Many Clouds collapsed at the winning post after staving off King George winner Thistlecrack.
"We were just beaten by the better horse on the day, two fantastic horses ran right to the line," said Thistlecrack's trainer Colin Tizzard.
"Poor old Many Clouds. My initial thought when we got beat was that I was disappointed but it's as sad as can be.
"He was a lovely horse and he beat us on the day.
Many Clouds (right) beat Thistlecrack but died at the winning post today
Many Clouds (right) and Thistlecrack were on a trial run for the Cheltenham Festival
Many Clouds collapsed after pipping Thistlecrack to the post
"We ran our race, we're not making any excuses – today, on winter ground, we were beaten by a better horse, no question.
"They had a battle and it's just a tragic end to the race. This is what happens in our sport occasionally and you've got to face up to it."
Many Clouds won the 2015 Grand National with jockey Leighton Aspell.
Aspell brought Many Clouds level with Gold Cup favourite Thistlecrack today before pulling away in this trial for the big event.
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Nathan Horrocks, who rides Many Clouds on the gallops, told Racing UK: "It's a shock, from shouting him home to 10 minutes later he's not even with us.
"He's a massive loss for everybody, he's of huge importance to the yard but also to Lambourn and the sport.
"He captured the nation, but that is our sport – it makes us love it and hate it.
"What was great about him, and was also his downfall, was that he didn't know when to quit."