Sickness lowers all stats by 1 per level. It can be cured either by waiting for it to fade, going to a doctor, or by using the Medicine skill. It is resisted by the Resistance skill. The Plague Rat is one of the only creatures to use the Sickness status effect.
Tip: Get yourself infected with sickness and go "Eat/Sleep/use Medicine/Repeat" in any restaurant. This will give you around 800 free XP and a Medicine level of 5 or 6.