Image source: Getty Images.

Developing game-changing treatments isn't easy. Often drug developers fall short in their efforts and when they do, investors can overreact and send shares plummeting lower. But just because shares have fallen doesn't mean that investors should be buying. For example, these three drug developers have all seen their shares fall sharply in the past week, but I think only one of them is a bargain that's worth buying.

Image source: Immunomedics.

No. 1: Immunomedics, Inc. (NASDAQ:IMMU)

There's no bigger stage for a clinical-stage cancer-drug developer than the American Society of Clinical Oncology (ASCO) conference. Because ASCO's annual get-together can put small-cap biotech stocks on the map, investors were excited to learn earlier this year that Immunomedics' therapy for triple-negative breast cancer, sacituzumab govitecan, was selected for an oral presentation.

Investors who bought shares in Immunomedics ahead of that presentation last weekend hoping for a pop, however, were dealt a disappointing blow on Friday: Management announced that ASCO had canceled the company's presentation, because it determined that Immunomedics had previously disclosed the data it was planning to unveil -- a violation of ASCO's strict embargo rules.

Investor disappointment was fueled even further when management reported earlier this week that sacituzumab's efficacy in relapsing small cell lung cancer (SCLC) was less than industry-watchers were hoping.

This one-two punch significantly dented the company's share price, but investors may find a silver lining in the fact that ASCO's decision wasn't based on sacituzumab's efficacy in breast cancer. Also, while sacituzumab didn't deliver a knockout blow in small cell lung cancer, the trial results may still be good enough to suggest that sacituzumab can play a role in treating heavily pretreated SCLC patients, a population with a poor prognosis and limited treatment options.

Because of those "silver linings," Immunomedics may still end up rewarding investors down the road, especially if the company makes good on plans to file for accelerated approval of sacituzumab in breast cancer. Sacituzumab has fast-track status in that indication, and if the FDA accepts an application for accelerated approval, a decision could come within six months of the company's filing.

Nevertheless, it's far from a lock that regulators will grant sacituzumab a go-ahead anytime soon, and that makes this stock too risky for me to want to tuck it into my portfolio.

No. 2: Valeant Pharmaceuticals (NYSE:BHC)

Valeant investors have endured more than their fair share of disappointment in the past year, so they may not have been too surprised when Valeant's management announced disappointing first-quarter financials that caused the company to reduce its full-year profit outlook (yet again!).

The company's new CEO Joe Papa is dealing with a seemingly endless to-do list left to him by his predecessor, and because the company's 20-year distribution deal with Walgreens Boots Alliance (NASDAQ:WBA) is off to a rocky start, that list appears to be getting even longer.

Last quarter, problems associated with filling prescriptions for its drugs through Walgreens and receiving adequate reimbursement from payers led to Valeant losing money on some patients. In turn, Valeant's lackluster first-quarter results led to Papa cutting the company's outlook for 2016 from already lowered guidance issued in March.

Currently, Papa thinks that Valeant can deliver sales of at least $9.9 billion and non-GAAP (generally accepted accounting principles) earnings per share of at least $6.60, but previously management had been hoping for sales and non-GAAP EPS of at least $11 billion and $8.50.

The disappointing full-year forecast adds uncertainty to an already uncertain company, and while it may be tempting to think that Valeant Pharmaceuticals shares are in the bargain bin, investors ought to remain cautious. So far, buying bad news in this stock has not been profit-friendly, and until the company demonstrates its struggles are truly behind it, I'm content to focus on other investment ideas.

Image source: Biogen Inc.

No. 3: Biogen Inc. (NASDAQ:BIIB)

Biogen racks up billions of dollars in sales every year from medicine that delays the progression of multiple sclerosis, but a moon-shot new drug that could have changed patient treatment forever has flamed out and shares have fallen sharply this week.

Biogen reported on May 7 that its once-promising anti-LINGO-1, or opicinumab, failed to deliver the goods in a phase 2 study. That study was attempting to show that opicinumab can reverse the course of this disease by repairing the damaged myelin that slows cell signaling and causes MS.

Unfortunately, opicinumab failed to improve patient outcomes in this trial, and that's casting substantial uncertainty on the drug's future. Given that opicinumab's success could have translated into billions of dollars in future revenue, investors aren't wrong to be disappointed.

However, selling Biogen on opicinumab's news may not be the best bet. Despite the setback, Biogen remains the market-share leader in multiple sclerosis, and it is launching new treatments that improve patient dosing and lead to lower patient burden, boosting sales and profit.

Additionally, Biogen has plenty of other irons in the fire that could pay off for investors, including three drugs that are in mid- and late-stage trials for Alzheimer's disease. The most advanced of these drugs is aducanumab, which is in phase 3 trials to determine if it can delay Alzheimer's disease by reducing the buildup of amyloid plaques that are thought to impair memory and mental function.

Since Alzheimer's disease is a major cause of death with limited treatment options, revenue from drugs targeting this indication, such as aducanumab, could dwarf what opicinumab might have brought in if it had succeeded. However, it could be years before we find out if Biogen's Alzheimer's disease trials pan out.

Overall, Biogen's deep pockets mean it has the financial flexibility to investigate game-changing medicines like these, and a few stumbles along the way are to be expected. Despite the setback, the company still has a strong grappling hold on MS market share, and following this drop, its shares are arguably a value at less than 13 times next year's EPS estimates. For those reasons, Biogen is the one company of these three that I think long-term investors ought to consider buying.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.