2. Jazz Pharmaceuticals ( JAZZ) develops treatments for neurological and psychiatric conditions. Its chief drugs, Xyrem and Luvox, are used to treat narcolepsy and obsessive compulsive disorder. Jazz's stock has appreciated 46% in 2011, outpacing indices. Jazz has grown sales, net income and earnings per share 50%, 32% and 29% annually, on average, since 2008. Its stock delivered annualized gains of 40% over that span. Still, 2010 was the first year of net profitability. Three researchers rank Jazz's shares "buy" and three rate them "hold." The company's fourth-quarter adjusted earnings more than doubled to 58 cents, missing analysts' consensus estimate by 3%. Sales, up 39% to $54 million, beat consensus by 2.6%. The performance was helped by 47% net sales growth for Xyrem, with 36% sales growth for Xyrem oral solution. Management forecasts $232 to $245 million of net sales in 2011, with a gross profit margin over 90% and $2.70 to $2.90 of adjusted earnings. Jazz's balance sheet has improved over the past 12 months. Jazz has $45 million of cash and $40 million of debt, for a net liquidity position.