Shire plc (ADR) (SHPGY)

Shire as bid target: possible bid war, both AstraZeneca (AZN) and Pfizer (PFE) are showing interest.

Shire's fresh gains on Tuesday (March 18, 2008) were sparked by a note from UBS, which argued that AstraZeneca could pay up to 1,425 pence per share ($86.79 per U.S.-listed share) in cash for the deal to still lift earnings. There's also speculation that Shire could be bought by Pfizer too; in turn, igniting hope that a bid war will develop between two of the world's largest pharmaceutical companies, both with one goal in mind: SHPGY.

Even if the deal went for a price of $77, substantially below the $86.79 estimate, we're still looking at a hefty increase in Shire's share price.

After the launch of Vyvanse, Shire has increasingly been able to switch users off its top-selling drug onto the newer one, and Vyvanse's market share for U.S. prescriptions has climbed 26% over the last three months, according to a Deutsche Bank research note citing IMS data.

Shire also recently launched Elaprase, a drug to treat Hunter Syndrome.

And there's more in the pipeline -- the company counts 16 prospects between now and 2015.

Bottom line: with so much growth potential for SHPGY, coupled with a possible bid war from other pharma titan's, investors should take heed -- keep an eye out on this stock because we're likely to see things continue to heat up as the days go by.