Amgen vs. Axsome Therapeutics: Which Healthcare Stock Is a Better Buy in 2026?

Choosing between Amgen (NASDAQ:AMGN) and Axsome Therapeutics (NASDAQ:AXSM) means weighing the established stability of a global pharmaceutical leader against the rapid growth of an emerging central nervous system specialist.

Amgen operates as a diversified biotechnology giant with products reaching patients in approximately 100 countries. Axsome Therapeutics focuses on central nervous system disorders like depression and narcolepsy. While Amgen relies on its massive scale and cash generation, Axsome is currently prioritizing the commercialization of its newer therapies to reach long-term profitability.

The case for Amgen

Amgen discovers and delivers medicines for serious diseases across several core areas, including inflammation, rare disease, and oncology. Its massive scale allows it to distribute products to roughly 100 countries, though McKesson (NYSE:MCK), Cencora (NYSE:COR), and Cardinal Health (NYSE:CAH) accounted for 77% of its fiscal 2025 revenue. Customer concentration like this adds a layer of risk, even if it is common among major biotech stocks.

In FY 2025, revenue reached nearly $36.7 billion, an increase of approximately 9.9% year over year. The company reported net income of roughly $7.7 billion, showing significant growth from the $4.1 billion earned in 2024. This resulted in a net margin of 21%, which is a measure of profitability that shows how much of each dollar of revenue is converted into profit.

As of Amgen's December 2025 balance sheet, the debt-to-equity ratio is 6.3, meaning total debt is more than six times the value of shareholder equity. The current ratio, which measures the ability to pay short-term obligations using current assets, is approximately 1.1. Free cash flow for the year reached nearly $8.1 billion, representing the cash a company generates after accounting for the money spent to maintain or expand its asset base.

The case for Axsome Therapeutics

Axsome Therapeutics is a biopharmaceutical company specializing in therapies for central nervous system conditions, such as migraine and major depressive disorder. It leverages strategic partnerships to expand its global reach, including research collaborations with major industry players like Pfizer (NYSE:PFE) and AstraZeneca (NYSE:AZN). The company currently markets its portfolio in the United States and works with partners to expand into European markets.

In fiscal 2025, revenue increased by approximately $638.5 million, skyrocketing 65.5% year over year. Despite this strong top-line growth, Axsome reported a net loss of nearly $183.2 million as it continues to invest in its pipeline. The resulting net margin was negative 28.7%, though this was an improvement from the negative 74.5% margin seen in 2024.

As of its December 2025 balance sheet, Axsome maintains a debt-to-equity ratio of 2.7. The current ratio is approximately 1.6, indicating that current assets like cash and receivables comfortably cover short-term liabilities. Free cash flow was negative $93.9 million for the year, which is typical for biotechs that are still scaling their commercial operations.

Risk profile comparison

Amgen faces significant pricing pressure from government and commercial payers, specifically due to Medicare price setting for key products like ENBREL and Otezla. The company also deals with ongoing patent litigation and manufacturing concentration in Puerto Rico, which is historically susceptible to natural disasters. Furthermore, cybersecurity remains a concern after previous incidents involving third-party vendors and data exfiltration.

Axsome Therapeutics relies on a relatively small product portfolio and has an accumulated deficit of nearly $1.3 billion as of the end of 2025. Much of its intellectual property is licensed from an entity owned by its CEO and chairman, which creates potential conflicts of interest and dependency on these specific agreements. The company also faces generic competition risks and the ongoing need for significant capital to fund clinical trials.

Valuation comparison

Amgen currently trades at a significantly lower valuation than Axsome Therapeutics based on both forward P/E and P/S ratio multiples.

Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.

Which stock would I buy in 2026?

Comparing Axsome and Amgen is somewhat difficult, as these drug companies are at very different stages of development. Amgen is a mega cap with more than 45 years of experience in the industry. Axsome was founded less than a decade and a half ago and has a market cap of about $10 billion. Amgen has three dozen approved treatments, while Axsome has three. The trend holds when examining their pipelines: Axsome has 10 candidates, and Amgen has 44. Nearly 30 of Amgen's studies are in Phase 3.

In short, Amgen is a mature, established business. Increasing revenue by 10% is nothing to sneeze at, but Axsome's soaring growth is impossible to ignore -- and investors haven't, as evidenced by the stock's forward P/E. Folks are already pricing in a fair amount of continuing success at Axsome, which adds risk.

I love a Steady-Eddie company that pays a dividend, as Amgen does, but I frankly already own many of those types of businesses. I would rather buy a small position in Axsome, because while the risk is obviously higher, I think the potential reward is, too.

Erin Kennedy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amgen, AstraZeneca, Axsome Therapeutics, and Pfizer. The Motley Fool recommends McKesson. The Motley Fool has a disclosure policy.