The FDA's recent reversal on compounded semaglutide pills has sent shockwaves through the telehealth industry, with Hims & Hers Health (HIMS) at the center of the controversy.
The Background
Compounded semaglutide has been a major growth driver for HIMS. The company has been offering compounded versions of the popular GLP-1 weight loss medication at significantly lower prices than brand-name Ozempic and Wegovy from Novo Nordisk.
The FDA's Position
The FDA initially indicated that compounded semaglutide pills could continue under certain conditions. However, recent guidance has created uncertainty around the legality and future of these products.
Impact on HIMS
Revenue at Risk: GLP-1 products have become a significant revenue contributor for HIMS, driving much of the company's recent growth acceleration.
Margin Pressure: Compounded semaglutide products carry different margin profiles than traditional telehealth offerings.
Legal Exposure: The regulatory uncertainty opens HIMS to potential legal challenges from Big Pharma players like Novo Nordisk.
Novo Nordisk Strikes Back
As of February 2025, Novo Nordisk has filed a lawsuit against HIMS, marking a significant escalation in the battle over compounded GLP-1 medications. HIMS has responded forcefully, calling the lawsuit an attack on "a well-established, vital component of US pharmacy practice."
What to Watch
- FDA Final Guidance: The agency's final position will determine the viability of HIMS's GLP-1 business
- Legal Proceedings: The outcome of Novo's lawsuit could set precedent for the entire compounding industry
- Revenue Diversification: Whether HIMS can offset potential GLP-1 losses with other products
The Bottom Line
HIMS finds itself at the intersection of healthcare innovation, regulatory uncertainty, and Big Pharma interests. The company's response to these challenges will determine whether its remarkable growth trajectory can continue.
This is a developing story. Check back for updates.
HIMS