Exelixis (Nasdaq: EXEL) has more assets than it did on Friday, but after the 16% drop in its share price yesterday, it appears investors are valuing those assets considerably lower. I smell an opportunity -- albeit with some risk.

The development-stage drugmaker said yesterday that it was ending its year-and-a-half-old partnership with Bristol-Myers Squibb (NYSE: BMY) to develop cancer drug XL184. Exelixis regains the full rights to the drug, but it also won't have a partner to share the development costs. XL184 is currently in a phase 3 trial for a type of thyroid cancer, and there were -- and still are -- plans to start a phase 3 trial for brain cancer around the end of the year. XL184 is also in a large phase 2 trial to see whether it'll work in other cancer types.

Exelixis can afford to pay for the development on its own for some time. As part of the dissolution of the partnership, Bristol-Myers is giving Exelixis $17 million, which will pay for about three months of Bristol-Myers' share of the development costs. All told, the added costs will be less than $20 million this year, and about $75 million next year.

But Exelixis might not let it go that far; out-licensing the drug again seems to be in the cards, although the timing of finding another partner is a little less clear. The drugmaker will present phase 2 data in November, and the thyroid cancer trial will read out in the first half of next year. Exelixis could roll the dice, hoping they'll come out positive, which would increase the terms it could get for the drug.

Whether Exelixis is a bad-news buy depends a lot on why the companies parted ways. Exelixis claims the problem is a difference in priorities; Bristol-Myers has other oncology drugs hitting high notes, but for Exelixis, XL184 is the company's best hope at turning profitable.

On the flip side, Bristol is the second company to give up on XL184; GlaxoSmithKline (NYSE: GSK) had an option to license the drug and turned it down. Bristol-Myers could have inside knowledge that leads it to think XL184 isn't worth developing, although the public data thus far suggests otherwise.

Bristol-Myers backing out isn't good news, but it isn't a guarantee that the drug will fail, either. As tyrekefan reminded Rule Breakers' members on the newsletter's discussion boards, Johnson & Johnson (NYSE: JNJ) dropped development of Amylin Pharmaceuticals' (Nasdaq: AMLN) Symlin, but the company was able to battle back, get Symlin approved, and license another drug, Byetta, to Eli Lilly (NYSE: LLY).

Exelixis isn't without risk -- for every Amylin, there's a dropped drug that's faded into oblivion. But with an enterprise value of about $340 million, not including cash changes since the end of the first quarter, Exelixis doesn't look like a particularly expensive bet.

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.