Cullinan Therapeutics Inc. (NASDAQ:CGEM) shares drop 9.23% as strategic shift and narrowed pipeline spark investor skepticism

Cullinan Therapeutics Inc. (NASDAQ:CGEM) saw its shares drop 9.2282% in pre-market trading on December 16, 2025, marking a sharp reversal following recent bullish analyst activity. The selloff contrasts with earlier optimism from Clear Street, which had upgraded its price target for the biopharma firm to $33 from $22 in late November after reviewing updated Phase 1 data for CLN-049.

The firm’s strategic shift to focus on high-conviction therapies has intensified scrutiny. In Q3 2025, Cullinan reported a $50.6 million net loss—up from $40.6 million in the same period in 2024—as it scaled back operations by discontinuing CLN-619 and CLN-617 programs. This streamlining aims to preserve its $475.5 million cash runway through 2029 while concentrating resources on T cell engager-based treatments for oncology and autoimmune diseases.

Analysts remain divided, with Clear Street’s upgraded model projecting CLN-049 could achieve $500 million in peak sales by 2040. However, the recent pre-market decline suggests investor skepticism persists, particularly as the company navigates a narrowing pipeline and elevated R&D costs ahead of its 2028 commercialization timeline for the key asset.

Cullinan's R&D expenses have continued to rise, a trend exacerbated by the discontinuation of two clinical programs. Investors are now watching closely how the company will allocate its remaining resources. While the financial strategy appears prudent in preserving liquidity, the market has not yet responded positively to the company's risk-mitigation approach, as reflected in the sharp price correction on December 16.

Long-term investors remain hopeful that the company’s refocused pipeline will yield positive results, particularly as it moves toward its 2028 commercialization goals. However, the next six months will be critical in validating the strategic shift and in demonstrating that the firm can deliver meaningful milestones with its remaining assets.