A month after rejecting a hostile bid, Ista Pharmaceuticals says it has received a higher offer from Valeant Pharmaceuticals International.

Just before Christmas, Valeant's $6.50 per share offer, which valued the eyesore specialist at $314 million, was dismissed as "grossly inadequate" by Ista. However, last week, the firms' management met and Valeant has raised its initial proposal to $7.50 per share in cash and set a target price of $8.50 per share in cash, subject to one week of due diligence.

Valeant is not the only company interested in Ista, it seems, and the latter's chief executive Vicente Anido noted that as part of a strategic review, it is currently in dialogue with a number of companies. "We have invited Valeant, along with a number of other parties, to participate in our process," he said, adding that its "willingness to raise its bid at least $2.00 per share" is a "clear indication of the inadequacy of its initial proposal."

Mr Anido stated that Valeant has been offered "the same confidentiality agreement, with no standstill provision, as all the other participants in our process and is subject to the same timeline". He noted that if the Canadian firm signs up, it will be provided with "the same non-public information that we are providing to other parties".

He concluded by saying "we do not think it is in the shareholders' best interest to abort our process to accommodate Valeant's artificially short timetable". Doing so "would effectively foreclose the opportunity for a number of other interested parties to compete."