By Stockpickr Guest Columnist Susanne Owen

Everyone is hurting and cashing out and leaving the market. People are saying that it's impossible to pick single stocks and we shouldn't even try. Bottom line: No bull markets anywhere.

So it is this Trading Nymph's challenge to find five names that actually could work, even if it turns out that we have much further to go in this bear market. These defensive names are companies whose products consumers buy no matter how bad the economy is.

First on the list is The Medicines Co. (MDCO), a pharmaceutical company that focuses on the treatment of critical-care patients by cost-effective medicines.

Its drug Angiomax is used as an anticoagulant in combination with aspirin in patients undergoing coronary angioplasty. Cleviprex is an injectable drug intended for the reduction and control of blood pressure in intensive-care patients who cannot take oral medications. It's the first nonpill drug to receive approval for high blood pressure in 10 years. In The Medicines Co.'s July conference call, it indicated that Cleviprex would add $5 million to $10 million in sales. The company also has a drug named cangrelor under development, for which it is hoping for an NDA submission in 2009 as an intravenous antiplatelet agent that prevents platelet activation and aggregation.

What is interesting about The Medicines Co., besides the fact that it has no debt and $238 million in cash, or $4.57 per share, is that legislation is in the works that could greatly benefit the company. In 2001, it failed to file a patent term extension application for Angiomax within the 60-day time limit, missing the deadline by one day. Since that time, there have been efforts to remedy the situation with a bill many call the "Dog Ate My Homework Act," which passed the House of Representatives on June 23 and has moved to the Senate for consideration. If this bill is passed, it could extend Angiomax's patent by four years to December 2014. The stakes for The Medicines Company are huge. The company expects Angiomax to generate more than $500 million in sales in the U.S. by 2010.

Per its July conference call, net revenues were up 54% to $86.7 million, and U.S. sales were up 53%. It had a 14% upside surprise and $40.87 million in cash flow. It also indicated that Angiomax may be a promising substitute for Baxter's (BAX) standard blood thinner heparin, which has been having some "issues."

On a technical picture, Medicines is trading just below its 50-day moving average and way above its 200-day moving average, with support around it's Oct. 6 close.

Next, I give you another heart play, Thoratec (THOR), which manufactures devices to keep the heart pumping in cases of advanced-stage heart failure. The company's product lines include the ventricular assist device HeartMate, with more than 11,000 devices implanted in patients suffering from heart failure.

In May, Thoratec blew past earnings expectations in the second quarter and raised its 2008 forecasts, with a 122% upside surprise. Already used in Europe, the company's HeartMate II received government approval in April for use in the U.S. HeartMate II is used for patients awaiting heart transplants and is approved only as a temporary treatment.

Technically, Thoratec is at its 50-day moving average and way above its 200-day moving average, with support around $24. It recently announced that on Oct. 1, the market price conversion condition for its senior subordinated convertible notes due 2034 would be satisfied.

If this market is giving you a headache and you can't even afford the brand-name aspirin anymore, I give you Perrigo (PRGO). The stock is over its 50-day and 200-day moving averages, with support at $37 and resistance at $39.68.

Have you ever gone to your local drug store to grab NyQuil and found next to it a bottle called Night Time that looks about the same but is a lot cheaper? Or reached for Centrum Vitamins only to find Century Vitamins, looking like its twin brother? Well, those are Perrigo's "private-label" versions of the popular brands, and in this economy, people are grabbing for savings where they can find them.

Perrigo also has a generic prescription unit. Per the August conference call, the CEO indicated that it had a great year with record sales, record earnings and record cash flow. Perrigo trades with a PEG of about 0.9 and a forward P/E of about 16. On the technical side, on Monday it did break down under its 50-day moving average, but it has support on its Sept. 15 levels. I would be concern only if it fell below that level.

Still sore? Chattem (CHTT) is well over its 50- and 200-day moving averages. The maker of Gold Bond, Cortizone-10, Aspercreme, Unisom, Capacitate, Selsun Blue, Dexatrim and a lot of other stuff you find in friendly local drug store reported on Sept. 25, raising 2008 profit guidance and offering 2009 outlook ahead of analysts' estimates.

The company has indicated that it does not suffer from recessionary pressure and that falling oil prices could benefit its raw and freight costs. It also indicated that private labels such as Perrigo are not a threat. In an Oct. 6 interview with Jim Cramer on CNBC's "Mad Money" show, CEO Zan Guerry said that last week was the company's strongest in sales at Wal-Mart (WMT) this year, which should be good for its next quarter. Cramer noted that Chattem recently pushed through a 5.4% price increase to further bolster its bottom line. With 65% of the company's sales coming from its six top brands, all of which are No. 1 in their categories, Cramer called Chattem one of the ultimate safety stocks.


Finally, Church & Dwight (CHD) is still above its 50-day and 200-day moving averages. The maker of Aim toothpaste, Arm & Hammer baking soda, cat litter, Trojan condoms and more has had upside earnings surprises in its last four quarters. In its last conference call, management stated that no other consumer packages company was as "well-suited to handle a recession as Church & Dwight" and that more than 30% of the company's domestic portfolio consists of value-oriented products, and it also benefits from lower oil prices.

In the second quarter of 2008, the company experienced 8% organic revenue growth, 110 basis points of gross margin expansion, a 13% increase in net income and an 82% increase in cash flow.

I keep track of these five stocks in a Stockpickr portfolio called Nurse Nymph Looks for Medical Plays in This Sick Economy. I think these names can help keep you clean and healthy and your heart beating strongly during this selloff.

I own PRGO.

Posted on Oct. 9, 2008