David Sterman

Readers of my articles know I spend little time focusing on biotech stocks. The science behind these companies is often so arcane that analyzing these firms to find the best stocks to invest in is best left to people with a serious grounding in medicine.

Even if a biotechnology company's approach is straightforward and understandable, many other factors can trip up an investor -- from disappointing clinical trials to a cash-poor balance sheet to a fickle Food & Drug Administration (FDA) advisory panel.

Yet just I've come across a biotech company that:

• Employs an easy-to-grasp approach to treating cancer tumors

• Has shown very strong clinical data thus far

• Is lining up important partners

• Has the cash to tide it over for now

• And most important, is on the cusp of a major set of milestones that could catalyze shares.

It's actually a stock I've discussed a few times before. I first discussed Celsion (Nasdaq: CLSN) roughly 10 months ago in a profile of three up-and-coming biotech stocks. Though the two other picks took off like a rocket, Celsion's shares stumbled as the months went on.

Yet in the past few quarters, this stock has really gained traction. I encourage you to read this update that I wrote in June, because it goes into greater-depth about Celsion's breakthrough ThermoDox technology, which uses heat to boost the effectiveness of tumor-treating drugs.

Shares have risen another 15% since then, but so much further upside remains that I've decided to add Celsion to my $100,000 Real-Money Portfolio. It's an unusual pick for this portfolio, as it lacks the clear downside support near current levels. But that's simply the nature of a development stage biotech: There is more risk, and a key setback could lead to sharp losses. Still, the reward here appears to outweigh the risks in a big way.

David Sterman

David Sterman has worked as an investment analyst for nearly two decades. He is currently an analyst for StreetAuthority.com