Icahn’s Stake, Influence Rise at ImClone

Carl Icahn increased his stake in ImClone Systems Inc. and hasn’t yet decided whether to join the biotechnology company’s board, according to a regulatory filing.

The company, best known for its role in the Martha Stewart trading scandal, offered a board seat to the billionaire U.S. investor last week, after ImClone abandoned a six-month search for a buyer. Icahn, ImClone’s second-biggest stockholder, raised his stake to 11.7% from about 10%, according to a filing Monday with the Securities and Exchange Commission.

Icahn, 70, is known for taking stakes in companies to pressure management to improve stock prices. ImClone agreed in May to add a board member he supported, and last week the company said it would allow him to choose an additional independent director.

Shares of New York-based ImClone rose 63 cents, or 2.2%, to $28.74.

Icahn owns 9.8 million shares of ImClone through his affiliated companies, according to the filing. He didn’t return a phone message to his New York office.

ImClone decided to remain independent after multiple bidders failed to meet ImClone’s price, interim Chief Executive Joseph L. Fischer said Thursday.

The company said it no longer sought a buyer because of rising sales of its only product, the cancer drug Erbitux. Approved in 2004 for colon cancer, Erbitux got a boost in March, when it was cleared as the first treatment for head and neck tumors in 45 years.

Erbitux was developed by Samuel D. Waksal, who stepped down as CEO in 2002 and pleaded guilty that year to charges of insider trading related to regulators’ initial rejection of the cancer drug’s application.

The scandal also ensnared Waksal’s friend Stewart, who served a five-month prison sentence for lying to prosecutors. Last week, Stewart, the founding editorial director of Martha Stewart Living Omnimedia Inc., agreed to pay $195,000 to settle a related insider trading investigation by the Securities and Exchange Commission.