Novo Nordisk ended a short-lived agreement to sell its Wegovy weight-loss drug through Hims & Hers Health on Monday, sending shares of the U.S. telehealth company plunging more than 30%.
The companies engaged in an increasingly heated war of words on Monday following the Danish drugmaker’s decision to end a collaboration that started in April as part of a bundle that included Hims & Hers memberships.
Novo said it was ending its partnership over Hims’ marketing tactics and continued sales of Wegovy copies, after a U.S. judge on Friday upheld the FDA’s decision to remove semaglutide from its list of drugs in shortage. Semaglutide is the active ingredient in Wegovy, as well as Novo’s Ozempic and Rybelsus. Weight-loss drugs exploded in popularity in the last few years, and the subsequent shortages opened the doors to cheaper copies like those sold by Hims & Hers.
Hims & Hers CEO Andrew Dudum, in a post on X, accused Novo of attempting to control clinical standards at Hims & Hers to steer the company’s patients toward Wegovy.
“We refuse to be strong-armed by any pharmaceutical company’s anticompetitive demands that infringe on the independent decision making of providers and limit patient choice,” said Dudum, adding that the company will continue to sell Wegovy, as well as other treatments.
Novo did not comment on Dudum’s remarks.
The U.S. Food and Drug Administration had allowed sales of compounded versions made by pharmacies during shortages of Wegovy that began for some doses in 2023 due to that demand. But with ramped up production of weight-loss treatments by the drugmakers, the FDA set a May 22 sunset date for allowing sales of the copies.
Hims thrived due to the demand for the cheaper compounds – and the stock has swung wildly over the past several months on the outlook for its ability to sell those compounds. The company lost nearly a third of its market value on Monday, while Novo shares were down 5.3%.
Hims has continued to sell “personalized” doses of semaglutide starting at around $165 a month, saying that such sales are allowed when patients need a dose that the company does not provide.
Novo said Hims & Hers’ decision to continue selling compounded semaglutide was no longer in accordance with the law as the drug is no longer in shortage. The FDA declared the shortage over in February.
The end of the partnership could erode longer-term credibility for Hims, said Jailendra Singh, an analyst at Truist. Hims had said the collaboration with Novo and other companies was part of a plan to reach $6.5 billion in revenue by 2030.
“With the partnership seemingly over, we would anticipate a decline in traffic and adverse impact to Hims’ compounding business,” said Singh, noting that Novo’s partnerships with Hims rivals LifeMD and Ro have not been affected.
A spokesperson for Novo told Reuters that its other telehealth partners have made good-faith efforts to transition patients from copies of Wegovy to the branded option.
“Over one month into the collaboration, Hims & Hers Health, Inc has failed to adhere to the law which prohibits mass sales of compounded drugs under the false guise of ‘personalization’ and are disseminating deceptive marketing,” the spokesperson said.
(Reporting by Stine Jacobsen, Louise Breusch Rasmussen, Bhanvi Satija and Amina Niasse)
