Cramer’s Home Work: A New Biopharma Idea

(Having trouble with the video? Click here!)

Sometimes Jim Cramer tells a caller that he needs to do homework before he can make a decision on a stock. And he's not kidding.

Following is Cramer's research or homework on a stock recently called to his attention by an investor who watches the TV show.

Cramer’s Homework: Less Familiar Stocks, but Less Attractive?
Tooga | Getty Images

Trius Therapeutics

On Wednesday May 1, Jeff in California asked about Trius Therapeutics a biopharma company focused on the discovery, development and commercialization of innovative antibiotics for serious, life-threatening infections.

As with so many companies in this sector, Cramer believes the fortunes of Trius are tied to the success of its pipeline. And Cramer's homework suggests that the pipeline shows promise.

Read More from Mad Money with Jim Cramer
Cramer: Shifting Winds Sweeping Street
Energy Quest: Cramer's Gulf Plays
Allergan's Latest FDA Victory

"I think their drug Tedizolid, for MRSA skin infections, has a solid chance for approval in the back half of the year," Cramer said. "The company has $100 million in cash to fund commercial operations, and Tedizolid could garner peak sales of $800 million. So I favor the risk reward here, but please use price limits. Biotech investing is tricky, especially within these tiny micro caps."

Call Cramer: 1-800-743-CNBC

Questions for Cramer?

Questions, comments, suggestions for the "Mad Money" website?