Better Long-Term Buy: This Emerging Player or the Industry Leader?

AbbVie (NYSE: ABBV) is one of the largest pharmaceutical companies in the world. Though its portfolio spans many therapeutic areas, it is particularly well known for its work in immunology, a field in which it boasts some of the best-selling therapies. However, many smaller drugmakers are trying to break into this space.

One of them, Abivax (NASDAQ: ABVX), has grabbed quite a few headlines of late thanks to a potentially transformative immunology medicine still in development. Should investors opt for the well-established giant or the up-and-coming challenger?

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AbbVie is a relatively safe bet

AbbVie made its name in immunology thanks to medicines like Humira, a therapy that was once the world's best-selling drug. Although it has now lost patent exclusivity, AbbVie's lineup also includes Skyrizi and Rinvoq, two immunosuppressants approved across a range of indications, including ulcerative colitis, eczema, plaque psoriasis, Crohn's disease, rheumatoid arthritis, and more. In the first six months of 2025, Skyrizi was the fifth-best-selling medicine in the world, and Rinvoq was at No. 15.

These are AbbVie's best growth drivers, and they won't lose patent exclusivity until the next decade. Together with the rest of the drugmaker's lineup, they allow the company to generate consistent revenue and earnings. AbbVie is also an innovative company. Thanks to a deep pipeline, it should succeed in launching newer and better products that will help it remain competitive. Lastly, AbbVie is a fantastic dividend stock. It is a Dividend King, or a a company that has increased its dividend payouts for at least 50 years in a row. All of these factors make it a reliable income stock to hold.

Abivax has massive upside potential

Abivax's investment thesis looks very different. The company is a clinical-stage biotech -- it currently generates no revenue and is unprofitable. However, Abivax's leading candidate, obefazimod, seems promising. It is being developed as a potential treatment for ulcerative colitis. Whereas drugs like Skyrizi and Rinvoq work by suppressing the body's immune response to treat certain diseases -- an approach that is effective but can weaken the immune system and make patients more vulnerable to other diseases -- obefazimod takes a different approach. And so far, clinical data suggest it could be just as effective.

In a phase 3 clinical trial, it helped patients, including almost half who had previously taken other therapies, achieve remission. Obefazimod could disrupt the ulcerative colitis market and make Abivax highly successful. Of course, there are significant risks here. If Abivax encounters clinical or regulatory setbacks, its share price will fall off a cliff. But the upside potential is massive, provided the company can deliver. There is also the possibility that Abivax will be acquired this year at a significant premium, which would benefit investors who initiate positions today.

Which one should you buy?

Investors who are risk-averse and looking for stability, reliability, and income should definitely opt for AbbVie. It's the better long-term play. If you want to invest in Abivax, you should expect heightened risk and volatility -- but should the drugmaker successfully bring obefazimod to market, shareholders could reap the rewards.

Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AbbVie. The Motley Fool has a disclosure policy.