Shares of drug maker Alexion Pharmaceuticals (ALXN) have been under distribution since October as investors question whether the company can be more than just a “one-hit” wonder.

Despite a 22% pullback since hitting a high of $119 in October, the stock still sells at a premium valuation of 82 times trailing earnings and 38 times forward earnings. The valuation isn’t crazy due to strong growth in recent quarters and decent growth prospects, but its recent price action tells me that Wall Street is clearly concerned about how long strong growth will continue.

The company’s flagship drug is Soliris, used to treat paroxysmal nocturnal hemoglobinuria (PNH), a rare disease in which the body destroys its own red blood cells. The drug was also recently approved to treat a rare kidney ailment called atypical hemolytic uremic syndrome (aHUS). Soliris carries a high price tag of more than $400,000 per patient per year.

It’s never easy betting against a company with an outstanding track record of execution like Alexion but buying demand has clearly dried up. Since the market lows in mid-November, Alexion has tried to rally but notice that higher-volume declines have a decided edge over higher-volume gains. And it’s been meeting with repeated resistance at its 200-day simple moving average (SMA) — also a troubling sign.

A wave of institutional selling hit the stock over four sessions from October 19 to October 24. Alexion reported earnings on October 24. Even though sales growth decelerated sequentially, the results were still solid with profit up 62% from a year ago to $0.60 a share. Sales rose 44% to $294.1 million. Growth prospects remain strong with full-year profit seen rising 49% this year and 37% in 2013.

Remember, the goal is to always swim with the market tide whether it’s on the long side or short side. Shares of Alexion remain under distribution and its chart is bearish which makes it a short candidate. A market rally could see Alexion re-test its 40-week moving average around $98, an area that’s been a significant resistance level for several weeks. If it meets with resistance again, it’s a good short. Shorting at its current level around $92 is riskier but could still work if the market heads lower from here and institutional selling continues in the stock. Use a stop of 4%-5% above your sell price.