Jim Cramer's Mad Dash: The Fed Is Overlooking Biotech Growth

NEW YORK (TheStreet) -- Shares of Intercept Pharmaceuticals (ICPT) are up over 30%, but are off yesterday’s after-hours highs when the stock soared 66% on a positive earnings report. 

On CNBC’s "Cramer’s Mad Dash" segment, TheStreet’s Jim Cramer, co-manager of the Action Alerts PLUS portfolio, reminded investors that Federal Reserve chair Janet Yellen recent called small-cap and mid-cap biotech stocks overvalued. 

However, Intercept appears to have a cure for nonalcoholic steatohepatitis, a form of liver disease. 

The preliminary results are better than many had expected, Cramer said. 

“When you have a great orphan drug that does do something special, you can have this kind of move,” he added, referring to the jump in the stock price. 

Large-cap pharmaceutical companies aren't the ones generating growth; biotech companies are. The Federal Reserve was "misplaced" calling the industry overvalued, Cramer concluded.

-- Written by Bret Kenwell in Petoskey, Mich.

Follow @BretKenwell

At the time of publication, Cramer's Action Alerts PLUS had no position in companies mentioned.

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