End to tirzepatide shortage has read on Hims GLP-1 trajectory, says Leerink

Leerink notes that the FDA today declared an end to the tirzepatide shortage, which “seemingly begins the process of bringing the compounded GLP-1 market back to ‘normal’ behavior.” The direct read is obviously for Eli Lilly’s (LLY) Zepbound, but the firm also thinks a key focus point remains the future trajectory of Hims & Hers’ (HIMS) GLP-1 strategy. The firm, which reminds investors that, at this point, Hims does not sell a compounded version of tirzepatide but rather sells semaglutide, a compounded version of Novo’s (NVO) Ozempic/Wegovy, believes that the resolved tirzepatide shortage likely signals an eventual resolution of the semaglutide shortage as well. The firm, which believes that Hims has an effective business model to drive integrated/captive pharmacy prescriptions and dispensing, but adds that the “push and pull on stock volatility tied to GLP-1 headlines have made finding the fundamental value challenging,” maintains a Market Perform rating on Hims & Hers shares.