Bristol-Myers Squibb (NYSE: BMY) shares are falling today after the Pharmaceutical Research and Manufacturers of America announced that effective January 1, 2009, drug-company sales representatives will no longer be allowed to give doctors free gifts or pay for restaurant meals on sales calls. This might result in BMY and other drugmakers having a tougher time selling their wares. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on BMY.

After hitting a one-year high of $32.35 last July, the stock hit a one-year low of $19.43 in June. This morning, BMY opened at $21.26. So far today the stock has hit a low of $20.71 and a high of $21.30. As of 12:20, BMY is trading at $20.86, down 64 cents (-3.0%). The chart for BMY looks neutral but improving, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bearish hedged play on this stock, I would consider a December bear-call credit spread above the $25 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 11.1% return in five months as long as BMY is below $25 at December expiration. Bristol-Myers would have to rise by more than 19% before we would start to lose money. Learn more about this type of trade here.

BMY hasn't been above $25 since January and has shown resistance around $22 recently. This trade could be risky if the company's earnings (due out on 7/24) are a positive surprise, but even if that happens, this position could be protected by resistance BMY might find at its 200 day moving average, which is currently around $24.50 and falling.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in BMY.