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What: With year-over-year growth for its best-selling multiple sclerosis drugs slowing and the recent discovery that its next-generation MS drug has failed a key clinical trial, it's not shocking that Biogen Inc. (NASDAQ:BIIB) shares have tumbled 22.5% this year, according to S&P Global Market Intelligence.

So What: In Q1, Biogen reported that sales of its MS drugs, including Tecfidera and Avonex, improved by 2.4% year over year and that its total sales, which includes sales from its hemophilia drugs, grew 6.7% versus last year.

Although mid-single digit growth is respectable, it marks a dramatic slowing from the year-over-year growth the company delivered in 2013 and 2014 after the FDA approved Tecfidera, the company's oral MS therapy.

BIIB Revenue (Quarterly YoY Growth) Chart

BIIB Revenue (Quarterly YoY Growth) data by YCharts

In Q1, Tecfidera sales did grow 15% to $946 million versus the same quarter in 2015, however, some of that growth came at the expense of Biogen's Avonex, a common, prior generation MS therapy. Avonex sales fell to $564 million in Q1 from $637 million a year ago.

Biogen's MS sales were also dragged down by increasing competition from oral MS therapies sold by Novartis (NYSE:NVS) and Sanofi (NASDAQ:SNY). Sales of Novartis' Gilenya increased 12% year over year to $698 million in Q1 and sales of Sanofi's Aubagio grew 64% year over year to $312 million last quarter, at current exchange rates.

Slowing sales growth already had investors nervous about Biogen's future, but earlier this month management reported that its once-promising next-generation MS drug, opicinumab, failed in a mid-stage study and that led to even more investors selling their shares.

BIIB Chart

BIIB data by YCharts

Opicinumab was being studied as a first-to-market therapy to stop and potentially reverse MS disease progression, but unfortunately, opicinumab didn't significantly improve physical function, cognitive function, and disability in MS patients, nor did it slow MS' disease progression, in phase 2 trials.

Now What: The MS market is worth $19 billion and Biogen remains the dominant player in the indication with a 38% market share. However, Biogen's market share could slide if doctors continue to switch patients to competing therapies like Gilenya and Aubagio.

In an attempt to limit that risk, Biogen has won FDA approval for MS therapies that work similarly to Avonex, but require fewer monthly doses. That effort may sure up the company's market share, but it's unlikely to return the company to double-digit top line growth.

Opicinumab could have done that, but now that its failed in phase 2, it's future development is uncertain at best. Another drug in Biogen's pipeline, aducanumab, could be a needle-mover, but it targets Alzheimer's disease, a notoriously tough-to-treat disease with a 99% clinical trial failure rate.

Biogen's slowing sales and pipeline uncertainty suggests that investors are right to approach Biogen cautiously, however, investors may not want to give up on Biogen altogether. Biogen remains handsomely profitable and it's balance sheet is one of the best in biotech. If management leverages the company's financial flexibility to bulk-up its drug pipeline, perhaps through mergers and acquisitions, then this year may only be a pause in the company's long-term growth, rather than an indication of things to come. 

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.