Online telehealth company Hims & Hers Health has begun offering a low-cost, compounded oral version of Novo Nordisk’s Wegovy, intensifying competition in the booming weight-loss drug market and drawing swift backlash from both investors and the drug’s maker.
The company said on Thursday it is introducing the compounded pill at an introductory price of $49 for one month, with the cost rising to $99 per month for customers who commit to a five-month plan and pay upfront. A three-month subscription carries a higher monthly price. By contrast, Novo Nordisk plans to sell its FDA-approved oral Wegovy for $199 per month, without a subscription.
The move immediately rattled Wall Street. Novo Nordisk shares fell 8.6%, while Eli Lilly shares dropped about 6%, reflecting investor concerns that cheaper compounded alternatives could undermine the branded drugmakers’ pricing strategies in the U.S. consumer market.
Novo Nordisk said it would pursue legal action against Hims, arguing that the telehealth company’s product infringes on its intellectual property and raises patient safety concerns. The Danish drugmaker also stressed that only Novo can legally sell the Wegovy pill using its proprietary absorption technology.
“The action by Hims & Hers is illegal mass compounding that poses a significant risk to patient safety,” said Ambre James-Brown, a Novo Nordisk spokesperson. “Novo Nordisk will take legal and regulatory action to protect patients, our intellectual property and the integrity of the U.S. gold-standard drug approval framework.”
Pricing pressure intensifies
The announcement comes amid mounting pressure on Novo’s weight-loss business. A day earlier, the company warned that pricing pressure on its obesity medicines had reached unprecedented levels and cut its full-year forecast. Novo shares on Thursday touched their lowest level since mid-2021.
Novo’s newly launched oral Wegovy has seen strong early demand in the U.S., where it is sold directly to consumers through a cash-pay website. Still, the rise of compounded alternatives continues to challenge branded manufacturers.
Hims previously received permission from the U.S. Food and Drug Administration to sell compounded versions of Novo’s GLP-1 injectable drugs during periods of shortage. Since then, the company has marketed what it describes as “personalized” formulations, offering different doses or regimens from those sold by branded drugmakers.
“The status quo for months now has been that a compounder can create a copycat version of a branded drug, as long as they make some kind of minor tweak they argue benefits specific patient groups,” said Michael Nedelcovych, an analyst at TD Cowen.
Hims argues for patient choice
Hims says its compounded oral treatment is designed for patients who experience side effects, prefer a pill over injections, or want a more affordable option. Semaglutide, the active ingredient in Wegovy and Ozempic, is also used in the compounded version.
“We’re excited to find ways to continue bringing branded treatments to the platform across specialties,” said Andrew Dudum, chief executive of Hims & Hers. “More choice on the platform is the best thing for customers everywhere.”
Patent attorney Gaston Kroub, based in New York, said Hims is positioning the oral product as a personalized alternative, potentially stretching the boundaries of what is permitted under FDA compounding rules.
“Hims has shown a willingness to go as close to the line as possible,” Kroub said. “It’s a strategy of testing whether anyone is going to push back.”
Regulatory and legal risks remain
Novo executives have repeatedly voiced frustration over what they describe as the continued mass marketing of unapproved products. Chief Financial Officer Karsten Munk Knudsen said the issue ultimately lies with regulators and lawmakers.
“Predicting if and when the tide turns is really hard,” Knudsen said, referring to the fast-growing compounding market.
The dispute also revives tensions between the two companies. Novo and Hims previously partnered to offer injectable Wegovy, but that relationship ended after Novo accused Hims of improperly marketing versions of its drug. Dudum has countered that Novo was attempting to exert undue control over clinical decisions made by Hims physicians.
Compounding pharmacies are allowed in the U.S. to create customized medicines for individual patients, including modified versions of existing drugs. The practice has expanded rapidly, even as branded versions of semaglutide have become more widely available.
The FDA has already scrutinized Hims’ marketing. In September, the agency warned the company that claims such as “same active ingredient as Ozempic and Wegovy” could be misleading, noting that compounded drugs are not FDA-approved.
Hims said its growing scale helps keep prices down. The company doubled the size of its facility in New Albany, Ohio, and said the expansion enables it to offer treatments at lower cost.
Meanwhile, competition is expected to intensify further, with Eli Lilly preparing to launch its own oral weight-loss pill in the coming months, setting the stage for a high-stakes battle over pricing, access, and regulation in the obesity drug market.
