Regeneron Pharmaceuticals experienced a significant stock decline on Monday, with shares dropping 11.8% in premarket trading following disappointing results from a late-stage clinical trial for its experimental skin cancer treatment. The company’s fianlimab-cemiplimab combination therapy failed to meet the primary endpoint in a study involving patients with advanced melanoma, one of the most aggressive forms of skin cancer.

The combination treatment was evaluated for its ability to improve progression-free survival, which measures how long patients live without their cancer worsening. Despite showing a numerical improvement of 5.1 months in median progression-free survival compared to Merck’s Keytruda, the difference did not achieve statistical significance, rendering the results insufficient for regulatory approval.

The Phase 3 trial examined fianlimab used in combination with Regeneron’s already-approved drug cemiplimab, marketed under the brand name Libtayo. The therapy was being tested as a first-line treatment for advanced melanoma, representing a significant potential market opportunity for the biotechnology company.

Wall Street analysts responded harshly to the news. Evercore analyst Cory Kasimov described the outcomes as the worst-case scenario, noting that while the fundamental business impact may be limited at this point, investor sentiment toward the company is likely to deteriorate further in the coming days.