At the rate Inverness Medical Innovations (AMEX: IMA) has been buying up health-care companies, it wouldn't take too long for the company to become the next Johnson & Johnson (NYSE: JNJ).

Investors aren't so sure that the extrinsic growth is working the way Inverness planned it to. The stock was down 16% Wednesday to cap off a drop of more than 30% since the beginning of the year.

The company turned $27.6 million in adjusted non-GAAP net income in the fourth quarter into a GAAP loss of $12.5 million because of amortizations and one-time charges, including those associated with the acquisitions of Diamics, Cholestech, HemoSense, and BBI Holdings. That's a whole lot of charges -- and a lot companies to be integrating at one time.

That's not even all of the recent additions. Since the close of the quarter, Inverness has also agreed to purchase Matria Health Care (Nasdaq: MATR). The $900 million deal was done in both cash and stock, so Matria's investors are also feeling the hurt from Inverness' recent stock price drop.

My guess is that investors are having trouble evaluating the company, with so many new additions and its joint venture with Procter & Gamble (NYSE: PG) causing year-over-year comparisons to be difficult at best. Rather than holding onto a company that they don't fully understand, they're selling.

That's a pretty smart move from my perspective. Imagine all the money investors could have saved if they'd sold when they realized they didn't understand Enron's business.

That's not to say that I think Inverness is necessarily going down in flames. There are plenty of companies that have turned around after having extrinsic growing pains -- Invitrogen (Nasdaq: IVGN) being a prime example. Now might be the perfect buying opportunity, but it's not clear -- to me at least -- how long the transition to becoming a conglomerate will take.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Johnson & Johnson is a selection of the Income Investor newsletter. The Fool's disclosure policy wants to take over the world one document at a time.