NEW YORK (AP) -- Shares of Ariad Pharmaceuticals moved higher Thursday after a JPMorgan analyst said physicians may not be that concerned about recently disclosed side effects of Ariad's cancer pill Iclusig.
THE SPARK: Analyst Cory Kasimov said there are still a lot of unanswered questions about the side effects of Iclusig, but they may not hurt sales as much as investors fear. Kasimov said his firm surveyed 50 hematologists and oncologists about the drug and found that most who prescribe Iclusig don't plan to change their prescribing patterns.
"Our initial view is that the physician community may be far less spooked by the safety update than the investor community," he wrote. Kasimov kept an "Overweight" rating on Ariad shares and a price target of $12.
THE BIG PICTURE: Iclusig is used to treat two rare types of leukemia. The Food and Drug Administration approved it in December.
On Oct. 9, Ariad Pharmaceuticals Inc. disclosed a higher rate of serious side effects of Iclusig and regulators halted enrollment in new tests for the drug. Ariad said after two years of research, 11.8 percent of patients treated with Iclusig in a clinical study had suffered serious blood clots in an artery. After 11 months of treatment 8 percent of patients had those side effects.
As a result the Food and Drug Administration has halted enrollment of new patients in all clinical trials of Iclusig, and patients who are being treated with the drug in those trials will have their dosages reduced. Ariad, of Cambridge, Mass., said it is consulting with the FDA and other health regulators about changing the label on Iclusig to reflect the new information.
On Friday the FDA said it was investigating reports of dangerous blood clots in patients treated with Iclusig.
SHARE ACTION: Ariad stock rose 41 cents, or 10.2 percent, to $4.45 in afternoon trading. The shares are down 76.4 percent since Oct. 8.