Just found an X post which seemed to explain why Novo won’t sue HIMS. This cleared my concerns about potential lawsuit. May be good to buy the dip at some point.
Luffy
20 Likes
Here is HIMS CEO post on X today.
This whole HIMS/NOVO divorce makes my head hurt. Was selling 70% of my holding a mistake or was it a prudent retreat given the muddy waters? The NOVO published attack feels like an unrestrained legal department unloading both salvos. NOVO stock is down 50% and jobs are probably in jeopardy. NOVO is headless without a CEO, albeit due to poor showings against Lily and the compounder parasites such as HIMS. So who is running the show at NOVO and what is the corporate strategy? I guess it does not matter, HIMS is the enemy and no longer a frenemy.
CEO Andrew Dudum said the company intends to keep selling compounded versions of Novo Nordisk’s hugely popular weight-loss drug Wegovy, despite Novo announcing it was terminating a Wegovy supply deal with Hims NovoCure pharmacy
How can HIMS Dudum say he will continue selling NOVO’s Wegovy? How does this work? I read one source says that compounders can continue to sell specialized dosage of Wegovy. Is this loophole real or just legal doubletalk. Or do you just buy the product on the open wholesale market at a high price and resell at a small profit? This cannot be competitive with NovoCure pharmacy or even better priced Lily’s pharmacy.
The current valuation of HIMS IMO is based upon GLP-1 drugs in 2026 and awhile longer. Someday this GLP-1 stuff will just be a commodity and the HIMS technical stack, customer base, and personalization will be the primary valuation. But this is not the case right now. HIMs made a decision to continue selling personalized versions while simultaneously partnering with NOVO, it created an untenable conflict of interest. HIMs wanted its cake both ways. HIMs has lost its clearest path to significant revenue growth and faces an elevated risk profile regarding regulatory compliance. But if the bet pays off, the win will be huge for HIMs.
-zane
9 Likes
Just read this HIMS article that is quoting a Citi analyst. It identifies big profits on the HIMS compounded GLP-1 versus smaller profits on resold straight up Wegovy from the NOVO pharmacy. Can anyone confirm this?
**Where does Hims go from here?
**Analysts at Citibank said in a note that Hims is unlikely to see a material impact on its business with the end of the partnership, which is somewhat remarkable considering the stock drop it caused. The nature of the partnership — which simply allowed Hims users to access Wegovy from Novo’s direct-to-consumer pharmacy — didn’t leave much room for margin but did give Hims the benefit of being able to promote an FDA-approved drug.
**The analysts at Citi estimate that Hims was making $600 for every six-month supply of Wegovy it sold compared to the $1,494 it makes on a compounded prescription.
-zane
1 Like
Yes, this is not new information. It was pretty thoroughly discussed on this board over the past few months. Several contributors also spent a lot of effort breaking out how much (or how little, in this case) Hims would be affected by the expiration of the special shortage status given to wegovy - type drugs.
The upshot, at least in my view, was that Hims is in no way reliant on weight loss meds, has a very solid strategy, and has been consistently executing. The stock price, however, is bouncy like few others. It may not be your style
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