Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of XenoPort (UNKNOWN:XNPT.DL), a biopharmaceutical company focused on developing therapies to neurological disorders, gained as much as 18% following a press release that it mailed a proxy letter to shareholders urging them to vote for its three nominated board members in an upcoming board election.

So what: According to the press release from XenoPort, Clinton Relational Opportunity Master Fund, beneficial owner of 1.8% of XenoPort's common stock, has nominated three of its own members to be placed on XenoPort's board of directors. In response, XenoPort mailed letters to its stockholders urging them to vote in XenoPort's three suggested candidates. The highlights of the letter including the ongoing commercialization of restless-leg syndrome therapy Horizant, the development of XP23829, a fumaric acid ester candidate being studied as a therapy for relapse-remitting multiple sclerosis and psoriasis, and the notion that Clinton's board nominees may undermine the current board's goal of enhancing shareholder value.

Now what: You still might be scratching your head a bit and wondering why XenoPort is moving higher. The simple answer is that shareholders are going to be winners after this board election regardless of which side is the victor. Clinton is obviously intent on boosting the underlying value of its equity position, which would align nicely with shareholders. On the flipside, if XenoPort's nominees win it keeps intact the company's plan to expand Horizant's commercialization and focus on XP23829's development. Given that revenue should more than double this year and nearly double again in fiscal 2015, the company is obviously doing something right. As an investor I'd certainly like to see XenoPort's losses narrow a bit before I considered the company a viable investment opportunity, but at this point I'd have no trouble suggesting the company be added as watchlist candidate.

Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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