Tomahawk, WI 01/28/2014 (BasicsMedia) – Ariad Pharmaceuticals Inc (NASDAQ:ARIA) reported its biggest one day profit in more than a period of one month. The shares of the drug maker rose by 20% to close at $8.99 at the close in New York yesterday. This was the Cambridge, Massachusetts based company’s third rise in a row after investors played a bet in favor of the company likely to attract attention of larger drug makers.

Last year, the cancer therapy developer had lost almost 64% of its market value after its only marketed drug Iclusig was withdrawn from the U.S. market. In October, 2013, Iclusig was suspected to cause cardiovascular damages because of which the drug‘s marketing was stopped for a short time until December. Two months later, the Food and Drug Administration allowed the drug to be sold once again, but with restrictions. In December hence, Ariad Pharmaceuticals Inc (NASDAQ:ARIA) re-introduced Iclusig in the market but with label warning it to be aimed at only a few patients.

Ariad attracts bigger players in the field

After a recent report by the U.K.’s Daily Mail suggesting that Ariad could be taken over by larger companies, shares of the company have rapidly shot up. According to an analyst at BMO Capital Markets named Jim Birchenough, the global oncology company offers a highly resourceful platform for drug discovery. In a research note, he wrote that their chronic or accelerated myeloid leukemia treating drug Iclusig is of great significance in the field. Iclusig is also under research for treatment of other forms of cancer. Iclusig AP26113, a molecularly targeted drug is still in developing stage, being tested for effectiveness in treating lung cancer.

Investors seek board membership

In October, the activist investment fund Sarissa Capital Management, run by Alex Denner, sought representation in Ariad Pharmaceuticals Inc (NASDAQ:ARIA)’s board after having purchased around 6.2% shares of the company. Denner worked in the health care investments field earlier along with billionaire Carl Icahn. By acquiring 11.5 million shares of the company, he certainly drew attraction towards his interests in the company. Moreover, the fund, which is the second largest shareholder of Ariad Pharmaceuticals Inc (NASDAQ:ARIA) has recently increased its stake in the company. The health care investor has increased his possession of Ariad’s shares to 12 million which makes his stake in the company rise up to 6.5%. Denner lays great stress on the benefit that Iclusig could bring to a vast number of patients. He also had a talk with the company about their membership in the Ariad’s board last week.

Ariad is hot talk among pharma companies

Sarissa is not the only fund that has been drawn towards Ariad, which stands today with a market value of as much as $1.75 billion. Indianapolis based Eli Lilly & Co. (NYSE:LLY) and Dublin based Shire Plc (ADR) (NASDAQ:SHPG) have also shown their interests in the company, according to Daily Mail. However, none of the two have commented anything in this context. Another one that Daily Mail mentioned in its report is GlaxoSmithKline Plc. (ADR) (NYSE:GSK), which is based out of London.

BMO’s Brichenough raised his rating on Ariad’s stock to outperform and raised the target for the company’s shares from $8 to $14.

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