Public, global contract research organizations (CROs) are having a great run with stock prices soaring and their global growth story intact. The sector got additional validation Jan. 14 when “Mad Money” host Jim Cramer featured the niche. In general, star stock picker Cramer got the story straight on CROs, even though a few times he mispronounced company names. That happens, but at least he got the stock symbols right. And that is what counts. You can watch a replay of the episode here.

Here’s the story that CenterWatch has been covering since the beginning of time, or sometime around 1994:

Pharmaceutical companies are continuing to outsource their clinical trials in a greater percentage to CROs. And now many of those trials are going overseas. The handful of global CROs, including the largest (private, but formerly public Quintiles) have the infrastructure in place worldwide to handle those large trials. It isn’t an easy thing to build quickly so there is a barrier to entry.

Cramer said the sector is a good defensive play in a tough overall stock market. CROs, he said, would continue to grow because pharmaceutical companies desperately need to bring more drugs to market. And CROs can do the job much more cheaply than pharma companies that develop drugs in-house. We have always said that clinical research is hard work and Cramer made a good point that CROs do it better than pharma and biotech companies because they are doing it every day. Hard work done every day creates expertise.

Cramer’s picks? His favorite is Covance (CVD for you home gamers) because of its strength at opposite ends of the pipeline—in both preclinical and late phase. He also gave a thumbs up to Parexel with its expertise in late phase. Charles River got the Cramer nod as a pure-play preclinical company.

There’s always a bull market somewhere…