Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Alnylam Pharmaceuticals (NASDAQ:ALNY), a biopharmaceutical company focused on developing RNA-based therapeutics to treat life-threatening diseases, sank as much as 11% after reporting its third-quarter earnings results.

So what: For the quarter, Alnylam delivered $9 million in collaborative revenue, which was a 46% decline from the $16.8 million it reported last year. The decline is due to the discontinuation of a partnership with Cubist Pharmaceuticals that was ended earlier this year. Net loss ballooned to $29.7 million, or $0.48 per share, from $19.5 million, or $0.38 per share, in the prior year. By comparison, Wall Street had expected a narrower loss of just $0.40 per share from Alnylam. Furthermore, the company forecasted that revenue would be similar in the fourth quarter, which likely means a similar net loss. As of yesterday, the EPS loss expectation for the fourth quarter had only been $0.42, so this looks to be trending a bit weaker than the consensus.

Now what: This seems like a pretty cut-and-dried case of "buy the rumor, sell the news." Alnylam's share price has exploded higher this year, and the prospect of widening losses and a shrinking cash balance is surely enough to worry skeptical investors. Ultimately, the value in this company is locked up in its pipeline potential and not one quarter's earnings, so that's the good news! However, if you're looking for traditional earnings and value to guide your investing thesis, then let's just say that Alnylam may not be the right stock for you for a long time as its pipeline is predominantly early stage and preclinical.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

The Motley Fool recommends Alnylam Pharmaceuticals and Cubist Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.