What: After reporting third quarter financial results and updating investors on its clinical stage pipeline, share in XOMA Corp (NASDAQ:XOMA) tumbled by 21% earlier today.

So what: A high profile failure of XOMA's monoclonal antibody gevokizumab for Behcet's disease uveitis in phase 3 in July led to XOMA's shares plummeting from $5 to less than $1, but shares have regained some of their losses more recently following news in October that XOMA had inked a licensing deal with Novartis (NYSE:NVS).

The Novartis deal included an upfront cash payment of $37 million in exchange for global rights to XOMA's TGFb antibody program and extended the maturity date for a $13.5 million note due to Novartis to September 2020.

In addition to the Novartis deal, XOMA also orchestrated a major restructuring of its operations in Q3 to eliminate costs in the wake of gevokizumab's disappointment. That restructuring includes the sale of its biologics manufacturing operation to Agenus for $5 million plus $1 million in Agenus stock and the divesting of its biodefense program, as well as lay-offs.

Overall, XOMA's R&D expenses dropped to $17.6 million from $20.2 million last year, and its SG&A costs totaled $5.6 million, up slightly from $5.4 million a year ago due to increased consulting costs tied to its deal with Novartis, which offset salary savings tied to the restructuring.

Now what:  The company's restructuring focuses XOMA on its endocrine program, which includes XOMA 358, a therapy for the treatment of congenital hyperinsulinism that reduces insulin receptor activity.

Last quarter, XOMA kicked off phase 2 development of XOMA 358 by opening the first of two proof-of-concept studies. While we won't know whether or not XOMA 358 will succeed in these mid stage studies for a while, the company believes that its restructuring does give it the financial wiggle room necessary to fund its research and operations through 2017.

Although it's encouraging to know that XOMA has moved quickly to right size itself and reduce its cash burn, XOMA remains a high risk company that doesn't have any commercialized products. Since there's likely to be a long wait until we get actionable data on XOMA 358, I'm simply unwilling to take on the risk of buying shares on this sell-off.