A second opinion is still needed, but given the source, we can safely say that Danny Duffy's elbow is in trouble:
Duffy had mostly been pitching well, although he had struggled with his control, walking nearly six batters per nine. While at first you could be forgiven for just assuming that Jonathan Sanchez's negative traits were leaking out of him and into Duffy, it turns out that the problems likely stem from his elbow. That elbow, by the way, was described three starts ago as being in pain.
So, what to do with Duffy if you own him? In single-season leagues, you'll want to drop him. (Though, again, maybe waiting until after the second opinion is the way go to. If it were cut-and-dry, there would be no second opinion to begin with.) In keeper leagues, you're looking optimistically at getting him back in May or June of 2013, most likely, and that's based on the idea that the Royals would simply bring him back to the majors rather than letting him work his way back slowly given his youth.
If you can stomach the idea of being without him for two-to-three months in 2013, then hold on to him. But given he hasn't put up huge numbers in the majors yet, and, like anyone who undergoes major elbow surgery, might not have his control back right away once he does return to action -- you might be better served just cutting him in keeper leagues, too, and trying to pick him back up on the cheap at next year's draft.
Duffy had a chance to be Kansas City's top starter in 2012, and not in the hilarious kind of way where Bruce Chen gets that nod. It's a shame for the Royals that they can't seem to develop any pitching on their own, without something tragic happening that keeps them off the mound.*
*Or, in the case of Luke Hochevar, is tragic because he is on the mound.