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A Smart Bet on Biotech?

When it comes to speculating on biotech stocks, there’s nothing like Food & Drug Administration drug approval to make a share price soar. But betting on whether just one drug gets the thumbs-up or down could be too risky. It’s better to spread that risk out a bit, like, say with a company with two treatments before the FDA.

Like Alkermes. The company uses its technology to improve existing drugs by making it less burdensome for patients to take them. Take Risperdal, for instance, which is used to treat schizophrenia and bipolar disorder. Typically, patients would take the orally administered drug daily, but Alkermes has developed Risperdal Consta, an injectable that needs to be taken only twice a month.

Now, Alkermes does, in fact, have two drugs most likely coming up for FDA approval in the next month: Vivtrol, already on the market to treat alcoholism but awaiting a federal nod to treat heroin and opioid addiction; and Bydurion, a once-weekly injectable version of Byetta, which is Amylin Pharmaceuticals’ treatment for Type 2 diabetes. Like Risperdal, Byetta needs to be taken daily.

What are these drugs’ chances for success? And is the stock, up 56% year-to-date, still worth buying? Cramer looked to Chairman and CEO Richard Pops for answers. Watch the video for the full interview.

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