When it comes to biotech stocks, a pipeline can make or break a company. Due to the nature of the clinical trial system, a company can work for years on a new drug only to have all that work disappear when a therapy is found unsafe and ineffective. This is good for the safety of healthcare, but it does introduce instability to companies.

There are also drug patents. After a given amount of time, any company can produce a generic version of the drug a biotech company spent millions developing and have come to depend on revenue-wise. And generics are so much cheaper, that once they are introduced the sales of the name-brand version almost always drop off drastically.

So how do biotech companies (and biotech stocks) ensure their survival? Through strong pipelines. Biotech companies that have a number of drugs in different stages of development are more likely to be profitable long term. By introducing drugs at different times they can soften the blows from expired patents or new, better treatments. By having a wide number of drugs in development, more are likely to make it through clinical trials and gain FDA approval.

Here are four biotech stocks that have not done that. These companies either don’t have enough drugs in development or their drugs are not spread out well. And this is not a quick fix. Each phase of drug approval can take years.

Biotech Stocks With Leaky Pipelines: Madrigal (MDGL)

Madrigal Pharmaceuticals Inc (NASDAQ:MDGL) is a biotech company developing drugs that target a specific hormone receptor. At the moment, Madrigal has no drugs on the market, but it does have a promising drug in MGL-3916.

Right now, all their hope rests with MGL-3916, and for good reason.

This drug treats NASH. NASH begins as fatty accumulation in the liver, but eventually leads to inflammation and a buildup of fibrous connective tissue as well. NASH is generally asymptomatic, but can lead to dangerous things like cirrhosis and liver cancer. Madrigal has shown that MGL-3196 both improves the components of NASH and decreases the metabolic syndrome that causes it.

NASH currently has no approved drug treatments.

This is a problem, of course. But it’s not an ignored one. MGL-3196 is competing with a number of other clinical trials in Phase 2 or later.

And Madrigal’s pipeline only has two drugs: MGL-3196 and MGL-3745, which is still in the pre-clinical stages of development, years from commercialization.

Now, MGL-3916 is reported to be more safe and targeted than other treatments in development for NASH, but drugs can fail for many reasons. If MGL-3196 fails in Phase 2 or 3, Madrigal only has MGL-3745 to fall back on. And right now the preclinical asset is being listed as a “follow-on compound to MGL-3196.” So a failure here could mean Madrigal is left with nothing in development.

Even if MGL-3196 is successful, that’s just one drug that needs to sustain the company on its own for years. (Even longer if MGL-3196 is just an enhancement to the existing therapy).

Biotech Stocks With Leaky Pipelines: AbbVie (ABBV)

AbbVie Inc (NYSE:ABBV) is by far the largest company on this list with a market cap of $146 billion.

The problem with Abbvie isn’t a lack of research going on or poorly spaced research, the problem is that Abbvie walks along the edge of the patent cliff. And the only thing keeping it up is its star drug, Humira. Humira should have gone generic already, but a long series of patents has kept it in Abbvie’s hands entirely. And Abbvie’s reasons are clear: Humira is the best selling drug in the world.

Humira accounted for $18 billion of Abbvie’s $28 billion in sales in 2017.  That’s 65% of Abbvie’s revenue. It’s next biggest selling drug, Imbruvica, only brought in $708 million. That’s not nothing; Far from it. But it’s not going to catch Abbvie if it slips off the cliff.

Bloomberg via The Washington Post points out that when taking into account new and potential drugs, analysts expect Abbvie to be left with “a substantial potential sales hole” in 2022 when Humira sales are predicted to decline. Abbvie does have a lot of drugs in their pipeline, but a large number are other indications for existing drugs.

InvestorPlace’s Aaron Levitt recently sang the praises of Pfizer Inc.’s (NYSE:PFE) pipeline and how they’ve weathered their already lost patents and soon-to-be-lost patents. Considering its size and the height of its cliff, AbbVie’s pipeline should look far more like Pfizer’s than it does.

Biotech Stocks With Leaky Pipelines: Rigel (RIGL)

Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL) is a small biotech company with a focus on drugs that disrupt critical signaling pathways in disease mechanisms. Their business strategy is dependent on one drug, Fostamatinib.

Fostamatinib blocks IgG receptor signaling. When activated, IgG receptors cause the body’s immune system to destroy certain cells. For example, in Immune Thrombocytopenic Purpura — the first indication Fostamatinib will likely be approved for — IgG receptor activation causes the destruction of the body’s own platelets — a vital component of the blood.

A lot riding on Fostamatinib — which just failed to meet a phase 2 endpoint for one of its indications. This sort of thing happens all the time in drug development. But it’s not the first time for Rigel or Fostamatinib. The FDA is set to rule on the drug’s first indication later this month.

So what else does Rigel have in its pipeline in case Fostamatinib misses more endpoints or doesn’t sell as well as their hoping? … Not much.

Of the eight products and indications listed on Rigel’s pipeline, three are used for fostamatinib indications. The other five are all partner-sponsored (so less profits for them in the long run, but also less financial risk) and all much further up the pipeline.

Biotech Stocks With Leaky Pipelines: Alexion (ALXN)

A few weeks ago, I highlighted BioMarin Pharmaceutical Inc. (NASDAQ:BMRN), a small biotech focused on treating rare diseases. I pointed out how, despite the relatively small number of people helped by its drugs, BioMarin has a strong, diverse pipeline.

Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN) is a similar company with an ultra-rare disease focus. Despite having a larger market cap than BioMarion, Alexion’s pipeline contains one yet to be released drug (albeit with six possible indications), one new indication for an existing drug and one “additional complement” so early in development that Alexion has not yet named it.

Testing a single drug for many different diseases or disease states is not a bad thing. Only testing a single drug for many different diseases or disease states is, however. Any finding that shows limited safety of this drug, ALXN1210 has the potential to wipe out Alexion’s entire pipeline.

Alexion currently has a similar issue to Abbvie in that most of its revenue depends on a single drug — in this case, Soliris. Last year, Soliris accounted for a staggering 89% of Alexion’s revenue. Though Alexion currently has patents on this drug through 2027, Amgen, Inc. (NASDAQ:AMGN) is currently developing a biosimilar.

And considering that Soliris currently costs $500,000 per patient year, any competition is likely to cut into Alexion’s revenue in a big way — and Alexion has little to make up for it.

As of this writing, Regina Borsellino held no positions in the aforementioned securities.