AbbVie (NYSE:ABBV) and Biogen (NASDAQ:BIIB) are two pharma stocks that haven't performed well lately. Over the last 12 months, AbbVie's shares are down by 2%, while Biogen's stock is down by 10%. By contrast, the pharmaceutical industry -- as measured by the SPDR S&P Pharmaceuticals Index -- is up by 14% over the same period.

However, 2020 could be very different for both companies, as AbbVie is hoping its acquisition of Allergan (NYSE:AGN) pays off, while Biogen is putting its hopes on its potential drug for Alzheimer's disease (AD), aducanumab. With that in mind, let's see which of these two companies is the better buy today. 

AbbVie isn't dead in the water yet

Humira remains AbbVie's top-selling drug. However, Humira has been facing stiff competition from biosimilars in Europe, and the international sales of the drug have declined as a result. Beyond Humira, the company can count on such products as cancer drugs Venclexta and Imbruvica, as well as Skyrizi, a medicine for moderate-to-severe plaque psoriasis.

Scientists wearing lab coat and goggles working in a lab.

Image source: Getty Images.

AbbVie's revenue growth has been crawling in recent quarters. During the third quarter, the company reported net revenue of $8.5 billion, a meager 3.5% increase year over year. Humira's net revenue was $4.9 billion, a 3.7% decrease compared to the prior-year quarter. This was because Humira's international revenue declined by 33.5% year over year.

And while sales of Imbruvica increased by 29.3% year over year, and sales of Venclexta grew by 130%, revenue from these products is unlikely to be enough to offset Humira's decreasing sales. This is precisely why AbbVie is acquiring Allergan in an all-cash transaction valued at $63 billion. Once this transaction closes -- which is expected to happen in early 2020 -- AbbVie will become a leader in the medical aesthetics market.

AbbVie CEO Richard Gonzalez said: 

With the planned acquisition of Allergan, we will be adding highly valuable on-market assets with leadership positions across additional and attractive growth segments including significant new growth platforms in medical aesthetics and CNS [Central Nervous System].

Gonzalez also touted the value of the most important asset the company will be acquiring in this transaction, namely Botox: "[B]ased on the uniqueness of this particular molecule, we have come to the conclusion that it would be extremely difficult to create a biosimilar version of Botox and I would tell you, we looked at this very extensively with a lot of outside expertise and we feel very confident that that's the case." In other words, AbbVie's future after Humira may not look so bleak after all. 

Biogen's hopes rest on aducanumab

Biogen's current top-selling product is multiple sclerosis (MS) drug Tecfidera. The company's lineup also includes MS drug Tysabri, a treatment for spinal muscular atrophy, and Flixabi, a biosimilar for rheumatoid arthritis.

Much like AbbVie, Biogen's financial results haven't been particularly impressive recently. During the third quarter, the company's revenue was $3.6 billion, a mediocre 5% increase compared to the year-ago period. Most notably, sales of Tecfidera only increased by 3% year over year. Biogen's bright spot during the quarter was Spinraza, whose sales increased by 17% compared to the prior year quarter. But Biogen's MS segment -- its largest medical segment by revenue -- continues to struggle to generate stellar top-line growth, and the company is looking elsewhere for a boost. 

That's where aducanumab comes in. Before investors place their hopes in this potential blockbuster drug for AD, though, it is essential to review its history. Biogen first announced it was abandoning the development of aducanumab in March because monthly doses of the AD drug failed to prove their efficacy in a pivotal late-stage trial. But in October, Biogen argued that a few more monthly doses of aducanumab were shown to be effective in treating AD after all, and the company decided to bring aducanumab back from the dead.

Biogen is hoping to send aducanumab to the U.S. Food and Drug Administration for approval sometime this year, and if all goes well, the company will receive approval for this potential blockbuster medicine later in the year. However, whether things will work out as planned for Biogen is far from being a foregone conclusion.

Which stock is the better buy?

Both AbbVie and Biogen are attractively valued. Biogen's forward price-to-earnings (PE) ratio is 8.87, and its price-to-earnings-to-growth (PEG) ratio is 1.72. AbbVie, with its  forward PE of 9.10 and its PEG of 2.74, is slightly less attractive.  

However, AbbVie is a more attractive dividend stock. The company currently offers a juicy 5.3% dividend yield, and AbbVie has raised its quarterly dividend payouts by 141% over the past five years. By contrast, Biogen currently does not return cash to its shareholders by way of dividends.

With that said, I think AbbVie looks like the better option right now. While the company's sales of Humira will continue to decline, Humira alone generated more revenue than Biogen's entire lineup during the last quarter ($4.9 billion versus $3.6 billion). Further, AbbVie's acquisition of Allergan will bring more diversification to its revenue stream. By contrast, Biogen's future is hanging on aducanumab, and if the FDA does not approve the AD drug, the company's shares will likely come crashing down (again), and its future will look bleak.