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A Biotech Buy for the Bold

TGIF. And not because the weekend’s here. Friday is when Cramer gives out his speculative pick of the week. These are the smaller, more volatile plays that can pop on good data or a product release. Of course, they can plummet to zero on bad news, too.

But that’s why speculation’s a sport saved only for Fridays on Mad Money. Cramer wants Home Gamers to have the weekend to mull things over. If you choose to follow his advice, just remember the same rules always apply: Don’t buy in the after hours; be sure to use limit orders.

CV Therapeutics is an unprofitable drug development company that specializes in small molecule drugs for cardiovascular diseases. Maybe it’s no surprise then that, as of May 10, 36% of the float had been sold short. But the bears might be off the mark here, Cramer says.

CV Therapeutics has two drugs that could boost its earnings enough to help the stock. Ranexa is the only angina drug approved in decades in a multibillion-dollar market, and there’s a chance it could get the nod as a diabetes treatment (another huge market), too. Regadenoson, which is used in tests to detect coronary artery disease, is in late-stage development, and it’s on track for 2008 approval. The 20% cut CVTX would make on the expected sales of $500 million would be a healthy addition to the company’s bottom line.

There’s always the chance of a buy out as well. Some pipeline-challenged big pharma company could pay as much as $20 to $30 a share for CV Therapeutics and its assets, Cramer says.

But Cramer could be wrong. CV Therapeutics trades on dreams, not earnings, he says. Bad news could really kill this stock – the way it did in March on two sets of disappointing Ranexa data.

Bottom Line: CVTX could get your head chopped off, or it could double your money through its earnings or a takeover.

Questions? Comments? madcap@cnbc.com

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