Investing.com -- Regeneron Pharmaceuticals shares dropped nearly 12% in premarket trading on Monday after the company reported its phase 3 trial for fianlimab in metastatic melanoma failed to meet its primary endpoint.

The trial did not achieve statistical significance for the primary endpoint of improvement in progression-free survival, the company said.

A numeric improvement of 5.1 months in median progression-free survival was observed for the high-dose fianlimab combination compared to pembrolizumab monotherapy.

A phase 3 head-to-head trial of the high-dose fianlimab combination versus Opdualag (nivolumab and relatlimab-rmbw) is ongoing.

Following the trial update, Citi downgraded Regeneron to neutral from buy and lowered its price target to $700 from $900. Analyst Geoffrey Meacham cited the disappointing phase 3 data for fianlimab in metastatic melanoma as the reason for the downgrade.

Meacham said he expects shares to be under pressure given the fianlimab results.

BMO analyst Evan David Seigerman cut the price target on the stock by nearly 20% following the news.

"This was to be the defining catalyst of 1H26, with share sentiment inextricably tied to this release,” he said.