Don't try to catch a falling knife.

That's good advice literally -- and figuratively when it comes to buying stocks. You never know if a plunging stock will go down a lot more. Three stocks that have certainly fallen this year are Alexion Pharmaceuticals (NASDAQ:ALXN), Valeant Pharmaceuticals (NYSE:BHC), and Vertex Pharmaceuticals (NASDAQ:VRTX). Are these stocks like falling knives -- or could they be the biggest comeback opportunities of 2017?

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Multiple miscues

Alexion's stock has fallen around 40% this year. The biotech badly missed Wall Street earnings expectations in the first quarter and followed up with another miss in the second quarter. In June, Alexion announced disappointing results from a late-stage study evaluating Soliris in treating refractory generalized myasthenia gravis, a debilitating neuromuscular disease.

More recently, Alexion had to delay filing its 10-Q report for the third quarter because of an internal investigation into allegations of improper sales practices. Just weeks after the announcement of this investigation, the company's CEO and CFO were gone. Although Alexion didn't state that these executive departures were related to the investigation, the timing raised suspicions that there was a connection.

Can Alexion recover from these issues? Probably so. The biotech still plans to move forward with submitting Soliris for regulatory approval in treating refractory generalized myasthenia gravis. Sales for Soliris are still booming, and additional indications could be on the way.

The company expects to wrap up the investigation soon. As of Dec. 12, Alexion's Audit and Finance Committee had not found any issues that would require the company to restate previous financial statements. Alexion also anticipated submitting its third-quarter 10-Q report no later than January 2017.    

Ticking debt bomb

Valeant's stock began imploding in 2015. The carnage carried over into this year, with the stock losing 85% of its value.

The drugmaker faces many challenges, but the biggest by far is its massive debt totaling more than $30 billion. Valeant went on a multiyear shopping spree, scooping up smaller companies left and right. That spending is now catching up with the company at a time when Valeant has a black eye over its pricing policies.

Valeant has made some good moves to address its public relations disaster over jacking up its drug prices. The company replaced its CEO, brought in new board members, and has a revamped executive team. Valeant cut the costs for several of its drugs and also implemented sweeping drug-pricing changes. But the debt problem remains.

The company plans to sell off non-core assets. That should allow it to pay down around $5 billion of its debt. Valeant also has a rapidly growing product in Xifaxan, plus solid potential with several pipeline candidates, particularly autoimmune disease drug brodalumab. 

Losing the expectations game

Vertex Pharmaceuticals' share price has dropped around 40% in 2016. While the company reported growing revenue and net income, it wasn't enough to satisfy Wall Street.

Cystic fibrosis drug Orkambi has driven Vertex's improved financial numbers, but also been a factor the stock's decline. Vertex reported in April that 15% of patients discontinued taking Orkambi within three months because of respiratory adverse events. That's much higher than the 5% discontinuation rate seen in clinical studies of the drug.

A few months later, Vertex revealed lower-than-expected compliance rates for Orkambi. That news bothered investors, although the company did explain that patients were not discontinuing the drug but were instead refilling their prescriptions more slowly than anticipated.

The company also experienced setbacks with other products. In February, Vertex announced that the FDA had turned down approval for Kalydeco in treating patients age 2 or older with one of 23 residual function mutations in the cystic fibrosis transmembrane conductance regulator (CFTR) gene. In August, the company canceled a late-stage study of VX-661 in combination with Kalydeco in treating cystic fibrosis patients with specific residual function mutations.

For Vertex, the key to a rebound will be for Orkambi's sales to increase as much as analysts expect. The company's efforts to improve patient compliance rates in the U.S. should help. Finalizing reimbursement with several European countries is another important component to Vertex's success.

Ready for a comeback?

Can Alexion, Valeant, and Vertex mount comebacks in 2017? It's possible.

I think Valeant will face the most difficult path. Even if the company sells its non-core assets and pays down some of its debt, there will still be a huge amount of debt remaining. Valeant's CEO, Joe Papa, has said that his company is "the turnaround opportunity of a lifetime." He could be right, but I suspect the odds of that turnaround happening next year aren't great.

Vertex could very well have a much better year in 2017. Sales for Orkambi and Kalydeco should continue to grow. A little bit of good news for Vertex could go a long way in helping the stock to bounce back.

That leaves Alexion. If the company's internal investigation doesn't reveal anything too serious, I think the biotech's stock will soar. Of these three companies, Alexion is in the best shape from a financial perspective. My hunch is that, barring any major scandals resulting from the investigation, this biotech could be one of the biggest comeback winners of 2017.