Key Takeaways
- A partnership between Novo Nordisk and Hims & Hers to distribute weight-loss medications could be announced as early as Monday
- Shares of Hims jumped 39% during after-hours trading on Friday
- The collaboration resolves an ongoing legal battle, including a patent lawsuit Novo filed last month
- Novo had previously ended an earlier partnership with Hims due to concerns about marketing practices and compounded drug distribution
- The FDA had also warned Hims about potential enforcement action regarding its $49 compounded semaglutide product
Novo Nordisk and Hims & Hers are preparing to announce a collaboration to distribute obesity medications via Hims’ telehealth platform, bringing an end to a contentious legal dispute that had intensified into patent litigation mere weeks ago.
Bloomberg News broke the story on Friday evening, referencing an anonymous source with knowledge of the arrangement. Following the report, Hims stock experienced a dramatic 39% surge in after-hours trading.
An official announcement from both companies is anticipated as soon as Monday. Details regarding the financial structure of the partnership have not been made public.
A Dramatic Reversal
The shift from adversaries to partners is remarkable. Only weeks ago, Novo initiated patent infringement litigation against Hims following the telehealth firm’s brief launch of a $49 compounded alternative to Novo’s weight-loss medication.
Adding to Hims’ challenges, the U.S. Food and Drug Administration had issued warnings about potential enforcement actions concerning Hims’ distribution of compounded semaglutide, the active pharmaceutical ingredient found in Wegovy and Ozempic.
The combination of regulatory scrutiny and legal pressure from Novo created a precarious situation for Hims entering the week.
This marks the second attempt at cooperation between the two entities. Novo terminated an earlier partnership with Hims in the previous year, expressing dissatisfaction with Hims’ promotional strategies and its ongoing sale of compounded Wegovy alternatives.
This renewed agreement suggests both parties have reached mutually acceptable terms for working together.
Implications for Each Company
For Novo, this collaboration provides an additional avenue to reach consumers with its branded weight-loss treatments as competition intensifies in the obesity pharmaceutical sector.
A Novo representative indicated the company is “always in conversation with companies that can help improve patient access to FDA-approved medicines.” The company has offered limited public comment beyond this statement.
Hims declined to provide a statement when contacted for comment.
For Hims, the partnership represents a significant strategic shift. The company had previously emphasized compounded semaglutide as an affordable substitute for Novo’s medications.
This approach encountered significant obstacles after the FDA removed semaglutide from its shortage list earlier this year, eliminating the regulatory justification for compounding facilities to continue manufacturing it.
Current Market Status
Hims stock experienced a 39% increase in after-hours trading on Friday. During standard market hours, both stocks closed lower — NVO decreased 1.25% while HIMS fell 0.88%.
The companies are expected to make their formal announcement no later than Monday, March 9.
