The Hims brand organized on a laptop computer in New York, US, on Wednesday, Feb. 12, 2025.
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NEW YORK, Might 30 (Reuters) – Telehealth platform Hims & Hers (HIMS.N), opens new tab will minimize 68 staff, or about 4% of its workforce, because it adjusts to a U.S. ban on manufacturing mass copies of the weight-loss drug Wegovy.
A U.S. Meals and Drug Administration ban on compounded copies of Wegovy, made by Novo Nordisk (NOVOb.CO), opens new tab, took impact on Might 22. Hims shares have since dropped 14%. The corporate confirmed the job cuts in an announcement on Friday. On Saturday, it stated that the reductions weren’t associated to the compounding ban. Hims didn’t present particulars concerning the roles that had been minimize, however stated they had been applied throughout groups. “These adjustments are centered on sharpening how we execute, with out affecting our priorities or the specialties we’re dedicated to,” an organization spokesperson stated concerning the layoffs. Hims nonetheless plans to rent for roles associated to its long-term progress technique.
The corporate not too long ago introduced an settlement with Novo to assist sufferers entry brand-name Wegovy. It plans to enter the marketplace for low testosterone and menopause therapies and is choices to enhance longevity and sleep.
Bloomberg Information reported the job cuts earlier on Friday.
In 2022, the FDA declared a scarcity of Wegovy, which has been proven to assist sufferers lose round 15% of their physique weight. That declaration allowed compounding pharmacies to provide the drug to fulfill demand.
Hims started providing copies of Wegovy in 2024, typically at far decrease costs than the brand-name model. That boosted subscriptions to the Hims telehealth platform, with income up 111% on a yearly foundation in the course of the first quarter of 2025.
Wegovy copies and related GLP-1 weight-loss medicine accounted for $200 million of the corporate’s $1.5 billion income in 2024.
The FDA in February stated Wegovy was now not in scarcity and ended the exception that allowed sale of mass compounded copies of the patented treatment.
Hims and its rivals have pivoted to what they are saying are personalized copies of Wegovy that shouldn’t be topic to the FDA determination, that includes smaller doses or permitting for a extra individualized plan for rising dosage than provided by Novo.
However analysts stated that personalization technique will not be sufficient to stave off new authorized challenges from Novo.
“It stays to be seen whether or not HIMS methodology of personalization (titration and dosage) is sufficient to meet the compounding medical exemption want,” stated Jailendra Singh, a healthcare analyst at Truist.