Hims Faces Off with Novo Nordisk in Explosive GLP-1 Drug War

Weight-loss drug lawsuit intensifies market competition between telehealth platforms and pharmaceutical giants over compounded medications

Key Takeaways

• Hims shares recover from 3% decline to minor 0.2% loss as company releases clinical data showing 10.3% average weight loss for compounded GLP-1 users over six months.
• Novo Nordisk stock plunges 20% after revising 2025 sales growth forecast to 8-14% from 13-21%, citing competition from compounded GLP-1 medications and potential legal action against Hims.
• Two class action lawsuits filed June 25, 2025 against Hims targeting investors from April 29 to June 23, alleging misleading statements about compounding practices and Novo Nordisk partnership.

Introduction

Hims & Hers Health faces mounting pressure from pharmaceutical giant Novo Nordisk as the Danish drugmaker threatens legal action over compounded weight-loss medications. The telehealth company’s shares initially dropped over 3% Tuesday morning before recovering to near-flat territory following the release of clinical data supporting its GLP-1 treatments.

The conflict centers on Hims’ sale of compounded semaglutide, a cheaper alternative to Novo’s branded Wegovy. This dispute highlights broader tensions between traditional pharmaceutical companies and digital health platforms offering personalized medication solutions.

Key Developments

Novo Nordisk revised its full-year outlook downward, projecting 2025 sales growth of 8-14% compared to previous estimates of 13-21%. The company attributes this reduction to persistent competition from compounded GLP-1 medications despite the expiration of federal shortage allowances.

The pharmaceutical giant terminated its partnership with Hims last month, accusing the company of violating laws prohibiting mass sales of compounded drugs under false personalization claims. Novo states that Hims “failed to adhere to the law” and engaged in “deceptive marketing that put patient safety at risk.”

In response, Hims released clinical data showing users of its compounded treatments achieved an average 10.3% body weight reduction over six months with minimal side effects. The company maintains its practices comply with FDA regulations through licensed 503B compounding pharmacies.

Market Impact

Novo Nordisk shares tumbled more than 20% following the earnings revision, marking a 37% decline year-to-date. The company also reduced operating profit growth forecasts to 10-16% from 16-24% previously.

Hims shares demonstrate volatility amid the legal uncertainty, though the stock has generated substantial returns for investors over recent quarters. The company’s Q1 2025 revenue surged 111% year-over-year to $586 million, driven primarily by GLP-1 demand.

The broader telehealth sector shows mixed reactions as investors weigh growth potential against regulatory risks. Compounded medication providers face particular scrutiny following FDA orders for some pharmacies to cease production of copycat weight-loss drugs.

Strategic Insights

The dispute reveals fundamental tensions between established pharmaceutical companies protecting branded drug revenues and emerging digital health platforms offering cost-effective alternatives. Novo’s aggressive stance suggests concern over market share erosion in the lucrative weight-loss segment.

Hims demonstrates resilience through platform diversification, expanding into menopause care and international markets via its ZAVA acquisition. The company’s European presence across the UK, Germany, and Ireland provides geographic risk mitigation.

Traditional pharmaceutical companies increasingly view compounding pharmacies as competitive threats rather than complementary services. This shift creates regulatory and legal challenges for telehealth platforms relying on compounded medications for growth.

Expert Opinions and Data

Hims CEO Andrew Dudum characterizes Novo’s actions as anticompetitive tactics designed to force customers toward Wegovy. He argues the company’s personalized approach through telehealth consultations justifies compounded medication use.

According to Investing.com, analysts express mixed sentiment regarding Hims’ long-term prospects amid regulatory uncertainty. The company maintains strong financial metrics with 2.4 million subscribers generating $84 monthly revenue per user.

Industry observers note the FDA’s evolving position on compounded medications creates ongoing compliance challenges. The agency’s recent orders targeting specific compounding pharmacies signal increased enforcement activity.

Novo Nordisk announced leadership changes with Maziar Mike Doustdar becoming CEO in August, succeeding Lars Fruergaard Jorgensen amid the company’s recent performance challenges.

Conclusion

The conflict between Hims and Novo Nordisk represents broader industry dynamics as digital health platforms challenge traditional pharmaceutical distribution models. Legal proceedings and regulatory scrutiny create near-term uncertainty for compounded medication providers.

Hims maintains strong financial performance with aggressive growth targets, projecting $2.3-2.4 billion revenue for 2025. However, the company faces significant legal exposure through pending class action lawsuits and potential action from Novo Nordisk over compounding practices.