Biogen (BIIB) has long been a staple of biotechnology portfolios. It has had about a dozen drugs with commercial sales of late. A share bought in 2010 for $50 was worth $256.76 at the close of market on October 26, 2020, not a bad haul over a decade. At the same time, uncertainty prevails. The stock rallied to above $400 levels in 2015.

The uncertainty is a result of two opposing forces. The negative force is certain Biogen therapies have had their patents expire and are up against cheaper generic or biosimilar competition. The positive force is the pipeline, but there is considerable uncertainty there. The main uncertainty is from a potential Alzheimer's therapy that produced ambiguous Phase 3 trial results.

To me it appears that the stock price is going on the assumption that aducanumab, the Alzheimer's therapy, will not get approved by the FDA. I do not think that is a good assumption. In addition, while other potential new drug approvals are further down the road and subject to trial results, I think even without an aducanumab approval Biogen will generate significant new revenue over the next five to ten years.

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