Hims & Hers Stock Plunges After Weight Loss Drug Deal Fallout

• Hims & Hers Health Inc. (HIMS) shares dropped 25.41% to $47.90 in premarket trading after Novo Nordisk (NVO) terminated direct access to Wegovy via the NovoCare Pharmacy.
• The ended collaboration, announced Monday, disrupts Hims & Hers’ ability to sell Novo’s weight-loss drug, which had driven a 90% revenue increase in its GLP-1 offerings in Q3 2024.
• Novo Nordisk’s move may reflect efforts to control Wegovy’s distribution amid pricing pressures and competition, while Hims & Hers faces challenges in sustaining its weight-loss segment growth.

Hims & Hers Health Inc. (HIMS) experienced a significant sell-off, with shares plummeting 25.41% to $47.90 in premarket trading on Monday, following Novo Nordisk’s (NVO) decision to end direct access to its blockbuster weight-loss drug Wegovy through the NovoCare Pharmacy. The abrupt termination of this partnership, announced by Novo Nordisk on Monday, marks a setback for Hims & Hers, which had positioned itself as a key distributor of Wegovy to expand its presence in the booming weight-loss market.

The collaboration, initially unveiled in April, allowed Hims & Hers to offer Wegovy as part of a bundled package on its telehealth platform, capitalizing on the surging demand for GLP-1 receptor agonists like Wegovy, which have transformed obesity treatment. Novo Nordisk’s decision to halt this arrangement underscores the competitive and complex dynamics of the pharmaceutical distribution landscape, where manufacturers tightly control access to high-demand medications. By severing direct access via NovoCare Pharmacy, Novo Nordisk effectively limits Hims & Hers’ ability to offer Wegovy at scale, potentially redirecting patients to alternative channels or Novo’s own distribution networks.

The market’s reaction reflects investor concerns about Hims & Hers’ reliance on its weight-loss segment, which has been a significant growth driver. In Q3 2024, Hims & Hers reported a 90% year-over-year revenue increase in its GLP-1 offerings, largely fueled by Wegovy and compounded semaglutide formulations. The loss of direct Wegovy access could crimp this momentum, particularly as Hims & Hers faces competition from other telehealth providers and pharmacies vying for a share of the weight-loss market, projected to reach $150 billion globally by 2030. Additionally, Hims & Hers’ plans to continue selling compounded versions of semaglutide, as noted in industry reports, may face heightened regulatory risks, given the FDA’s ongoing efforts to curb unapproved formulations.

Novo Nordisk’s move may also signal strategic recalibration amid broader industry pressures. The company has faced challenges in pricing challenges, having slashed Wegovy’s price by more than half in March 2025, to counter competition and maintain market leadership against rivals like Eli Lilly (LLY) and its drug, Zepbound. By tightening control over Wegovy’s distribution, Novo Nordisk could be aiming to protect its brand integrity and profitability, particularly as it navigates supply chain constraints that have intermittently limited Wegovy’s availability since its 2021 U.S. approval.

For Hims & Hers, the path forward involves pivoting to mitigate the impact of this partnership loss. The company’s telehealth model, which emphasizes affordability and convenience, remains a competitive advantage, and it may seek alternative partnerships or double down on other therapeutic areas like men’s health and dermatology, which comprised 40% of its 2024 revenue. However, rebuilding investor confidence will hinge on Hims & Hers’ ability to demonstrate resilience in its weight-loss strategy without direct access to Wegovy access.

This development highlights the volatility of partnerships in the fast-evolving healthcare sector, where access to high-value drugs like Wegovy can make or break a company’s growth trajectory. While Hims & Hers has benefited from the telehealth boom, its sharp stock decline underscores the risks of over-reliance on a single product or partner. As the weight-loss market continues to expand, both Hims & Hers and Novo Nordisk will need to navigate a landscape shaped by innovation, regulation, and fierce competition.

WallStreetPit does not provide investment advice. All rights reserved.

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