One market leader that hasn't been doing well lately is Johnson & Johnson. The stock's been in a pronounced downtrend since May of 2005. This is a bit of a red flag because Johnson & Johnson is a powerhouse in healthcare and pharmaceutical-related consumer products.

If you happened to be a large-cap investor, it might be worth keeping an eye on this stock. Like all companies, they experience up cycles and down cycles and a good entry point may present itself for investors sometime this year. Johnson & Johnson is a well-managed company with a distinguished track record of wealth creation.

While we're on the subject of pharmaceuticals, I always find it useful to look at an industry and look for ways to invest in it with less risk. The pharmaceutical/biotechnology business is a risky one and many small-companies have failed trying to bring a new drug to the market. This is why the landscape is populated with so many large-cap companies in this industry--they are the only ones who can afford to develop new drugs on a consistent basis.

One interesting company that I recently came across is called Phase Forward Inc. (NASDAQ/PFWD). This is a small-cap technology company that sells software and related services to the pharmaceutical and biotechnology industry. Headquartered in Waltham, MA, the company's software is used to manage data that is derived from pharmaceutical clinical trials. The company's goal is to ensure that clinical trials are safe and that the data generated from these trials is accurate and reported in a consistent manner.

In my view, this company is a great way to play the high-risk drug development business. Revenues for the 2005 fourth quarter grew 18% to $23.6 million, up from $20.1 million in the fourth quarter of 2004. Net income applicable to common stockholders for the fourth quarter of 2005 was $6.4 million, or $0.18 per diluted share, compared to $734,000, or $0.02 per share. The most recent quarter included a benefit of $4.5 million, or $0.13 per share.

The company has lots of cash, a solid backlog, and wins awards for its products on a consistent basis.

If you ever want to invest in a particular industry, but are uncomfortable doing so, consider the "alternative angle." In this case, a technology company that serves the pharmaceutical industry is achieving success, without the inherent risk associated with developing new drugs. A few "alternative angle" stocks in your portfolio can bring the right kind of diversity to your holdings.