The popular TV host has shied away from Lilly in the past because of the company's huge number of patent expirations in coming years. With over $10.5 billion a year in sales coming off patent, Cramer said there was a lot to be concerned with. However, those facts are now priced into the stock and with the company's recent acquisition of ImClone, Lilly's future is looking up, he said.
Cramer is excited about Lilly's pipeline, which is supposed to have 10 new drugs in phase three testing by 2011. Between 2009 and 2012, Lilly expects one major new drug offering a year.
Cramer said Lilly also is in a strong cash position, with $3.4 billion on its balance sheet and no-long term debt coming due until 2012.
Lilly, based in Indianapolis, gained 76 cents, or 2 percent, to $38.10 in after-hours trading yesterday. It was up 36 cents today in late-morning trading.