You know that friend who always thinks they can hack the system? Well, Hims & Hers Health (HIMS) just became that friend – and learned why sometimes you really can’t outsmart the big guys.
Last week, Hims decided to crash the weight-loss drug party with their own $49-a-month version of semaglutide (the active ingredient in those trendy Wegovy and Ozempic shots everyone’s talking about). Sounds like a steal compared to the $1,000+ monthly price tags on the brand-name stuff, right?
Here’s the catch: they were making “compounded” versions – basically DIY pharmaceuticals. Think of it like making your own iPhone instead of buying from Apple, except with drugs that people inject into their bodies.
The Regulators Enter the Chat
The FDA took one look at this situation and basically said “Not today, Satan.” Within 24 hours of Hims’ launch, regulators announced plans to crack down on exactly this kind of thing. Then the Department of Health and Human Services decided to involve the Justice Department. And just to make things extra spicy, Novo Nordisk (the company that actually invented this stuff) threatened to lawyer up.
Hims’ stock promptly face-planted 16% in after-hours trading. Ouch.
Why This Backfired So Spectacularly
Here’s where the timing gets really awkward. Compounded drugs were originally allowed during shortages – kind of like how you can make your own bread when the grocery store runs out. But the FDA declared the semaglutide shortage over almost a year ago. Companies like Hims kept making knockoffs anyway, which always felt like they were playing with fire.
But wait, it gets worse. Right around the same time Hims launched their bargain-basement version, the real pharmaceutical companies struck deals with the Trump administration to offer legitimate versions for $149-$350 per month through something called TrumpRx. Suddenly, Hims’ legally questionable $49 option didn’t look like such a smart play.
After what they politely called “constructive conversations with stakeholders” (corporate speak for “please don’t destroy us”), Hims pulled their product faster than a tweet that didn’t age well.
The Real Damage
This isn’t just about one product. Weight-loss offerings were supposed to bring in around $725 million for Hims in 2025 – that’s roughly 30% of their total expected revenue. Losing access to that market is like a restaurant losing their liquor license right before New Year’s Eve.
Sure, Hims has other services – hair loss treatments, mental health support, and various telehealth offerings. But weight-loss drugs are the hottest thing in healthcare right now, and getting locked out of that party is going to hurt.
The Takeaway
Sometimes David beats Goliath, but sometimes Goliath has really good lawyers and regulatory connections. This isn’t a “buy the dip” situation – it’s a reminder that when you’re playing in Big Pharma’s sandbox, you better follow their rules.
Hims will need to prove their other business lines can make up for this loss. Until then, this stock is looking more like a gamble than an investment.