Sarissa Capital Wants to Replace CEO of Ariad Pharmaceuticals

Activist hedge fund Sarissa Capital has ramped up pressure to replace the CEO of Ariad Pharmaceuticals (ARIA), one year after winning a seat on the biotech company's board.

Sarissa owns less than 7% of Ariad’s stock, or approximately 12.9 million shares.

The hedge fund was formed in 2013 by Alex Denner, who ran biotech investing for Carl Icahn for five years, and Richard Mulligan, a Harvard professor who worked with Denner and Icahn on several investments. 

Ariad’s stock was hammered in October 2013 after safety concerns were raised regarding with its leukemia drug, Iclusig. Sarissa subsequently won a seat on Ariad’s board in February 2014, as well as the right to add a second director mutually agreed upon by the company.

That second board member has not yet been named. 

Ariad CEO Harvey Berger, the company's founder, is up for board re-election this year, along with two other members of the eight-member board. Notification date for new director proposals is Feb. 25, according to Ariad's 2014 proxy filing, with the election at the company’s annual meeting in June.

Denner has pursued activist agendas with Otsuka Pharmaceuticals and Vivus in recent years, and disclosed a 5.76% stake in Aegerion Pharmaceuticals in 13D securities filings earlier this month.