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 in Agenus (NASDAQ:AGEN) shot higher by more than 10% today after the company reported first quarter financial results yesterday and compelling phase 3 data for its malaria vaccine today.

So What: Yesterday, the clinical stage biotechnology company reported that its revenue from collaboration partners totaled $3.95 million in the first quarter and that its net loss was $18.7 million in the quarter. That loss was significantly higher than a year ago when the company reported a net loss of just $409,000.

A ramp-up in research and development activity led to the company reporting that its cash burn totaled $10.7 million in the first quarter. Agenus finished the quarter with $79.3 million in cash, up from $40.2 million the year before.

Today, the company reported that phase 3 data from a trial of GlaxoSmithKline's (NYSE:GSK) malaria vaccine, which incorporates Agenus' QS-21 Stimulon to boost efficacy, shows that the vaccine reduced the number of malaria cases in children by 26% over a 48-month follow-up period.

Now What: Agenus shares have rallied sharply this year on optimism surrounding its pre-clinical stage research into immuno-oncology therapies.

In January, Incyte Corp inked a deal with Agenus to develop new therapeutics targeting immune system checkpoints. As part of that deal, Incyte paid Agenus $60 million up front, including $25 million in license and program fees and $35 million in the form of an equity investment.

If those preclinical programs advance, Agenus could receive up to $350 million in eventual milestone payments.

However, that's a big "if".

More than 90% of drugs entering clinical stage trials end up failing, and the track record for cancer drugs is even worse. This suggests that investors may want to temper a little of their enthusiasm for the immuno-oncology program, at least until we get more insight in human trials.

Instead, investors may want to be focusing more on the company's vaccine programs.

GlaxoSmithKline is using Agenus' technology in vaccines that could be used to treat malaria, melanoma, and shingles. The malaria vaccine is the most advanced of these programs, with an application for approval already having been filed. If the phase 3 trial results lead to an FDA approval, Agenus will receive a single digit royalty on any eventual sales.

Agenus is also developing therapies on its own that could help in the treatment of brain cancer and genital herpes. Data from a phase 2 trial of its brain cancer vaccine should come this year, and that could lead to the initiation of a phase 3 trial.

Source: Agenus,

Overall, Agenus is an interesting, but very small market cap, clinical stage biotechnology stock without any products on the market. As a result, it's a high risk, high reward play that most investors would likely be best served avoiding, at least until more data on its programs is released or its royalties begin to kick-in from GlaxoSmithKline. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.