Moderna is in the early stages of creating medicine using messenger RNA, which transports genetic information from DNA to a body's cells so they can produce the proper proteins to express those genes. Moderna's idea is to engineer messenger RNA in patients with genetic diseases to tell their cells to produce different, potentially life-changing proteins.
But if investors view the stock "purely as speculation, Moderna has a few major things going for it," Cramer said. "It's recession-proof at a time when many investors are now worried about a slowdown. It's got an exciting concept; you can argue that messenger-RNA-based medicine could revolutionize health care. And the stock has pulled back dramatically in the short time since it's been public."
So while it might not be the right play for people investing for retirement, investors with some cash to spare might find Moderna to be an interesting bet if they believe in the story, the "Mad Money" host said.
What sets Moderna apart? While other companies including Ionis Pharmaceuticals are working on similar treatments, Moderna's focus on delivery and manufacturing technologies puts it in a class above its rivals, Cramer argued.
In short, Moderna has developed technology that makes it easier for its messenger RNA to reach the correct place in a patient's body without running into the immune system, which can degrade the new RNA. Moderna is also working on manufacturing tech that will allow it to mass-produce its treatments once it gets federal approval, though that is still years away.
The company has struck high-profile partnerships with biotech giants Merck and AstraZeneca, which is also Moderna's fourth-largest shareholder. Those deals, which manifest themselves in the form of "milestone payments" as Moderna's drugs reach various thresholds of success, speak to the legitimacy of the company's mission, Cramer said.
"The industry clearly believes the technology is worth betting on," he said. "These companies understand the potential of messenger-RNA-based medicine."
Cramer acknowledged why investors might be wary of buying shares in Moderna: the company has no earnings or sales yet and spends fortunes on its 21 development programs, 10 of which are in the early stages of clinical trials.
But the corporate investments have allowed the company to maintain a clean balance sheet, which now boasts $1.8 billion in cash to spare thanks to the IPO, he said.
"Early-stage biotechs like this one don't trade on the numbers, they trade on belief," the "Mad Money" host explained. "In about a month, Moderna's quiet period ends, and the analysts will start rolling out their coverage. If they tell a bullish story, and I think they probably will, this stock can rally."
So even though Moderna's stock has lost nearly $1.5 billion in value since its IPO, investors would be better off judging the biotech on whether they think its treatments can succeed than on the stock's circumstantial action, Cramer said.
"These speculative biotechs are a lot like [the Yankees'] Giancarlo Stanton — when he steps up to the plate, he's likely to either strike out or hit a home run," he joked. "If you're trying to save for retirement, Moderna is not the stock for you. However, if you want to take a chance with your speculative 'Mad Money' portfolio, you have got my blessing to buy this one. I know it can probably still go lower, but you're getting a pretty darn good entry point."