KEY POINTS
- Hims & Hers launched a $49 monthly compounded weight-loss pill, shaking up the GLP-1 drug market.
- Stock initially spiked on news but closed lower and continued falling after FDA and legal concerns surfaced.
- Novo Nordisk criticised the product as ineffective and plans legal action against the competing offer.
Online telehealth firm Hims & Hers Health introduced a low-cost compounded version of a popular weight-loss pill.
Priced at $49 for the initial month, the monthly cost rises to about $99 after the introductory period.
The pill contains a compounded form of semaglutide, the active ingredient in Novo Nordisk’s FDA-approved Wegovy drug.
Investors reacted strongly when the launch was announced on Thursday.
Shares initially jumped as traders responded to the price disruption news.
However, the stock declined 4% by market close and fell further in after-hours trading.
Part of the selloff followed warnings from the U.S. Food and Drug Administration about similar “copycat” drugs.
FDA leadership indicated regulators may take swift action against unapproved products that resemble approved medicines.
This contributed to investor concern about regulatory risks tied to the Hims product.
Novo Nordisk’s leadership strongly criticised the Hims offering this week.
The Danish drugmaker’s CEO called the cheaper pill a “waste of money” and not equivalent to its branded Wegovy due to proprietary formulation technology.
Novo also disclosed plans to pursue legal action over the competing product.
The competitive dynamics in the weight-loss drug market have intensified.
The lower price option from Hims comes amid strong demand for GLP-1 treatments and price sensitivity among consumers.
Rival companies including Eli Lilly have seen share prices swing on the news.
Trading activity around Hims & Hers shares was high on the day of the announcement.
Market watchers noted this was the busiest session in several months.
Despite early enthusiasm, many investors opted to sell on profit-taking or risk concerns.
The company’s volatility in recent years also shaped investor behaviour.
Shares have swung widely following earlier partnerships and compounding drug strategies.
Some short-sellers have positioned heavily against the stock amid uncertainty.
Hims & Hers defended the safety and accessibility of its compounded pill offering.
The firm said the product is guided by clinical recommendations for personalized treatments.
However, critics point to the lack of formal FDA approval for compounded versions as a major concern.
Healthcare analysts see the episode as symptomatic of broader pricing and access debates.
Lower-cost alternatives attract patient interest but raise questions about regulatory compliance.
How the FDA and courts respond could influence the wider obesity drug market.
The near-term outlook for Hims & Hers stock remains mixed.
Continued legal and regulatory scrutiny may lead to further trading volatility.
Market sentiment will likely hinge on emerging clarity around compounded drug rules.
