid \| $			$ 0
Number of stock-based compensation plans \| Plan			2
Share-based compensation, vesting period			4 years
Share-based compensation, expiration period			10 years
Total shares reserved			4,956,107	18,563,456
Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized stock-based compensation expense related to unvested stock options \| $			$ 28,600,000	$ 26,700,000
Unrecognized stock-based compensation expense recognized period			2 years 11 months 26 days
Fair Value Of Options Vested \| $			$ 7,800,000	700,000
Restricted Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized stock-based compensation expense related to unvested stock options \| $			0	100,000
Fair Value Of Options Vested \| $			$ 100,000	$ 200,000
2021 Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based payment award, number of shares authorized		2,400,007
Increase of number of authorized shares reserved for issuance under the 2021 Plan	1,263,463
Share-based payment award, shares available for future grants			1,138,622
Increase of authorized shares, percent of common stock outstanding		5.00%
2017 Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Increase of number of authorized shares reserved for issuance under the 2021 Plan		0
2021 Employee Stock Purchase Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Percentage of fair market value of the shares on the offering date			85.00%
Percentage of fair market value of the shares on the purchase date			85.00%
Increase of number of authorized shares reserved for issuance under the 2021 Plan	252,692
Share-based payment award, shares available for future grants			240,000
Total shares reserved		240,000
Increase of authorized shares, percent of common stock outstanding		1.00%
Unrecognized stock-based compensation expense recognized period			11 months 1 day
Unrecognized stock-based compensation expense related to unvested employee stock purchases \| $			$ 100,000
2021 Employee Stock Purchase Plan \| Maximum
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share based compensation rate of payroll deduction			15.00%

Common Stock and Stock-Based Compensation - Summary of Stock Option Activity (Details) - Stock Options - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Number of Shares
Number of Shares, Outstanding beginning balance	2,466,670	478,135
Number of Shares, Granted	1,429,850	2,137,169
Number of Shares, Exercised	(156,104)	(38,285)
Number of Shares, Forfeited	(162,931)	(110,349)
Number of Shares, Outstanding ending balance	3,577,485	2,466,670	478,135
Number of Shares, Exercisable	1,937,772
Number of Shares, Vested and expected to vest	3,577,485
Weighted-Average Exercise Price
Weighted-Average Exercise Price, Outstanding beginning balance	$ 8.03	$ 4.48
Weighted-Average Exercise Price, Granted	11.83	8.57
Weighted-Average Exercise Price, Exercised	5.86	3.09
Weighted-Average Exercise Price, Forfeited	8.28	2.93
Weighted-Average Exercise Price, Outstanding ending balance	9.72	$ 8.03	$ 4.48
Weighted-Average Exercise Price, Exercisable	8.35
Weighted-Average Exercise Price, Vested and expected to vest	$ 9.72
Weighted-Average Remaining Contractual Term and Aggregate Intrinsic Value
Weighted-Average Remaining Contractual Term, Outstanding	9 years 1 month 2 days	9 years 7 months 9 days	8 years 11 months 8 days
Weighted-Average Remaining Contractual Term, Exercisable	8 years 8 months 15 days
Weighted-Average Remaining Contractual Term, Vested and expected to vest	9 years 1 month 2 days
Aggregate Intrinsic Value, Outstanding, beginning balance	$ 21,678	$ 2,277
Aggregate Intrinsic Value, Outstanding, Exercised	858	167
Aggregate Intrinsic Value, Outstanding, ending balance	491	$ 21,678	$ 2,277
Aggregate Intrinsic Value, Exercisable	453
Aggregate Intrinsic Value, Vested and expected to vest	$ 491

Common Stock and Stock-Based Compensation - Schedule of Stock Options Weighted Average Assumptions (Details) - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Employee Stock Purchase Plans
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term (years)	9 months
Expected volatility	60.82%	0.00%
Risk-free interest rate	0.17%	0.00%
Fair value of underlying common stock	$ 6.53	$ 0
Weighted average grant-date fair value per share	$ 2.33	$ 0
Stock Options
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Expected term (years)	6 years 10 days	6 years 21 days
Expected volatility	76.60%	62.02%
Risk-free interest rate	1.12%	0.49%
Fair value of underlying common stock	$ 11.83	$ 17.97
Fair value of option	$ 7.82	$ 12.84

