Hims & Hers, a popular telehealth company, has recently seen its stocks plummet after a bombshell partnership exit from pharmaceutical giant Novo Nordisk.
The update, which comes as a shock for the current pharmaceutical scene, follows Novo Nordisk's allegations that Hims & Hers released counterfeit products and engaged in deceptive marketing practices.
What Novo Nordisk is Alleging
In a recent press release, Novo Nordisk stated it is cutting Hims & Hers off from access to its obesity medication Wegovy through NovoCare Pharmacy. The decision follows Hims & Hers' failure to comply with US laws prohibiting mass sales of compounded drugs falsely marketed as personalised treatments, which Novo Nordisk claims compromises patient safety.
Dave Moore, Executive Vice-President of Novo Nordisk's US operations, said, 'We will work with telehealth companies to provide direct access to Wegovy® that share our commitment to patient safety—and when companies engage in illegal sham compounding that jeopardises the health of Americans, we will continue to take action.'
What's The Deal With Wegovy–and Why Hims 'Screwed' Up
Wegovy is a prescription medication developed by Novo Nordisk. Its active ingredient is semaglutide, a GLP-1 receptor agonist originally used in the diabetes drug Ozempic.
As the supplement went viral, Novo Nordisk experienced a nationwide shortage starting in August 2022. The surge in demand and supply chain limitations led many patients to seek out compounded versions of semaglutide from telehealth providers and compounding pharmacies. However, in February this year, the FDA officially declared the Wegovy shortage resolved, confirming that Novo Nordisk was now meeting current and projected demand.
In its latest callout, Novo Nordisk alleged that some telehealth and compounding entities, including Hims & Hers, used illicit semaglutide sourced from unregulated Chinese manufacturers not approved or inspected by the FDA.
'Novo Nordisk is firm on our position and protecting patients living with obesity. When patients are prescribed semaglutide treatments by their licensed healthcare professional or a telehealth provider, they are entitled to receive authentic, FDA-approved and regulated Wegovy,' Dave added.
How's Hims & Hers' Stock Now?
Hims & Hers Health stock suffered a dramatic decline following Novo Nordisk's decision to terminate their partnership. Shares plunged roughly 30%, from around $64 to the low $40s, marking the steepest one-day drop in the company's history.
The partnership, launched just two months earlier to bundle Wegovy sales via Hims's platform, fueled a 125% rise in the stock—only to reverse sharply on the fallout.
Analysts: From 'Hold' to 'Buy'
Following the news, market analysts Needham downgraded Hims & Hers' stock from 'Buy' to 'Hold'. Despite a 165% gain this year and strong revenue growth, Needham removed the telehealth company from its Conviction List due to legal and regulatory risks tied to its continued sale of personalised GLP-1 drugs.
They also noted that the company may face lawsuits or FDA action, as rivals like Lilly and Novo Nordisk now back competing telehealth firms. While its weight loss revenue may not vanish immediately, analysts expect the stock to stay flat until the legality of its business practices is clarified.
With legal uncertainty looming and investor confidence shaken, the future of Hims & Hers' weight loss business—and its stock performance—will depend heavily on how it navigates regulatory scrutiny and rebuilds trust in a rapidly evolving healthcare landscape.
