Investors who bought Biogen (BIIB 2.17%) shares five years ago and held on to them would have received a return of more than 130%. Those who bought and held Gilead Sciences (GILD -0.85%) stock for the period would have nearly tripled their initial investment. But it's Biogen's stock that is enjoying more success these days. Which of these big biotechs is now the better buy?

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The case for Biogen

Biogen's past success stemmed from its multiple sclerosis (MS) franchise. And the biotech remains a leader in the MS market. Lead drug Tecfidera is still going strong, with 10% year-over-year sales growth in the third quarter of 2016. However, Tysabri saw only single-digit percentage growth during the quarter -- and sales are dropping overall for Biogen's interferon products.

There's now a new growth driver for Biogen, though. Biogen won U.S. regulatory approval for spinal muscular atrophy (SMA) drug Spinraza in December. The drug was granted accelerated approval status in Europe and also awaits approval in in Japan, Canada, and Australia.

Wall Street expects Spinraza to reach peak annual sales of around $1.7 billion by 2025. Biogen must pay Ionis Pharmaceuticals, the developer of Spinraza, tiered royalties up to a percentage in the mid-teens. Even with giving Ionis its share of revenue, the drug could help Biogen's earnings grow significantly over the next few years.

The biotech will need the help from Spinraza. It's likely that an MS drug that Biogen licensed to Roche, Ocrevus, could put a dent in overall sales for Biogen's MS franchise. Although Biogen stands to receive royalties on any sales of Ocrevus if it is approved, the drug will probably take market share from Tysabri, in particular. 

Biogen's pipeline, though, is certainly one that investors should like. The company has two late-stage clinical programs. One of them is evaluating Gazyva in treating non-Hodgkin's lymphoma. Gazyva is already approved for treating follicular lymphoma but, like Ocrevus, is licensed to Roche. 

The other late-stage program, however, has the potential to be a game changer for Biogen. Experimental Alzheimer's disease drug aducanumab is being evaluated in two phase 3 studies. The monoclonal antibody has been granted granted Fast Track designation by the U.S. Food and Drug Administration (FDA), which could allow Biogen to move more quickly in the regulatory approval process. 

Biogen also has a rich mid-stage pipeline with nine programs. One of these, opicinumab, could give the company another addition to its MS franchise in the future. Two of the mid-stage clinical studies are evaluating other experimental Alzheimer's treatments. Biogen is also researching therapies for other indications, including lupus.

The case for Gilead Sciences

Gilead Sciences' early success came from its HIV program. The biotech still is a leader in HIV, with blockbuster drugs Truvada, Atripla, Stribild, and Complera/Eviplera. Gilead also has newer HIV drugs that are performing very well -- Genvoya, Descovey, and Odefsey.

Over the past few years, though, Gilead's incredible growth came from its hepatitis C virus (HCV) franchise. First Sovaldi, then Harvoni, skyrocketed to huge sales. Now, Gilead's latest HCV drug, Epclusa, is enjoying tremendous success. 

However, Gilead's HCV success came at a cost. Its drugs cured so many patients that newer patients are harder to find than they were a couple of years ago. Gilead also faces more competition now. This has resulted in the big biotech's stock nosediving around 20% over the last 12 months.

There's still a solid investment case for Gilead Sciences, though. The biotech's pipeline includes 10 late-stage programs and 15 mid-stage programs. Gilead is looking to continue its dominance in the HIV market while also expanding into new indications. Of particular note is the biotech's focus on non-alcoholic steatohepatitis (NASH). Gilead has three experimental drugs targeting treatment of NASH, a disease that has been dubbed the "next hepatitis C" by some because of its market potential.

Gilead also is setting its sights on expanding its oncology portfolio. The biotech hopes to win another approved indication for Zydelig in treating relapsed/refractory chronic lymphocytic leukemia (CLL). Gilead also has two other late-stage experimental cancer drugs, momelotinib and GS-5745. Perhaps more importantly, Gilead has hinted about spending some of its $31.6 billion cash stockpile (including cash, cash equivalents, and marketable securities) on acquisitions to beef up its oncology program. 

That huge cash position, combined with continued strong cash flow from its HIV and HCV franchises, has allowed Gilead to buy back shares at a frantic pace. The company also pays a solid -- and growing -- dividend.

Better buy

I really like both of these biotech stocks. Biogen should see major success with Spinraza. It's possible that Biogen will become a leader in treating Alheimer's disease in the next few years. However, I think Gilead Sciences is the better buy for long-term investors.

Gilead's stock is ridiculously cheap right now, trading at less than seven times earnings. I expect the company to make some smart acquisitions this year -- plus continue to reward shareholders with more buybacks and higher dividends. In addition, my view is that Gilead will emerge as one of a handful of leaders in the big NASH market.

Biogen's stock is on more of a roll now, but I think Gilead Sciences is poised for a major rebound.