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Difficult to say what the issue is, once larva are sick, they are probably doomed. I have been able to save sick Hyalophora larva larva using a

mixture of Oxine, a disinfectant used in animal husbandry, but it's not a perfect solution.

What causes these diseases is a mystery, clearly some environmental condition, possibly a soil or plant born pathogen.

Once animals are sick, you have to take an approach nearing sterile handling, as if in a hospital, not an easy thing to accomplish.

klar klingt Totalschaden, leider.