What happened

For the second trading day in a row, investors sold off shares of ProQR Therapeutics (PRQR 6.84%). The clinical-stage biotech's shares were hit by a series of analyst downgrades and price target cuts in the wake of the company's latest report about a once-promising drug candidate. The stock closed Monday's session down by 10.1%.

So what

On Friday, ProQR published a dispiriting update about sepofarsen, a drug candidate that it hoped would successfully treat a type of Leber congenital amaurosis, an eye disorder. In a phase 2/3 clinical trial, sepofarsen not only failed to meet its primary endpoint, it also failed to meet any notable secondary endpoints.

$100 bill being cut by a pair of scissors.

Image source: Getty Images.

The following day, analysts tracking ProQR stock were quick to slice their expectations for its performance. Three prognosticators -- Yigal Nochomovitz of Citigroup, Steven Seedhouse of Raymond James, and Dae Gon Ha of Stifel -- all downgraded their ratings on the biotech from the equivalents of buy (or strong buy, in Seedhouse's case) to neutral.

ProQR shares also got price target haircuts from these analysts. By far the most drastic of these was from Citigroup's Nochomovitz, who now feels the stock will only be selling for $1.70 per share a year from now -- far below his previous $37 per share target.

Now what

These analysts expressed surprise that sepofarsen flopped as badly as it did in the clinical trial. In a new note, Seedhouse wrote that "it is totally unclear to us what went wrong" between the previous, rather promising, clinical trial of the drug and the dismal result reported by ProQR on Friday.

"We expect clarity will be forthcoming but just aren't sure when and to what extent it will add confidence that there is limited readthrough to the rest of the company," the Raymond James analyst added.