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 the home infusion care and pharmacy benefits management administration services company BioScrip (OPCH -0.35%) dropped by more than 16% today on heavy volume after releasing its first-quarter earnings report. Although the company posted strong organic growth for its infusion care business segment on a year-over-year basis, BioScrip still lost $16 million or $0.26 per diluted share during the three month period.

Perhaps the worst news, though, is that the company's balance sheet is in terrible shape, casting doubt on its ability to finance its ongoing operations over the long-haul. Specifically, BioScrip exited the quarter with only $23 million in cash and cash equivalents, but $418 million in debt.  

Adding to the high degree of uncertainty, the company can't seem to break away from its long-standing kickback scandal with Novartis. According to various sources, Novartis allegedly paid BioScrip kickbacks to boost sales of the specialty drug Exjade from 2007 to 2012. As a result, the company is now being sued by the New York Attorney General's office on behalf of Medicaid recipients in the state of New York.  

So what: BioScrip's share price has been nosediving for months as a result of its financial concerns and this lawsuit. The fact of the matter is that the company simply can't withstand a major judgement against them given their worrisome balance sheet.

Now what: This tiny company is facing a ton of headwinds right now and there's no guarantee it will see the light of day. All told, it doesn't have the resources to operate its businesses efficiently and deal with a major lawsuit. That's why you probably want to steer clear of this falling knife for the time being.