Digital health company Hims & Hers plans to offer custom versions of wildly popular weight loss shots even after supply shortages resolve, according to an investor report this week.
Hims’ stock $HIMS shot up 30% on Monday when it said it was jumping into the GLP-1 weight loss market with compounded semaglutide, an alternative product with the same active ingredient as Novo Nordisk’s drugs Ozempic and Wegovy, which have shown powerful weight loss effects. Hims’ version, made by compounding pharmacy BPI Labs, costs $199 a month — a fraction of Wegovy’s $1,350 list price.
Hims is legally able to offer the compounded shots now because the brand-name drugs are on the FDA’s drug shortage list. Normally, pharmacies can’t make large amounts of copies of commercially available drugs.
According to a May 23 note from Truist Securities, citing a recent call with the company, Hims expects to continue providing compounded semaglutide when Wegovy supply ramps up by altering the product’s formulation. Pharmacies are allowed to provide compounded drugs outside of a shortage if their formulations are at least 10% different from branded drugs, according to the note.
“We believe that there is no one-size-fits-all approach to health and wellness treatments and medical providers need a broad spectrum of solutions,” Hims said when contacted by Endpoints News. “We are continuously iterating on how to deliver customers the most personalized experience possible, and that will include building the capability for providers to prescribe doses, titrations, and combinations in order to meet the individual clinical needs of patients.”
As demand for blockbuster drugs like Wegovy and Eli Lilly’s obesity drug Zepbound has skyrocketed, another market for cheaper, compounded versions has emerged. Dozens of websites popped up to sell the off-brand drugs, catering to people without health insurance coverage for the costly brand-name shots or to those who couldn’t find them on pharmacy shelves. Hims’ rival Ro began prescribing compounded semaglutide late last year.
Pharmacists have been compounding drugs for ages, usually when an individual has an allergy to an ingredient in a commercially available drug, or another specific need. But the FDA has warned consumers about using compounded semaglutide, pointing to reports of adverse events. The FDA does not test or approve compounded drugs for safety or efficacy.
Novo Nordisk and Eli Lilly have sued a handful of businesses for how they marketed compounded GLP-1 drugs. Novo’s lawsuits generally concerned trademark infringement and false advertising.
When reached for comment about Hims’ plans to continue prescribing compounded semaglutide after the shortage, a Novo spokesperson referred to a previous statement that said Novo would “continue to pursue legal action against other entities engaged in similar behavior.”