When you think of the word "biotech," Biogen (BIIB -1.09%) may be one of the first companies to come to mind. The biotech giant has grown annual profit more than 200% to more than $4 billion over the past decade. And it sells four blockbuster drugs including multiple sclerosis (MS) treatment Tecfidera. If you bought Biogen shares a decade ago, your investment has more than tripled in value.

But if you haven't yet bought shares of Biogen, you may be wondering if this big biotech's story is over. Revenue and profit are on the decline. And the shares have fallen from an all-time high reached in 2015. Let's take a look at three things to consider before you decide whether to buy Biogen stock -- or keep it on your watch list.

The letters "FDA" are pictured against bright green grass.

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1. A transformative decision on the horizon

Biogen's immediate future -- when it comes to revenue and stock price -- is in the hands of the U.S. Food and Drug Administration (FDA). The regulatory agency is considering aducanumab, Biogen's investigational Alzheimer's drug.

The potential product could be transformative for patients. That's because it would be the first to reduce decline in cognition and daily function. And that would make aducanumab transformative for Biogen's revenue. The potential treatment could generate more than $4.9 billion in 2026 sales, according to EvaluatePharma.

This sounds great. But there's one big risk. And that's the risk the FDA won't approve aducanumab. Biogen surprised investors when it ended the drug candidate's development early in 2019, then revived it several months later. The company said a look at a broader clinical trial data set showed efficacy. But not everyone is convinced -- including an FDA advisory panel. The committee in November voted against approving aducanumab.

The FDA, however, early this year extended the drug candidate's review period to June 7. And that sparked investor optimism. It's clear an FDA approval would result in a major stock price gain -- and a brilliant future for Biogen. But a negative decision could be disastrous for the shares. At least in the short term.

2. The decline of blockbusters

Meanwhile, sales of Biogen's biggest blockbuster, Tecfidera, are falling. And the company predicts the situation will worsen. That's because generic competitors are entering the market. In fact, Biogen predicts "a sharp decline" in Tecfidera's U.S. sales in the first half. Biogen also expects "significant erosion" of Rituxan sales in the U.S. The biotech collaborates with Roche's Genentech on the treatment for autoimmune diseases.

These declines are bad news. But they're also a normal part of the biotech and pharmaceutical business. If the FDA approves aducanumab and/or other pipeline programs produce successful drugs, Biogen can compensate for the lost revenue. Vumerity, Biogen's newest MS drug, also may play a positive role. Biogen launched the drug in November 2019 with the idea Tecfidera patients could transfer over to it. This movement has been slow. But the pandemic may have been a factor. Vumerity sales will be a point to watch as the coronavirus crisis eases and patients return to doctors more regularly.

A researcher in a lab looks into a microscope.

Image source: Getty Images.

3. Programs and partnerships

New programs and partnerships may result in a new wave of revenue growth down the road. Biogen advanced 12 new programs through trials last year in treatment areas such as MS, Parkinson's disease, and depression. And six of Biogen's pipeline candidates are in phase 3 studies.

Biogen also is increasing its chances for success through collaboration. It gained co-development and co-commercialization rights to a Denali Therapeutics Parkinson's disease program. The companies expect late-stage trials for a candidate to begin this year. Biogen and Sage Therapeutics are co-developing in the U.S. zuranolone for depression disorders and SAGE-324 for neurological disorders. Biogen also is collaborating with ViGeneron on gene therapy for eye diseases.

So, what do these points mean for investors?

In the near term, the FDA's aducanumab decision will be critical -- for earnings and the share price. Buying (or not buying) the stock today is a bet on that decision. And that's best left to aggressive investors.

Beyond that point, Biogen shares will settle at their higher or lower level -- depending on the FDA decision. And then, it will be important to consider Vumerity sales and progress on late-stage pipeline programs and collaborations. If these elements start looking bright, Biogen's future also will brighten. And that will make it easier for the rest of us to consider the shares.