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It seems little more than a memory now, but for a moment earlier this year, biotech stocks were cooler than even those swinging tech stocks like

JDS Uniphase

(JDSU)

.

Investors were filled with the kind of hope and promise that the biotech companies themselves live on each day. Even people who knew little about what the companies do (read momentum investors) jumped onboard. So

Immunex

(IMNX)

soared 294% from late October to early March, while

Genentech

(DNA)

added a more modest 196%. Even lesser-known companies like

Millennium Pharmaceuticals

(MLNM)

ran along with the big dogs. It was up 279%. The

Nasdaq Biotech Index

was up 166%.

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Biotechs Stumble
The big biotech rally ended as quickly as it began.

And then, just like that, it all came apart.

Fingers were pointed at

President Clinton

and British Prime Minister

Tony Blair

because in mid-March, they seemed to back free access to genetic data that genomic companies wanted to sell. At the same time, some reality set in as worries replaced hope about drugs in the biotech pipeline.

Millennium, for instance, is 60% off its early March high. The Nasdaq Biotech Index has fallen more than 40% since then.

Now, investors are back to looking for biotechs with real promise, not just hope.

Amgen

(AMGN) - Get Amgen Inc. Report

, widely considered a solid biotech, is off 13% since early March, possibly indicating that investors are beginning to be more particular.

Just What the Doctor Ordered

But as the biotechs dropped, in fact, as the tech sector fell, the drug stocks climbed, thanks to investors looking for companies with fat, predictable earnings.

Their gains were driven in part by the expectation and delivery of mostly double-digit first-quarter earnings for companies including

American Home

(AHP)

,

Pfizer

(PFE) - Get Pfizer Inc. Report

,

Johnson & Johnson

(JNJ) - Get Johnson & Johnson Report

and

Eli Lilly

(LLY) - Get Eli Lilly and Company Report

.

Since biotechs started heading down in early March, American Home is up about 26%, Pfizer has gained roughly 33%, Johnson & Johnson is up about 17% and Lilly has climbed about 32%.

But investors aren't buying just any drug stock, as they seemed to do with the biotechs. A regulatory setback Wednesday from

Bristol-Myers Squibb

(BMY) - Get Bristol-Myers Squibb Company Report

, involving its potential blockbuster hypertension drug

Vanlev

, sent its shares down 15, to 50 1/8, or 23%. It closed Thursday at 50.

There's also the specter of government price controls as Congress seeks to stem the rise in drug prices for the elderly. But for now, there is much more enthusiasm for hot-selling drugs.

The soon-to-be wed Pfizer and

Warner-Lambert

(WLA)

, for instance, were awash in investor enthusiasm, thanks mainly to the success of

Lipitor

, the blockbuster lipid-lowering drug they sell. Pfizer's first quarter earnings grew 33%, while Warner's climbed 35%.