The exchange-traded fund has jumped more than 16 percent this year. It rose 0.3 percent on Thursday, closing around $353 per share.
Trader Jon Najarian believes Biogen and Amgen—the ETF's two highest-weighted companies—hold upside. Biogen and Amgen both closed higher on Thursday at about $425 and $160 per share, respectively.
Isis Pharmaceuticals—which spiked 3 percent on Thursday—could make a strong long play, trader Guy Adami said.
Jon Najarian is long ABT, ADBE, ADP, ADT, AN, ATVI, AVP, BBY, BSX, EQT, EXXI, HUN, INFN, LL, MNST, MRVL, MW, NEE, NOK, NRG, NSAM, OAS, POST, RHT, RKUS, SCTY, SIRI, SOL, SYK, TEVA, TTWO, TWX, WMB, XLI, XPO and ZIOP. He is long calls AKS, APD, BABA, BBY, EQT, EWJ, GRPN, IDTI, MET, MNST, MYL, NTAP, PPC, PRU, RAD, RKUS, SAP, SNDK, TAP, TWX, XPO and ZIOP. Today, he bought XPO calls, AVP, XLI and XPO.
Steve Grasso is long AAPL, EVGN, MJNA, PFE, T, TWTR and GDX. His firm is long AVP, AMD, IBM, ZNGA. His kids own EFG, EFA, EWJ, IJR and SPY.
Brian Kelly is long BTC=, U.S. dollar, GLD, EEM, CTRL calls, GSG, BBRY, SPY puts, TLT, 30-year bond futures. He is short yuan.
Guy Adami is long CELG, EXAS and INTC. Guy Adami's wife, Linda Snow, works at Merck.