it only takes the first line of input, as if it is ignoring the while loop

Nope, your file only contains one line :)

You can use

use Path::Tiny qw/ path /;
dd( path( shift )->slurp_raw );
sub dd {
  use Data::Dumper;
  print Data::Dumper->new([@_])->Sortkeys(1)
    ->Indent(1)->Useqq(1)->Dump . "\n";
}
[download]

to find out what kind of line endings your files are in, then you can set $/ appropriately and there will be more than one line to read

Your other alternative is to readline n-bytes at a time, see perlvar#$/