HIMS Expanding into Canada

I’ve not bought into HIMS - I don’t know enough about it - but I saw this in The Globe and Mail (the biggest newspaper in Canada):

“U.S. telehealth platform Hims & Hers Health Inc. [plans to enter the Canadian market in the new year] by selling generic forms of the blockbuster weight-loss and diabetes drugs Ozempic and Wegovy. It is among the first companies to publicize efforts to take advantage of the Canadian patents on those drugs expiring in January, 2026. As Chris Hannay reports, Ozempic, which is by far the best-selling drug in Canada, contains the active ingredient semaglutide and generic versions of that ingredient will sell at a fraction of the cost of the brand-name version.”

The reason it’s going to be substantially cheaper in Canada is a missed patent payment:

“Novo Nordisk will lose patent protection for Ozempic (and Wegovy) in Canada because they failed to pay a maintenance fee, causing the patent to lapse. This fee, reportedly around $450 CAD, was due in 2019, and the company did not pay it, resulting in the patent expiring. This means that generic versions of semaglutide, the active ingredient in Ozempic, can be legally produced and sold in Canada, potentially leading to lower prices.”

They will have competition. There are several online-style pharmacies in Canada and they won’t be sitting by while a US competitor enters the market. With the current anti-US sentiment in Canada, I suspect this won’t be a boost for HIMS, but still something to note. It may be the opposite - entry into Canada won’t be cheap, and may distract from the core business.

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This is close but not the full picture. The words missed patent implies that Novo Nordisk forgot to file. They decided to not pay a routine $450 CAD annual maintenance fee in 2020.

Why would Novo Nordisk decide to not pay a small fee for a billion dollar company?

  • Generic drugs were only blocked up to 4 Jan 2026.
  • Protecting against generic drugs would costs in tens of millions in legal fees
  • By not paying for the extension they only lost 2 years of exclusivity.

My thoughts is Novo Nordisk heavily weighed the pros and cons of extending their patent for 2 years and thought that defending their market in the courts against generics was a losing battle and decided to not go that route.

Drew

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