The include Books app is pretty good. Looks decent, can do notes, highlights, and bookmarks, though the options for PDF's are more limited. It can import non-DRM ePub books from other sellers (which are usually available from most third party ebook sellers).
Amazon's Kindle app is also decent. It has a few a few more features, but the UI isn't quite as nice. Importing is also possible, though you have to use an Amazon provided email to do so. It is less convenient in my opinion. It also does not support ePub, but it does support a couple of other non-DRM formats that are usually available. I can't remember what they are at the moment.
Both apps offer a landscape two page reading mode. I also prefer this.
I prefer using the Books app when I can, and it costs you nothing to try it. Besides Apple's iBooks store, I often import books from other sellers, mostly Baen Books.
Despite this, I end up using the Kindle app more often. This is because I pay for the Kindle Unlimited plan. While the selection of books is far from premium, I can read a lot of decent entertainment books each month for a lot less money. It's a way of keeping myself entertained when I don't have a specific subject or title in mind.
There are a lot of other apps, none of which I've tried lately, but these two are free to download and try, and both have huge libraries to experiment with; including most of the Gutenberg library of copyright expired books; which are free.
As for PDF's, they are best annotated by a dedicated PDF app. I use Documents by Readdle for most, and Notability for study/notetaking.