The most horrible anti-XCOM weapon of the game. It is basically an organic launcher for a sentient form of living missile which erupts in acid and enzymes upon exploding on target. The result is often a dissolved heap of flesh of an agent with no equipment, with the only form of defense being the personal shield of aliens. The accuracy of the weapon is its frustrating effect, as it ALWAYS hits an agent on open ground, making the combat a matter of hiding and seeking unless the agent is cannon fodder.
While X-Com engineers cannot reproduce this weapon, it is a strangely effective weapon when used against aliens and enemy guards. Keep in mind that the whole purpose of this weapon is to cause damage through object destruction. This means it's useless when you want to gather equipment. But if destruction is your whole objective, go for it!
Official Entry: "This weapon is essentially an organism that is genetically engineered to launch a living missile which flies directly towards its chosen target. The missile then erupts and a foul smelling sticky goo smothers the unfortunate victim. The substance is a combination of enzymes and acids that can erode metallic or organic compounds. Unfortunately this weapon is not very effective against Aliens and we cannot replicate it."
An entropy launcher is simply a launcher. All launchers have a homing ability, so your agent's firing accuracy is irrelevant.
The missile will only directly damage your agent through impact damage. The impact damage against disrupter shields saps 1/3rd of the shield battery per missile, and if it destroys the shield, the target will be covered in enzyme! So even if you do not use the missiles for the enzyme, the launchers are useful for rapid destruction of enemy shields.
The major damaging effects of the entropy missile is done through the enzyme. This works by destroying the durability of all of your carried items. Once the enzyme has eaten through the objects, they are destroyed. It's pretty obvious what would happen when an explosive or weapon is eaten through. It explodes. This is what really kills units covered in enzyme.
Because the enzyme only targets objects, the only way to survive an entropy missile attack is to drop everything and strip off your armour. When your agent stops smoking after a few seconds, the enzyme will have worn off. This method of saving your soldier is by far the most effective, but it also puts your agent in an incredibly vulnerable position.
Escaping the combat zone is also a way of saving your agent, but you lose the agent's services for the rest of the battle.
It's plainly obvious that any unit that's not carrying any weapons will not be too greatly affected by the enzyme. If used against the aliens, they are only useful against Anthropods and Skeletoids.