Ariad Pharmaceuticals Inc, which has been struggling with safety concerns involving its only approved drug, said it agreed to add two directors backed by its second-largest investor Sarissa Capital Management to its board.
Ariad shares rose 3 percent to $8.98 in early trading.
The company said Alexander Denner - investor Carl Icahn's former healthcare lieutenant and Sarissa's chief investment officer - will assume one of the seats.
The other director would be selected by the board, "subject to Denner's concurrence," Ariad said.
Activist fund Sarissa, which holds a 6.46 percent stake in Ariad, had been seeking at least two board seats at the company, Reuters reported earlier this month, citing people familiar with the matter.
Ariad is the third company in which Sarissa has assumed an activist stance since launching last year, following investments in obesity drug maker Vivus Inc and Astex Pharmaceuticals Inc, which was acquired by Japan's Otsuka Holdings Co in October.
At Vivus, Sarissa joined forces with another investor, First Manhattan, to overthrow the management as the company grappled with slow sales of diet drug Qsymia.
Ariad also faces the challenge of ramping up sales of its leukemia drug Iclusig.
Sales of Iclusig were suspended in October after an investigation by the U.S. Food and Drug Administration found that a large number of patients developed life-threatening blood clots or narrowing of veins.
The company resumed selling the drug in January, but only after the FDA limited its use to patients with a specific genetic mutation and to those who are unable to use alternative treatments such as Novartis AG's Gleevec or Bristol Myers Squibb Co's Sprycel.
JMP Securities analyst Michael King Jr. said he expects Denner to give some time for the drug to gain momentum.
"Look at what he is doing with Vivus. He is not agitating for sale, but trying to let the new management team work it out and improve the sales of Qsymia," King said.
"Forcing a sale when the drug is not doing well is counter to your own best interests."
Ariad shares, which were trading at $17.14 in early October before Iclusig's safety concerns were first made public, plunged to a low of $2.15 after the drug's sale was suspended. They have regained some of their value since the drug's re-entry in the market.
(Reporting by Esha Dey in Bangalore; Editing by Saumyadeb Chakrabarty)