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Actionable news in ARIA: ARIAD Pharmaceuticals, Inc.,

Under New Structure, ARIAD Growth Opportunities May Be Undervalued


The pharmaceutical company's stock valuation doesn't seem to incorporate new management's transformative strategy that seeks to improve focus, efficiency and business fundamentals.

Pipeline of new advancements full while addressable patient market poised for significant growth.

With acquisitions ongoing in the pharmaceutical sector, ARIAD could be target for a buyout.

ARIAD Pharmaceuticals, Inc. (NASDAQ:ARIA), a mid-cap oncology company focused on precision therapies that treat rare cancers, is undergoing a corporate restructuring under the leadership of its new president and CEO, Paris Panayiotopoulos.

With deep experience in pharmaceuticals and executive management, Panayiotopoulos joined ARIAD in January 2016 and is leading positive change that should position the company to execute on its short- and long-term growth objectives. Although ARIA rose nearly 27 percent in July, there is still upside potential as efficiencies are gained, the addressable market expands and new breakthrough technologies develop.

Restructure, Refocus and Improved Business Fundamentals

The restructure includes across-the-board changes that are already showing constructive financial improvements. At its global headquarters in Cambridge, MA, 90 positions were eliminated, which is a 25 percent reduction of headcount at the company's headquarters. A necessary part of the restructuring, this decision helped to strengthen the company's balance sheet and contributed to the reduction in operating costs by ~$65 million. No customer-facing positions in commercial or medical...