Hims & Hers Stock (HIMS) Collapses 30% After Novo Nordisk Pulls Wegovy Deal on Safety Fears

Shares in telehealth group Hims & Hers (HIMS) shed 30% today after pharmaceuticals giant Novo Nordisk (NVO) ended its collaboration deal on patient safety fears.

Supply Terminated

Novo Nordisk announced today that it will no longer be working with Hims & Hers Health, and that direct access to its weight loss drug Wegovy® will be terminated.

Novo Nordisk in April said it would offer Wegovy through several telehealth companies, such as Hims & Hers, to expand access to the blockbuster injection now that it is no longer in short supply in the U.S.

However, it said today that it had decided to end the one-month-long collaboration with Hims & Hers due to concerns about its “failure to adhere to the law, which prohibits mass sales of compounded drugs under the false guise of ‘personalization,’ and its dissemination of deceptive marketing that puts patient safety at risk.”

It will continue to make Wegovy directly available through NovoCare Pharmacy to select telehealth organizations that “share our commitment to safe and effective medical treatment for patients living with chronic diseases.”

Patient Protection

“Novo Nordisk is firm in our position of protecting patients living with obesity. When patients are prescribed semaglutide treatments by their licensed healthcare professional or a telehealth provider, they are entitled to receive authentic, FDA-approved and regulated Wegovy,” said Dave Moore, Executive Vice President, US Operations of Novo Nordisk Inc. “When companies engage in illegal sham compounding that jeopardizes the health of Americans, we will continue to take action.”

Novo said that, based on an investigation, the “semaglutide” active pharmaceutical ingredients that are in knock-off drugs sold by telehealth companies and compounding pharmacies are manufactured by foreign suppliers in China.

A Hims & Hers spokesperson did not immediately respond to requests for comment from media outlets such as CNBC.

Is HIMS a Good Stock to Buy Now?

On TipRanks, HIMS has a Hold consensus based on 2 Buy, 7 Hold and 2 Sell ratings. Its highest price target is $68. HIMS stock has a consensus price target of $42.09 implying a 9.03% downside.