Hims & Hers' stock plunges. Here's why Wegovy parent ended its partnership with the company.
By Steve Gelsi
Wegovy maker Novo Nordisk cuts ties with Hims & Hers, alleging 'deceptive promotion and selling of illegitimate, knockoff versions' of the weight-loss drug
Hims & Hers Health Inc.'s stock booked record losses Monday after pharmaceutical giant Novo Nordisk, maker of the weight-loss drug Wegovy, said it was ending a collaboration with the telehealth company less than two months after it started.
Novo Nordisk said in a prepared statement that it had ended its collaboration with Hims & Hers due to "deceptive promotion and selling of illegitimate, knockoff versions of Wegovy that put patient safety at risk."
Hims & Hers Chief Executive Andrew Dudum said on X that Novo Nordisk is "misleading the public" and that it pressured his company to "control clinical standards and steer patients to Wegovy regardless of whether it was clinically best for patients."
Dudum said Hims & Hers refuses to be "strong-armed by any pharmaceutical company's anticompetitive demands that infringe on the independent decision-making of providers and limit patient choice."
Hims & Hers added that it will "continue to offer access to a range of treatments, including Wegovy, to ensure providers can serve the individual needs of patients."
Hims & Hers' stock (HIMS) sank 34.6% Monday, its largest one-day loss since the company went public in September 2019. The losses surpassed the stock's previous record selloff of 25.8% on Feb. 21, according to FactSet data.
Denmark-based Novo Nordisk's U.S.-listed shares (NVO) (DK:NOVO.B) slumped 5.5% Monday.
Novo Nordisk's move comes after the Food and Drug Administration in May ended a drug-shortage declaration for weight-loss drugs, in a move that was intended to curb generic versions of the drugs that had been used to fulfill demand.
Novo Nordisk had inked the partnership with Hims & Hers partly to help distribute its Wegovy drug as a branded alternative to generics.
Hims & Hers, however, has continued to offer generic versions of the drugs under a loophole in the FDA rules that allows individual, personalized treatments for some patients using generic drugs, noted Michael Schnell, a director at consulting firm West Monroe.
The FDA could step in and close that loophole - a move that would deliver an additional blow to Hims & Hers' business, he said.
The disagreement between Novo Nordisk and Hims & Hers "is a bad look" for both parties, Schnell added, due to the collapse of the partnership within just a couple of months of their pact.
After the collaboration was announced on April 29, Hims & Hers shares had rocketed 125.5% through Friday, while Novo Nordisk shares had climbed 17.8%.
Also read: Hims & Hers' stock soars after company teams up with Wegovy maker
Novo Nordisk said direct access to Wegovy will no longer be available to Hims & Hers clients through its NovoCare Pharmacy. The company noted that "knockoff" weight-loss drugs are made with "foreign illicit active pharmaceutical ingredients."
Ingredients in the drugs "sold by telehealth entities and compounding pharmacies are manufactured by foreign suppliers in China," it said.
Novo Nordisk has been competing on weight-loss drugs with Eli Lilly & Co., which recently made all doses of Zepbound available for $499 a month as a price war between the companies continues.
Eli Lilly shares (LLY) fell 1% onMonday.
-Steve Gelsi
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06-23-25 2014ET
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