Oscar Time, the 2011 Grand National runner-up, has been ruled out for the rest of the season with a leg injury.
"He just has a slight tendon injury," said trainer Martin Lynch. "It's nothing huge, but it's enough to keep him out for the season."
"Terrible News," Waley-Cohen tweeted. "GN dream hits rocks! Gutted for horse & all connected."
Oscar Time, owned by Waley-Cohen's father Robert, had so far produced good form over the winter, with a creditable fourth place finish over the hurdles at Thurles in November.
"He'd been in tremendous form since his run over hurdles," added Lynch. "Even better than he was this time last year, if anything.
"He's a horse we've minded during his career, so hopefully he'll be back next season.
"He just has a slight tendon injury. It's a big blow but it's not career-threatening and the main thing is he's still in one piece."
With the Grand National no longer possible, Lynch suggested that next year's Foxhunter Chase at the Cheltenham Festival would be his next big target before another attempt at Aintree.
"We'll obviously make plans nearer the time," added Lynch. "But there's a possibility he could go down the hunter chase route and go to the Cheltenham before he goes back to Aintree.
"It's all up in the air at the minute."
Robert Waley-Cohen added: "It's unfortunate. It just shows you how difficult it is just to get horse and jockey to the races at the top of their game.
"We were looking forward to running in the Bobbyjo Chase at Fairyhouse as we wanted to get another run into him before Aintree, but we're going to run out of time.
"He's lightly raced and it's not unheard of for a 12-year-old to win the National, so hopefully he'll still be up to it next year. Fingers crossed."