Common Stock and Stock-Based Compensation - Summary of Restricted Stock Award Activity (Details) - Restricted Stock - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Number of Shares
Number of Shares, Unvested restricted common stock, beginning balance	83,334	166,667
Number of Shares, Vested	(71,429)	(83,333)
Number of Shares, Forfeited	(11,905)
Number of Shares, Unvested restricted common stock, ending balance	0	83,334
Grant-Date Fair Value
Grant-Date Fair Value, Unvested restricted common stock, beginning balance	$ 1.96	$ 1.96
Grant-Date Fair Value, Vested	1.96	1.96
Grant-Date Fair Value, Forfeited	1.96
Grant-Date Fair Value, Unvested restricted common stock, ending balance	$ 0	$ 1.96

Common Stock and Stock-Based Compensation - Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total stock-based compensation expense	$ 8,146	$ 1,691
Research and Development Expense
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total stock-based compensation expense	2,055	373
General and Administrative Expense
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Total stock-based compensation expense	$ 6,091	$ 1,318

Income Tax - Components of (Loss) Income Before Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
U.S.	$ (49,733)	$ 1,180
Foreign	83	(40,938)
Loss before income taxes	$ (49,650)	$ (39,758)

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Income Tax - Schedule of Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Current
Federal	$ 105	$ 128
State	1	1
Foreign	313	279
Total current	419	408
Deferred
Federal	0	449
Foreign	89	(44)
Total deferred	89	405
Total income tax expense	$ 508	$ 813

Income Tax - Reconciliation between Effect of Applying Federal Statutory Rate and Effective Income Tax Rate (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Tax benefit at U.S. statutory rate	21.00%	21.00%
Foreign income taxed at non-U.S. rates	(0.37%)	(22.10%)
Domestication	32.57%	0.00%
Other permanent items	(0.07%)	(0.16%)
Stock-based compensation	(0.52%)	(0.16%)
Research and development credits	2.14%	2.28%
Unrecognized tax benefit	(1.18%)	(0.71%)
Global intangible low-taxed income	0.00%	(0.32%)
Increase in valuation allowance	(54.53%)	(2.01%)
Other	(0.05%)	0.14%
Effective tax rate	(1.02%)	(2.04%)

Income Tax - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Accruals and reserves	$ 575	$ 619
Intangibles	14,574	0
Stock-based compensation	1,582	340
Net operating loss	10,271	28
Research and development credits	1,930	683
Other	87	0
Valuation allowance	(28,849)	(1,431)
Total deferred tax assets	170	239
Deferred tax liabilities:
Fixed assets	(78)	(58)
Total deferred tax liabilities	(78)	(58)
Net deferred tax assets	$ 92	$ 181

Income Tax - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Taxes [Line Items]
Net deferred tax assets	$ 92	$ 181
U.S. federal statutory tax rate	21.00%	21.00%
California R&E credit carryforward	$ 1,930	$ 683
Unrecognized tax benefits	5,849	5,406	$ 4,709
Foreign Tax Positions
Income Taxes [Line Items]
Operating loss carryforwards	$ 200	0
Operating loss carryforwards, expiration date	Dec. 31, 2023
Federal research and development credit carryforwards	$ 1,900	800
California R&E credit carryforward	1,700	1,200
Unrecognized tax benefits	5,800	5,400
Unrecognized tax benefits, that would affect income tax expense	$ 4,500	4,200
Foreign Tax Positions \| Research and Experimentation (R&E)
Income Taxes [Line Items]
Operating loss carryforwards, expiration date	Dec. 31, 2040
Federal
Income Taxes [Line Items]
Operating loss carryforwards	$ 48,700	0
State
Income Taxes [Line Items]
Operating loss carryforwards	$ 400	$ 0
Operating loss carryforwards, expiration date	Dec. 31, 2041

Income Tax - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefit at beginning of year	$ 5,406	$ 4,709
Increases related to prior year tax positions	365	0
Increases related to current year tax position	451	697
Decreases related to prior year tax positions	(373)	0
Unrecognized tax benefit at end of year	$ 5,849	$ 5,406

