Novo Nordisk Cuts Wegovy Deal, Triggers Massive Selloff in Hims & Hers
June 23 - Shares of Hims & Hers Health (NYSE:HIMS) dropped about 30% on Monday after Novo Nordisk (NVO) said it would discontinue its collaboration with the telehealth firm, cutting off access to its weight loss drug, Wegovy, via NovoCare Pharmacy.
Warning! GuruFocus has detected 5 Warning Sign with HIMS.
The partnership began in late April after the U.S. Food and Drug Administration said Wegovy supply constraints had eased. Novo Nordisk then opened direct channels to Wegovy through select telehealth providers, including Hims & Hers.
However, Novo Nordisk said its internal review raised red flags. The company alleged Hims & Hers failed to meet legal standards around compounded drugs, accusing it of offering mass-produced treatments under the pretense of personalized care.
Executives at Novo Nordisk warned they would act against partners engaged in illegal compounding practices that risk patient safety. The company added that some compounded semaglutide products sourced by telehealth firms used unapproved ingredients from Chinese suppliers.
Citing Brookings Institute research, Novo Nordisk noted that the FDA has neither approved the manufacturing practices nor reviewed the quality of semaglutide from these sources.
The decision marks a sharp blow for Hims & Hers, which had leaned into weight-loss offerings as part of its growth strategy.
This article first appeared on GuruFocus.
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Forbes
an hour ago
- Forbes
Hims & Hers CEO No Longer A Billionaire After Novo Nordisk Deal Collapses
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Yahoo
2 hours ago
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Hims & Hers stock drops after Wegovy manufacturer ends deal to distribute weight loss drug
Novo Nordisk has announced it is ending its distribution collaboration with US telehealth firm Hims & Hers Health over the popular weight-loss drug, Wegovy. The Danish pharmaceutical giant and Hims & Hers had initially partnered in April, with plans for the telehealth company to offer Wegovy as part of a bundled package on its platform. Despite the halt, Hims & Hers stated earlier this month that it intends to continue selling "personalised" doses of Wegovy, priced from approximately $165 a month. This approach, according to Hims, is permissible under clinical guidelines, citing reasons such as reduced side effects. Hims also provides liraglutide, a generic version of an older Novo Nordisk diabetes medication known for its weight-loss effects, alongside branded Wegovy and Eli Lilly's competing drug, Zepbound. Wall Street analysts have questioned whether Hims' offerings actually qualify as "personalized" and say it is unclear if Novo, which has said mass production of copies is breaking the law, will allow it. Hims & Hers was not immediately available for a comment outside of the company's regular work hours. A U.S. federal judge on Friday rejected a bid by compounding pharmacies to allow them to continue making copies of Novo Nordisk's weight-loss drugs Ozempic and Wegovy, upholding the U.S. Food and Drug Administration's decision to remove the drugs' active ingredient, semaglutide, from the shortage list. "Efforts will continue to make authentic, FDA-approved Wegovy directly available through NovoCare Pharmacy to select telehealth organizations that share our commitment to safe and effective medical treatment for patients," Novo said. Novo's share price fell following the announcement, extending an earlier decline to trade down 6.5% by 1315 GMT. Shares of Hims and Hers fell 22% to $50.02 in U.S. premarket hours.
