In a stunning reversal, telehealth company Hims & Hers Health (HIMS) saw its ambitious plan to undercut Novo Nordisk in the red-hot GLP-1 market disintegrate over just three days, culminating in a massive stock selloff and a sobering lesson on the power of patents and regulation.
The company’s stock plummeted nearly 16% on February 9 and plunged another 25% in early trading on February 10 after it abruptly abandoned its scheme to sell a compounded, low-cost copycat of Novo Nordisk’s blockbuster Wegovy pill. The dramatic retreat marks a total collapse of a strategy that initially excited investors, sending the stock down over 58% in the past year.
On February 6, Hims & Hers announced what appeared to be a brilliant market raid: a compounded generic version of the newly launched oral Wegovy. Its pricing was aggressively low—$49 for the first month and $99 per month thereafter on a subscription plan, dramatically undercutting Novo Nordisk’s $149 monthly price.
Investors cheered, believing the direct-to-consumer telehealth platform could carve out a significant niche in the multi-billion dollar weight-loss drug market dominated by Novo Nordisk and Eli Lilly. The stock surged on the news, reflecting bets that Hims & Hers could democratize access through sheer price disruption.
The optimism lasted less than 24 hours. On February 7, the U.S. Food and Drug Administration (FDA) issued a stern warning, declaring its intent to restrict the supply of GLP-1 active ingredients used in non-FDA-approved compounded drugs. The agency specifically named Hims & Hers, accusing it and other compounders of “mass-marketing” unapproved alternatives.
Almost simultaneously, Novo Nordisk fired its own shot, announcing plans to sue Hims & Hers for patent infringement over its semaglutide-based product. The one-two punch of direct regulatory threat and immediate litigation from a pharmaceutical giant created a perfect storm, radically altering the battlefield.
Faced with this overwhelming pressure, Hims & Hers folded with remarkable speed. By February 8, the company announced it would “not move forward” with the copycat pill, blaming “changes in the regulatory environment.” In a defiant statement, it framed Novo’s lawsuit as “a blatant attack” and accused “big pharma” of “weaponizing the U.S. judicial system to limit consumer choice.”
The market’s verdict was severe. The stock plunged nearly 16% on February 9, wiping out the prior week’s gains.
The saga did not end with the retreat. On February 10, Novo Nordisk made its move official, filing a lawsuit that seeks not just to block the specific oral copycat, but a permanent injunction to prohibit Hims & Hers from producing or selling any compounded GLP-1 drugs containing semaglutide.
This legal strike targets the core of Hims & Hers’ recent growth engine. For the first nine months of 2025, the company’s revenue soared 74% year-over-year, driven largely by demand for its alternative weight-loss treatments, including compounded GLP-1s. Should Novo Nordisk prevail, this critical business segment could be dismantled entirely.
The final blow landed Monday morning, with shares of Hims & Hers cratering another 25% to below $9.
The 72-hour collapse of Hims & Hers’ strategy serves as a stark case study. It demonstrates that in the highly fortified pharmaceutical industry—where patent walls are high and regulatory scrutiny is intense—a low-price strategy alone is insufficient to challenge entrenched incumbents.
For Hims & Hers, the immediate financial damage is clear. However, the larger crisis may just be beginning. With the FDA’s focused scrutiny and Novo Nordisk’s sweeping lawsuit progressing, the very business model that fueled its recent meteoric growth now faces an existential threat. The company’s attempt to ride the GLP-1 wave has, for now, ended in a devastating wipeout.
