Hims & Hers stock drops after Wegovy manufacturer ends deal to distribute weight loss drug

Hims & Hers had partnered with the Danish pharmaceutical giant in April to sell Wegovy

Novo Nordisk has announced it is ending its distribution collaboration with US telehealth firm Hims & Hers Health over the popular weight-loss drug, Wegovy.

The Danish pharmaceutical giant and Hims & Hers had initially partnered in April, with plans for the telehealth company to offer Wegovy as part of a bundled package on its platform.

Despite the halt, Hims & Hers stated earlier this month that it intends to continue selling "personalised" doses of Wegovy, priced from approximately $165 a month. This approach, according to Hims, is permissible under clinical guidelines, citing reasons such as reduced side effects.

Hims also provides liraglutide, a generic version of an older Novo Nordisk diabetes medication known for its weight-loss effects, alongside branded Wegovy and Eli Lilly’s competing drug, Zepbound.

Hims & Hers stated intends to continue selling "personalised" doses of Wegovy

Wall Street analysts have questioned whether Hims' offerings actually qualify as "personalized" and say it is unclear if Novo, which has said mass production of copies is breaking the law, will allow it.

Hims & Hers was not immediately available for a comment outside of the company's regular work hours.

A U.S. federal judge on Friday rejected a bid by compounding pharmacies to allow them to continue making copies of Novo Nordisk's weight-loss drugs Ozempic and Wegovy, upholding the U.S. Food and Drug Administration's decision to remove the drugs' active ingredient, semaglutide, from the shortage list.

"Efforts will continue to make authentic, FDA-approved Wegovy directly available through NovoCare Pharmacy to select telehealth organizations that share our commitment to safe and effective medical treatment for patients," Novo said.

Novo's share price fell following the announcement, extending an earlier decline to trade down 6.5% by 1315 GMT. Shares of Hims and Hers fell 22% to $50.02 in U.S. premarket hours.