Novo Nordisk Cuts Ties With Hims & Hers in Wegovy Fallout, Sending HIMS Stock to Record Plunge

In a dramatic rupture that underscores the legal and ethical tensions surrounding the booming weight-loss drug market, Novo Nordisk has terminated its partnership with Hims & Hers Health (NYSE: HIMS), citing concerns over illegal compounding and deceptive marketing of GLP-1 weight-loss treatments. The split, announced Monday, triggered a brutal 32% plunge in HIMS shares—the worst single-day drop in the company’s history—and raised serious questions about the future of its weight-loss ambitions.

Novo Nordisk’s decision follows a broader crackdown on compounded semaglutide, the active ingredient in its blockbuster drug Wegovy. The Danish pharmaceutical giant said Hims & Hers continued to promote and sell knockoff versions of Wegovy under the false pretense of “personalization,” despite the FDA lifting its official shortage designation in May. Under U.S. law, compounded drugs are only permitted when a shortage exists or when a patient has a medically necessary reason to avoid the branded version. Novo claimed Hims had disregarded this legal line, endangering patient safety in the process.

“We expected that the efforts toward compounding personalization would diminish over time. When we didn’t see that, we had to make a choice on behalf of patients,” said Dave Moore, Novo Nordisk’s U.S. operations EVP. He added that Novo’s investigation revealed that some of the active ingredients used in Hims-supplied compounds originated from Chinese manufacturers with quality assurance issues and minimal FDA oversight. In short: Novo is done tolerating what it sees as a rogue telehealth partner.

Hims & Hers CEO Andrew Dudum swiftly fired back, accusing Novo Nordisk of misleading the public and engaging in anticompetitive behavior. In a fiery statement posted on X, Dudum claimed Novo’s commercial team pressured Hims to push Wegovy, even when it may not have been the best clinical fit for patients. “We refuse to be strong-armed by any pharmaceutical company’s anticompetitive demands,” Dudum wrote. “We take our role of protecting the ability of providers and patients to control individual treatment decisions extremely seriously.”

The breakup is a stark reversal from just two months ago, when Novo Nordisk partnered with several telehealth firms—including Hims—to expand access to Wegovy as supply constraints eased. The alliance had been positioned as a way to bring legitimacy and broader distribution to GLP-1s through regulated channels, giving patients an alternative to the murky world of compounded semaglutide. But Novo’s patience wore thin as Hims allegedly continued to market and sell personalized alternatives in defiance of new FDA guidance.

Analysts reacted swiftly. Needham downgraded HIMS to “Hold” and removed it from its Conviction List, warning that the termination introduces significant legal risk and leaves Hims at a competitive disadvantage. With rival platforms like Ro and Sequence still in Novo’s good graces—and in Eli Lilly’s ecosystem—Hims now faces a double whammy: reputational damage and weakened access to the two most in-demand weight-loss drugs on the market.

Citi analyst Daniel Grosslight also sounded alarm bells, noting he was surprised the initial partnership with Novo had allowed compounding to persist at all. Now that the legal shield of a national shortage is gone, continued distribution of compounded semaglutide under the guise of personalization reopens Hims to regulatory scrutiny—and potentially, lawsuits.

The GLP-1 market has rapidly transformed obesity treatment, with high-profile drugs like Wegovy and Lilly’s Zepbound commanding prices of $1,000 or more per month. During the peak of the shortage, compounding pharmacies—legally or otherwise—filled the gap with customized alternatives. Telehealth platforms seized the opportunity, marketing affordable access and convenience, though often blurring regulatory lines.

The FDA’s ruling that shortages were over by late May was meant to rein in this chaotic gray market. But it has created headaches for companies like Hims that built out GLP-1 businesses during the gold rush. Now, with the regulatory tide turning and pharma giants like Novo cracking down, those business models look increasingly exposed.

For Hims, the termination could ripple beyond GLP-1s. While weight-loss drugs were not yet the largest contributor to revenue, they were seen as a key growth driver and a hook to draw users deeper into Hims' wellness ecosystem. Without the stamp of approval from Novo—or access to its branded supply—the company will have to navigate a murky path forward, either by doubling down on the personalization argument or pivoting to other offerings entirely.

Investors aren’t waiting to find out. Monday’s share plunge suggests deep skepticism over Hims' ability to sustain its momentum in the weight-loss category without institutional pharma support. With Novo vowing to pursue legal action against bad actors and the FDA signaling greater scrutiny, Hims may now find itself at the center of an expensive and distracting battle over the future of personalized medicine.

The weight-loss drug boom isn’t slowing down—but for Hims & Hers, the fallout from this split may prove more difficult to slim down.