I have never seen anything quite like that before. I'm pretty sure it's not a parasite or disease. I think the best course of action would be to break the cotton end off of a Q tip, net the fish out and try to gently pry the object out of his mouth.
I have had big cichlids kill tankmates and get a dead fish temporarily stuck in their mouths, but they have always been Able to dislodge the body before it got to the point I needed to intervene. Keep the updates coming.