- Hims & Hers Health (HIMS) shares are nosediving in early trading, down 21% to $53.32, after the FDA declared the semaglutide shortage resolved, threatening the company’s profitable sales of compounded GLP-1 weight-loss drugs.
- The FDA’s confirmation of adequate supply from manufacturers like Novo Nordisk eliminates the regulatory basis for Hims & Hers’ compounded semaglutide offerings, a key revenue driver.
- Despite announcing a California peptide facility acquisition to enhance its personalized medicine supply chain, the news failed to mitigate the stock’s plunge amid investor focus on the GLP-1 setback.
Hims & Hers Health (HIMS) shares plummeted 21% to $53.32 in Friday morning trading, hitting an intraday low of $49.05, as the FDA announced that the shortage of semaglutide injection products – a GLP-1 medication in high demand since 2022 – has officially been resolved. This decision, based on confirmation from manufacturers like Novo Nordisk that production capacity now meets both current and projected national needs, effectively pulls the rug out from under Hims & Hers’ lucrative business of selling compounded versions of semaglutide, the active ingredient in popular weight-loss drugs like Ozempic and Wegovy. The company had capitalized on this shortage to offer affordable alternatives, significantly boosting its growth and stock value, but with the regulatory exception for compounding no longer applicable, its GLP-1 revenue stream faces an abrupt and uncertain future.
Simultaneously, Hims & Hers revealed a strategic acquisition of a California-based peptide facility, a move aimed at bolstering its supply chain and enhancing its ability to deliver personalized medications—an announcement that might have sparked optimism under different circumstances. This acquisition reflects a broader vision to verticalize operations, ensuring long-term resilience and meeting Americans’ rising demand for tailored healthcare solutions, such as treatments for weight loss, hormonal imbalances, and beyond. Yet, the market’s focus remains fixated on the FDA’s ruling, rendering this positive development a mere footnote in the day’s narrative, as the stock’s plunge suggests investors are more concerned with the immediate loss of a key revenue driver than the potential of this new asset.
The stark contrast between these two developments underscores the volatile terrain Hims & Hers navigates in the telehealth and pharmaceutical space. The company’s meteoric rise – its stock had soared nearly 110% over the last 3 months, fueled by GLP-1 sales at prices far below branded alternatives – now faces a reality check, as the resolved shortage could force a pivot or a scramble to adapt its offerings. While the peptide facility acquisition signals a proactive step toward diversification and supply chain control, it’s unlikely to offset the short-term hit from losing compounded semaglutide, a product that had become a cornerstone of its appeal to cost-conscious consumers. As the dust settles, Hims & Hers must now prove its agility in a post-shortage landscape, leveraging its new capabilities to sustain growth amid a market that’s punishing it for a regulatory shift beyond its control.
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