Strange, Pics are just a little to close to see exactly what is going on there. Is that the door at the back of the picture? It seems like that rubber looking thing is a water barrier to keep the water in front of that drain? Could you take a photo of the whole area? Maybe a bit more zoomed out?
You'll need to open the wall. How much depends on whether this is a load bearing or partition wall. Start at the bottom and work your way up the wall and expose all the damaged area. There's a good chance it will turn the corner and continue with the bottom plate.
After all the damage is exposed, show us more photos. As joeyr mentioned, stand back a bit to show the whole wall in at least one shot.
"They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety."
B. Franklin 1759