The problem with investing in turnaround candidates is that sometimes it's hard to know exactly when they've bottomed out.

Take Genzyme (Nasdaq: GENZ), for instance. The company seemed to be headed in the right direction. It got its plant cleaned up after a viral contamination halted production. It also solved the problem with machinery leaving bits of rubber and metal in the drug vials by contracting with Hospira (NYSE: HSP) to do the fill and finish operations for some of its drugs.

Problems solved; it's in the clear, right? Unfortunately, no.

Today, Genzyme announced that the Food and Drug Administration wants a consent decree on its Allston plant where the problems have occurred. Essentially, the consent decree gives the FDA authority to appoint a third party to inspect the plant and confirm that it's in compliance with the FDA. In addition to any lost time dealing with inspectors, Genzyme has to pick up the tab through fees and fines.

How much is that going to cost? That's under negotiation with the FDA. How long will Genzyme be subject to the consent decree? That's up for negotiation, too. At this point, investors don't have much to go on.

Genzyme does have one saving grace: Most of the drugs it makes don't have any competition. The FDA isn't likely to put a hold on shipping products because Genzyme's offerings are the only treatment available to patients.

Of course, that advantage is subject to change. The FDA recently approved a drug from Shire (Nasdaq: SHPGY) and is reviewing another from Pfizer (NYSE: PFE) and Protalix BioTherapeutics (NYSE: PLX), both of which will compete with Genzyme's drug to treat Gaucher, Cerezyme.

A consent decree certainly isn't the end of the world for Genzyme -- Schering-Plough took care of its consent decree and eventually got bought out by Merck (NYSE: MRK). But the decree will make a turnaround that much harder and give Carl Icahn more fuel for his proxy fight.

Tread lightly, Fools; jumping in at the bottom can be profitable until you notice you're standing in quicksand.

Pfizer is a recommendation of the Inside Value newsletter. If you're interested in picking through the wreckage for possible turnaround candidates, you should have the Inside Value team on your side. Check it out for free with a 30-day trial

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Turn the Fool's disclosure policy around, and you're just staring at a blank piece of paper.