Just a few months ago, it was considered one of the brightest stories in European biotech. MoonLake Immunotherapeutics, based in Switzerland, had won over investors with a drug that promised to revolutionize the treatment of hidradenitis suppurativa, a chronic skin disease that causes pain, lesions, and a devastating impact on patients’ quality of life. The company had been labeled a “unicorn,” capable of reaching a multi-billion-dollar market capitalization in record time, and even pharma giant Merck had been linked to a potential acquisition.

Yet, in just a few hours, the dream turned into a nightmare. On Monday, following the release of Phase 3 results from the VELA clinical program, the stock collapsed spectacularly: down 88% in a single day, wiping out billions of dollars in value and leaving investors in shock.

The coup de grâce came from the results of the VELA-1 and VELA-2 studies, designed to prove the efficacy of sonelokimab, the next-generation antibody at the core of MoonLake’s pipeline. At week 16, the primary endpoint was not convincingly met. In VELA-1, the drug showed a clear benefit over placebo, but in VELA-2 the outcome was different: patients on placebo responded far better than expected, narrowing the gap and erasing the statistical effect. In market terms, this is called a “failed primary endpoint,” and it is often enough to extinguish the enthusiasm surrounding an entire company.

Investment banks wasted no time. RBC immediately slashed its price target from $67 to $10, calling the results “disappointing” and scaling back MoonLake’s ambitions. Stifel also downgraded the stock, cutting its target from $77 to $13. For analysts, the problem is not only the lack of statistical significance, but also the perception that sonelokimab may not differentiate itself sufficiently from competitors in a field already dominated by giants like AbbVie and UCB.

The collapse is all the more dramatic considering that, until just days ago, MoonLake had been at the center of takeover rumors. A potential deal with Merck, estimated at more than $3 billion, had fueled expectations and boosted the stock in the spring. Now, that prospect seems remote: it is hard to imagine a big pharma betting billions on an asset that failed in its lead indication.

Still, the company is not giving up. In its official statement, management stressed that the drug nevertheless showed positive signals and a solid safety profile, and announced plans to discuss the regulatory path forward with authorities. MoonLake also has other ongoing studies, from psoriasis to psoriatic arthritis, which could still restore credibility to the project.

But the biotech market is ruthless. Investors care less about future promises than about hard data. And in this case, the data show that Europe’s unicorn could not clear the decisive hurdle. On the stock market, the line between shooting star and legend is razor-thin: just a few weeks, an over-performing placebo, and an unconvincing press release can turn a darling stock into a penny-stock nightmare.

MoonLake remains a name to watch, but today its story is above all one of a blazing rise followed by an equally spectacular fall—the symbol of how, in biotech, a dream can vanish in an instant.