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.

More from Opinion

3 Warren Buffett Stock Picks That Could Be Perfect for Your Retirement Portfolio

3 Warren Buffett Stock Picks That Could Be Perfect for Your Retirement Portfolio

50 Stocks That Could Be Shredded If a U.S. Trade War With China Ignites

50 Stocks That Could Be Shredded If a U.S. Trade War With China Ignites

Tuesday Turnaround in Politics: Is a Trade War on the Horizon?

Tuesday Turnaround in Politics: Is a Trade War on the Horizon?

Many Chip Stocks Look Cheap Here, as Long as the Economy Holds Up

Many Chip Stocks Look Cheap Here, as Long as the Economy Holds Up

Apple Buys Tesla? Amazon Buys Sears? 3 Dream Mergers That Just Make Sense

Apple Buys Tesla? Amazon Buys Sears? 3 Dream Mergers That Just Make Sense