Earlier this month, George Soros and his fund filed disclosure documents with the Securities and Exchange Commission. Health care seems to be on the billionaire investor's mind. Here's a look at what he purchased and whether you should follow suit.

A bet on payment
By the third quarter when Soros made his purchase, Dendreon (Nasdaq: DNDN) already had its prostate cancer treatment, Provenge, approved and on the market. That didn't make Dendreon a riskless investment, though.

Soros bought ahead of the Centers for Medicare & Medicaid Services (CMS) meeting that reviewed the reimbursement of the drug. The panel voted essentially in favor of an approval, although the final decision is in CMS' hands.

Given the age of men who typically get late-stage prostate cancer, Dendreon really needs Medicare to sign off on covering the treatment, at least for the indication listed on the label.

Does Soros still own Dendreon after the CMS meeting? We won't know until he files his next set of forms with the SEC. That's one of the problems with trying to follow the gurus; you're behind on both ends of the transaction.

I think Dendreon is an intriguing investment. While the chance of an overnight double is all but gone, it's also much less risky than it was just a few months ago.

Specialty pharma
Salix Pharmaceuticals
(Nasdaq: SLXP) is a company I knew very little about prior to noticing Soros investing. Maybe that's the best strategy for following the gurus: using them to generate your watchlist.

Specialty pharma tends to be a lower risk proposition than a development-stage drugmaker, but the chance of a quick multibagger is also all but gone. You're basically betting that the drugmaker can leverage its sales force by sticking to one specialty. In the case of Salix, the company has specialized in gastrointestinal diseases.

Salix is worth a look if you're not able to stomach the big gyrations of biotechs; maybe you'll even end up on one of its stomach drugs.

Some international flavor
Soros also bought shares of medical-device maker Mindray Medical (NYSE: MR) last quarter. The company is based in China, but its 2008 purchase of Datascope gave the company a global presence.

It's a good thing, too. Sales outside China grew by more than 20% during the first three quarters of the year while sales in China were relatively flat. Mindray trades at a pretty hefty P/E of 20, but if it can keep up that kind of growth it might be worth the pricy purchase.

Generic growth
Soros' largest increase of its existing holdings was in generic-drug maker Teva Pharmaceutical (Nasdaq: TEVA). There are plenty of opportunities for growth with the coming patent cliffs that many pharmaceutical companies face.

If you're going to purchase a generic-drug maker, Teva's the one. Since generic drugs tend to be low-margin items, Teva's large size gives it a substantial advantage over smaller generic-drug makers.

Have it all
Can't take the volatility of the individual stocks? Buy a sector ETF such as the SPDR Health Care, which Soros added during the last quarter.

While I like health care in general over the long haul, I'm not all that excited about the prospects of the SPDR Health Care. It's dominated by Johnson & Johnson (NYSE: JNJ), Pfizer (NYSE: PFE), and Merck (NYSE: MRK), whose shares make up more than a third of the total assets of the ETF.

Those three offer substantial dividends, but there's not a lot of growth left in them. Pfizer and Merck are dealing with integration issues, and Johnson & Johnson has manufacturing problems. Maybe it's a nice holding to balance out the Dendreons of the world, but I'd think twice about it being your only health-care holding.

Follow Soros?
You certainly shouldn't buy just because Soros did. Portfolio management is a balancing act, and a stock that fits well in Soros' portfolio might not be a good buy for yours.

Of the four individual companies highlighted here, Dendreon looks most intriguing to me. Assuming there are no hiccups as it ramps up manufacturing capacity, there's still room to grow.

Which one is your favorite? Let us know in the comment box below.

Pfizer is a Motley Fool Inside Value pick. Mindray Medical International is a Motley Fool Rule Breakers recommendation. Motley Fool Options has recommended a diagonal call position on Johnson & Johnson, which is a Motley Fool Income Investor recommendation. The Fool owns shares of Johnson & Johnson and Teva Pharmaceutical. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. The Fool has a disclosure policy.