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 medical device manufacturer Mela Sciences (Nasdaq: MELA) were more than chopped in half as investors ran for cover after a Food and Drug Administration review cast a negative light on the company's MelaFind device.

So what: On Thursday, a panel of FDA advisors is scheduled to meet to make a recommendation on the approval of MelaFind, a device designed to diagnose skin cancer. But after the review released by the FDA today, investors seem to have little hope that Thursday's outcome will be good. Based on the data the FDA has from Mela, it doesn't see a worthwhile trade-off in the reduction in biopsies using MelaFind versus the possibility of missing a life-threatening skin cancer.

In other words, the FDA is worried that the device could actually cause more harm than good.

Now what: Not surprisingly, Mela doesn't agree with many of the review's conclusions, but that may not be enough to sway the panel on Thursday or the FDA's eventual  decision to approve or reject. Certainly if, for some reason, it's a thumbs-up for MelaFind, investors would be in for a rocket ride. As it looks right now though, the FDA may require another study, which might then press Mela to raise new capital --  or seek a partner like General Electric (NYSE: GE) or Siemens (NYSE: SI).

Want to keep up to date on Mela Sciences? Add it to your watchlist here by clicking here.

The Fool has bought calls on MELA Sciences. 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.     

Fool contributor
Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or on his RSS feed. The Fool's disclosure policy assures you no Wookiees were harmed in the making of this article.