Hims & Hers shares plunge as FDA clears weight-loss drug shortage
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Ozempic and Wegovy, the popular GLP-1 drugs for diabetes and weight loss, are no longer in short supply, the FDA declared Friday.
Why it matters: That's good news for Novo Nordisk (whose stock rose 5% Friday) and potentially bad news for Hims & Hers (which fell 26%).
Between the lines: Novo makes Ozempic and Wegovy, while Hims has been making quite a bit of money offering copycat versions of the drugs in the U.S. for a fraction of the price.
- The legal ability to sell these "compounded" versions of brand-name drugs relies, in large part, on the FDA's shortage designation.
State of play: That's setting up a potential standoff between Novo and Hims, who recently traded barbs after Hims' Super Bowl ad touting its alternative GLP-1s.
Friction point: Compounders now have 60 or 90 days, depending on their facility, to stop making drugs that are "essentially a copy" of Novo's products, the FDA said today.
- Yes, but: Hims says it will continue to offer compounded semaglutide, the main ingredient in Ozempic and Wegovy.
- It says despite the lift of the shortage designation, the FDA still allows compounding in the case of a "clinical need," such as when a patient has an allergy to a certain dye contained in a drug or cannot take it in its current form.
Novo, meanwhile, said the FDA's decision means that making or selling a knockoff compounded drug that is essentially a copy of Ozempic or Wegovy is illegal, under compounding laws, with "rare exceptions."
What we're watching: the strength of Hims' argument to keep legally selling personalized doses.
