Icahn received clearance last week from the Federal Trade Commission (FTC) to purchase more shares in the company after the waiting period under the Hart-Scott-Rodino Act expired.
The Hart-Scott-Rodino Act is a federal law forbidding businesses from monopolising the market.
It requires that any company or individual seeking to acquire over $59.8m (€43.7m) in another company has to file a notification with the federal government.
However, an FTC spokesperson told Biopharma-Reporter.com that the number of shares Icahn could now purchase was not disclosed.
But the FTC go-ahead sent Biogen's shares to a 52-week-high yesterday, fuelling rumours of acquisition of the US-based biologic drug maker.
However, Naomi Aoki, Biogen Idec's spokesperson, told Biopharma-reporter.com that her company was not currently discussing any potential share purchase with Icahn. Icahn, through one of his investment companies Icahn Management, had already purchased 2.74m Biogen shares on 14 August - about 1 per cent stake - which is worth approximately $170m on today's share price.
If Icahn decides to take a bigger stake in Biogen, it could give a further boost to the firm which has been recovering from the hurdles it suffered with its multiple sclerosis drug Tysabri (natalizumab), as the investor has proved more than efficient at raising the market value of biotech firms.
Last April, MedImmune agreed to be bought by AstraZeneca for $15.6bn after being pressured by shareholders, and in particular by Icahn, to consider an acquisition.
The deal was a 53 per cent premium over where the shares traded before the company said it might be for sale.
The billionaire shareholder said before the purchase announcement that he threatened a proxy fight against MedImmune's board if it did not consider an acquisition and got what he wanted.
The same scenario could be repeated with Biogen, which is worth $18bn in market capital.
Icahn failed to return a call seeking comment.
Biogen recently announced healthy financial results for the second quarter of the year, boosted by high sales of its three leading drugs.
The Massachusetts-based firm posted a $206m operating income for the quarter ended 30 June 2007, compared to a $122m loss in the same quarter last year.
This major improvement was due to the $300m charges included the second quarter of 2006, that were related to the acquisitions of Conforma Therapeutics and Fumapharm.
In addition, the biotech company's revenue jumped 17 per cent to $773m, driven by strong sales growth for its Avonex (interferon beta-1a), Rituxan (rituximab) and Tysabri drugs.
The company said it was "quite pleased" with its second quarter performance, and raised its financial forecast for the full year.