Amgen Inc. (NASDAQ:AMGN) and Pfizer Inc. (NYSE:PFE) were once partners. The two companies jointly marketed autoimmune-disease drug Enbrel in North America. That partnership dissolved in 2012, with Amgen continuing to sell Enbrel in the U.S. and Pfizer marketing the drug in the rest of the world.

Since the two drugmakers parted ways, Amgen has been the bigger winner by far in terms of stock performance. But so far in 2018, Pfizer has had the upper hand. Which of these two stocks is the better pick for investors now? Here's how Amgen and Pfizer stack up against each other.

Three scientists in a lab with one in foreground writing

Image source: Getty Images.

The case for Amgen

First, let's address the case against Amgen. Sales are falling for the biotech's older drugs, including Enbrel and Neulasta. Unfortunately, those are Amgen's top two best-selling products. The declines are definitely weighing on Amgen's revenue growth and hurting profits.  

The good news for Amgen, though, is that the company has several up-and-coming products with strong sales growth. In the third quarter, six drugs generated double-digit-percentage year-over-year sales increases. Cholesterol drug Repatha led the way, with sales jumping 35% over the prior-year period.

Prolia ranks as Amgen's biggest contributor to revenue growth, however. Sales for the blockbuster osteoporosis drug continue show solid momentum. It's followed by Xgeva, which consists of the same chemical components as Prolia but targets the promotion of bone density in cancer patients. 

Amgen's product lineup includes several other rising stars as well. Multiple myeloma drug Kyprolis continues to pick up steam. The company has high expectations for migraine drug Aimovig, which won FDA approval in May. The drug is jointly marketed by Amgen and Novartis.

Another new drug for Amgen is Parsabiv, which was launched in the first quarter of 2018 as a treatment for secondary hyperparathyroidism for patients with chronic kidney disease on hemodialysis. Sales for the drug are growing rapidly.

The biotech's strongest pipeline candidate is probably tezepelumab. Amgen and its partner, AstraZeneca, are evaluating the drug in a phase 3 study targeting treatment of asthma and in a phase 2 study for treating atopic dermatitis. Amgen also has a solid slate of biosimilars in development.

Amgen continues to generate strong cash flow, which it has used to reward shareholders through share buybacks and dividends. The company's dividend currently yields 2.82%. Amgen's dividend payout has increased by 180% over the past five years. 

The case for Pfizer

Pfizer has some strikes against it, too. The company faces declining sales for several older drugs that have lost patent exclusivity. Nerve-pain drug Lyrica will join the group in the near future. Pfizer also continues to struggle with product shortage issues with its sterile injectables business.

But there's plenty of good news for the drugmaker. The momentum for Eliquis, the anticoagulant that Pfizer co-markets with Bristol-Myers Squibb, seems unstoppable. Sales for autoimmune-disease drug Xeljanz continue to soar. Breast cancer drug Ibrance is another growing blockbuster in Pfizer's lineup.

The company also has several drugs with slower but still solid growth. Smoking-cessation product Chantix, pneumococcal vaccine Prevnar 13, and prostate cancer drug Xtandi all fall into that category.

Pfizer could enjoy even more success with its new drugs. The FDA recently approved breast cancer drug Talzenna and lung cancer drugs Vizimpro and Lorbrena. Earlier this year, Pfizer's biosimilars to Amgen's Epogen and Neupogen won U.S. regulatory approval.

Then there's the pipeline. Pfizer claims 28 programs in late-stage development. These include promising pain drug tanezumab, a hemophilia gene therapy, a new C. diff. vaccine, and more.

The company also awaits regulatory approval for several new drugs and new indications for existing drugs. These notably include transthyretin familial amyloid polyneuropathy treatment tafamidis meglumine and biosimilars to cancer drugs Avastin, Herceptin, and Rituxan.

Pfizer has historically offered one of the most attractive dividends in healthcare. That's still the case, with the dividend currently yielding 3.17%.

Better buy

Both of these drugmakers definitely face some headwinds. But I think Pfizer is in a better position to move past its problems over the next two to three years. 

The company's sterile injectables business should begin to get back on track next year. Newer drugs won't immediately offset the declining sales for older legacy products, but over the long run Pfizer will be able to deliver solid growth. 

Pfizer has the stronger pipeline and the stronger dividend. I think it's the better buy over Amgen right now. 

Keith Speights owns shares of Pfizer. The Motley Fool recommends Amgen. The Motley Fool has a disclosure policy.