The antiparasitic drug ivermectin was proposed as a repurposed drug for the treatment of SARS-CoV-2 infection based on in vitro studies, but proved ineffective in high-quality clinical trials. When exploring possible reasons for this disconnect, we found that ivermectin interferes with AlphaScreen assays by quenching singlet oxygen transmission, calling into question the original justifications for pursuing ivermectin as an antiviral agent. Furthermore, at the low micromolar concentrations where ivermectin reduced SARS-CoV-2 viral burden in vitro, ivermectin decreased cell viability, modified membrane bilayer properties, and nonspecifically dysregulated membrane protein functions. In this Perspective, we provide molecular-level rationale for why ivermectin, an effective and safe antiparasitic drug at low nanomolar concentrations, becomes cytotoxic at low micromolar concentrations and, in turn, why ivermectin has not translated into an effective antiviral agent. We highlight lessons learned from the failed ivermectin repurposing effort and provide a workflow for identifying membrane-perturbing bioactivity early in drug development.