Net Loss Per Share of Common Stock - Schedule of Computation of Basic and Diluted Net Loss per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Numerator:
Net loss	$ (50,158)	$ (40,571)
Net loss attributable to non-controlling interest	0	(518)
Net loss attributable to common stockholders	$ (50,158)	$ (29,352)
Denominator:
Weighted average common stock outstanding, basic and diluted	22,705,948	285,162
Net loss per share attributable to common stockholders, basic and diluted	$ (2.21)	$ (102.93)
Series B Preferred Stock
Numerator:
Extinguishment of Series B convertible preferred stock		$ 10,701

- Definition

Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities; of income (loss) available to common shareholders.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

- Definition

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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+ Details

Net Loss Per Share of Common Stock - Schedule of Antidilutive Securities Excluded from Computation of Net Loss per Share (Details) - shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	3,584,202	18,629,234
Options to Purchase Common Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	3,577,485	2,466,670
Restricted Common Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	0	83,334
Convertible preferred stock (as converted to common stock)
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	0	16,079,230
Shares Issuable Under Employee Stock Purchase Plan
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	6,717	0

Commitments and Contingencies (Additional Information) (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Mar. 31, 2019
Foster City, California
Lessee, Lease, Description [Line Items]
Lease expiration		2 years 10 months
Option to extend		The Company has the option to extend the lease agreement for a period of five years.
Rent expense		$ 48,000
Suzhou China
Lessee, Lease, Description [Line Items]
Lease expiration	9 months
Rent expense	$ 4,000

Commitments and Contingencies - Schedule of Future Minimum Lease Payments Due Under Operating Leases (Details) $ in Thousands	Dec. 31, 2021 USD ($)
Leases [Abstract]
2022	$ 669
2023	652
2024	559
2025 and thereafter	0
Total	$ 1,880

Assignment, License and Collaboration Agreements - Additional Information (Details)	1 Months Ended					12 Months Ended
	Nov. 30, 2021 USD ($)	Jul. 31, 2020 USD ($)	Jun. 30, 2019 CNY (¥)	Mar. 31, 2018 USD ($)	Feb. 28, 2018 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Assignment License And Collaboration Agreements [Line Items]
License revenue						$ 1,000,000	$ 0
TERN-101 License Agreement with Eli Lilly
Assignment License And Collaboration Agreements [Line Items]
Agreement milestones payment						0
Research and development expense						0	0
TERN-101 License Agreement with Eli Lilly \| China
Assignment License And Collaboration Agreements [Line Items]
Aggregate pre-specified development milestones for the first covered product					$ 6,000,000.0
Aggregate pre-specified development milestones for the first covered product in ex-mainland					$ 50,000,000.0
TERN-201 License Agreement with Eli Lilly
Assignment License And Collaboration Agreements [Line Items]
Aggregate pre-specified development milestones for the first covered product				$ 74,000,000.0
Agreement milestones payment						0
Research and development expense						0	0
Aggregate pre-specified development milestones for second indication of covered product				$ 30,000,000.0
Amount paid under the agreement						4,000,000.0
TERN-201 License Agreement with Eli Lilly \| Research and Development Expense
Assignment License And Collaboration Agreements [Line Items]
Upfront payment									$ 4,000,000.0
Assignment Agreement
Assignment License And Collaboration Agreements [Line Items]
Aggregate pre-specified development milestones for the first covered product \| ¥			¥ 205,000,000.0
Research and development expense						0	1,500,000
Amount paid under the agreement						$ 2,200,000
Number of days advance written notice						60 days
Milestone payment						$ 1,500,000
Assignment Agreement \| Research and Development Expense
Assignment License And Collaboration Agreements [Line Items]
Upfront payment								$ 700,000
Hansoh Option and License Agreement
Assignment License And Collaboration Agreements [Line Items]
Upfront payment received							$ 800,000
License revenue	$ 1,000,000.0
Hansoh Option and License Agreement \| Maximum
Assignment License And Collaboration Agreements [Line Items]
Amount agree to pay in pre-specified clinical, regulatory and sales milestones		$ 67,000,000.0