Alumis shares were pacing toward their worst day on record Tuesday after the biotech said its lupus drug candidate, envudeucitinib, failed to meet the main goal of a mid-stage trial.

Researchers were probing the oral treatment's efficacy in patients with moderate-to-severe systemic lupus erythematosus $(SLE)$, a chronic disease where the body's immune system mistakenly attacks its own healthy tissues and organs.

Alumis specifically tested envudeucitinib in 408 patients over 48 weeks to determine if it could improve symptoms. However, the trial failed to meet its primary goal of reducing disease activity as well as secondary targets including key measures of efficacy and tolerability.

Shares cratered 58% to $9.12 on Tuesday, putting them on track for their largest single-day percentage drop on record and their lowest close since early January, according to Dow Jones Market Data.

Envudeucitinib targets an enzyme called tyrosine kinase 2 to downregulate key inflammation-promoting proteins, including Type I Interferon, Interleukin-23, and Interleukin-17. By blocking these pathways, the is meant to calm an overactive immune system and reduce inflammation.

However, a specific subgroup responded well to the treatment. Alumis noted that participants with elevated interferon activity, a biomarker linked to lupus severity, showed "robust clinical responses."

These patients, who are thought to respond better to therapies like envudeucitinib, represented a smaller portion of the trial population than anticipated, which Alumis believes contributed to the overall trial miss.

Despite the setback, the biotech isn't scrapping plans for a late-stage trial, saying it intends to discuss the data with regulators. Alumis added that it remains on track to file for regulatory approval of the drug for moderate-to-severe plaque psoriasis in the fourth quarter.