In the heathcare version of "Where the Money Is", guest Brian Orelli joins regulars Michael Douglass and David Williamson to discuss the state of the healthcare sector.

In M&A news, Endo International has made an unsolicited bid to acquire Auxilium Pharmaceuticals (UNKNOWN:AUXL.DL) for $28.10 a share in cash and stock; Auxilium's management wasn't too happy with the offer and set up a poison pill to thwart the takeover.

A couple of Alzheimer's disease drugs made headlines this week. Eli Lilly (NYSE:LLY) and AstraZeneca (NYSE:AZN) hooked up to develop early stage BACE inhibitor AZD3293, while the New York state attorney general sued Actavis (NYSE:AGN) over its plans to pull a version of an already approved Alzheimer's drug, Namenda, off the market.

In the last piece of news, American's are getting fat(ter) around the waist. No big surprise there; the big question is whether drugs to treat obesity will ever take off.

The guys wrap up with three top picks in healthcare. Michael likes Amgen (NASDAQ:AMGN) for its late-stage pipeline. Brian goes smaller, suggesting investors look at Isis Pharmaceuticals (NASDAQ:IONS) for its massive pipeline of next-generation antisense drugs. And David wraps up with his pick of Biogen Idec (NASDAQ:BIIB) for its franchise of multiple sclerosis drugs, among others.

Brian Orelli has no position in any stocks mentioned. David Williamson has no position in any stocks mentioned. Michael Douglass has no position in any stocks mentioned. The Motley Fool recommends Isis Pharmaceuticals. 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. The Motley Fool has a disclosure policy.