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What happened

After disclosing that the U.S. Food and Drug Administration won't be issuing an approval for a key product as soon as hoped, Endologix, Inc. (OTC:ELGX.Q) found its shares tumbling 21.3% by 2:30 p.m. EST.

So what

Endologix was hoping that the FDA would weigh in this year with an approval of Nellix, the company's endovascular aneurysm sealing (EVAS) system for infrarenal abdominal aortic aneurysms. If approved, management thinks EVAS could displace the use of endovascular stent-graft devices by doctors.

Maybe so, but we'll have to wait longer to find out.

Despite Nellix already being available in Europe, the FDA wants to see two-year follow-up trial data. Once that's submitted, the FDA also wants a regulatory committee to debate Nellix's pros and cons before making its final decision on the system.

Management expects to deliver the FDA the two-year data in the second quarter of 2017; if it does, a committee recommendation could happen before the end of next year. If so, then the soonest we're likely to know if Nellix gains approval is the first quarter of 2018. That's a whole year later than management had previously planned.

Now what

Another year of waiting means another year of cash burn and losses, and that's never something investors want to hear. The company's $52.1 million in third-quarter sales increased on a pro forma basis by 10% from a year ago, but gross profit of $36.9 million was more than offset by $48.2 million in operating costs, resulting in a net loss of $15.2 million in the period.

These losses and the acquisition of TriVascular Technologies leave the company with total cash and investments of $63 million as of Sept. 30, 2016, compared to $177.3 million as of Dec. 31, 2015.

Overall, Nellix could be an important advancement in treating patients. However, the timeline means that investors can sit on the sidelines for a bit. That's why I'm focusing my attention on other money-making ideas, rather than jumping in and buying on this drop.

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.