Biogen (BIIB -0.92%) investors got some great news last week when the U.S. Food and Drug Administration (FDA) approved the company's Alzheimer's drug, Aduhelm. Shares of the volatile stock soared as much as 64% on the day of the announcement, reaching a new 52-week high of $468.55. Investors have been busy buying up the stock in droves; meanwhile, analysts have also been upgrading the stock, setting higher price targets based on the news.

But amid all this excitement, there remains a lot of controversy. Many people are convinced the approval was the wrong decision, and some who were part of the FDA's advisory panel have even quit over it. Investors should be careful with Biogen, especially given its inflated price, as the FDA's approval comes with a caveat. Specifically, there are three words in that approval that suggest the soap opera involving Aduhelm still isn't over:

"Accelerated approval pathway"

In the FDA's press release announcing the approval of Aduhelm, the agency stated that the approval was reached under an accelerated approval pathway. This means the agency has determined that the drug is "reasonably likely to predict a clinical benefit to patients," but there another trial is necessary to confirm and verify that. That could be problematic for a drug that didn't exactly win everyone over with its results.

Scientists working in a lab.

Image source: Getty Images.

Back in November, shares of Biogen skyrocketed when the FDA called the company's drug trials "highly persuasive" and hinted that approval may be inevitable given its effectiveness. But just days later, the stock collapsed when a panel that advises the FDA stated the opposite: It wasn't convinced the drug was effective in slowing down the progression of Alzheimer's.

This month's decision has been so controversial that three members of the FDA's advisory panel have quit over it. One of them was a professor at Harvard Medical School, Dr. Aaron Kesselheim. According to CNBC, which obtained his resignation letter, he referred to the Biogen decision as "probably the worst drug approval decision in recent U.S. history." A dementia expert, Dr. Jason Karlawish, also told the website that "the evidence to approve the drug wasn't sufficient."

Although the FDA stands by its approval, it's clear that the future remains hazy for the company and its stock. The agency can withdraw the approval if the subsequent trial "fails to verify clinical benefit."

Why investors should be worried

Another study could certainly alleviate the risks surrounding Aduhelm. However, that's anything but a guarantee. Just like with any healthcare stock that lives and dies by a clinical trial, there's significant risk here. While analysts have been cheering, setting price targets as high as $500 for Biogen, those rosy outlooks could change quickly if another trial doesn't put critics' fears to rest.

These are some incredibly smart and qualified people disagreeing with the FDA's decision, and investors should be careful not to dismiss them. While many families would love for the drug to work, especially since this is the first Alzheimer's treatment in 18 years to obtain approval, at a price of $56,000 per year the medication isn't cheap -- even if insurers pick up a significant chunk of the tab. That means there's a lot at stake both professionally and ethically to make sure the decision the FDA reaches is the correct one.

If the agency backtracks on the decision, it would be problematic for Biogen. Last year, a court invalidated its patent on Tecfidera, its top-selling multiple sclerosis drug, putting even more pressure on Aduhelm to succeed. For the three-month period ending March 31, the company's product sales of $2.2 billion were down 24% from the prior-year period. Revenue from its multiple sclerosis drugs of $1.5 billion was a key reason for the decline, drip by 30%. Biogen blamed that on a decline in demand as well as higher discounts due to generics. And as competition intensifies, the company's sales could take more of a hit.  In short, Biogen needs Aduhelm to help grow its business.

Should you sell Biogen stock?

There are too many questions surrounding Biogen's future to make this a safe investment to be holding right now. While it does have other drugs in its pipeline, including six that are in phase 3 trials, much of the hope for the company has been tied to the success of Aduhelm given its potential to reach Alzheimer's patients who badly need better solutions. And with some analysts projecting the global Alzheimer's disease market to be worth $25 billion by 2027 -- growing at a compound annual rate of 17.5% until then -- it's easy to see why the approval of Aduhelm was so important for Biogen and got investors rallying around the stock.

Unfortunately, with another trial still necessary -- one that could potentially take several months -- this is going to remain a very volatile stock. And given the strong opposition to the drug's approval from some very qualified individuals, I would be hesitant to bet on its success. For investors, there are simply far better growth stocks out there to choose from; there's no need to risk your money on Biogen.