NEW YORK – Novo Nordisk has announced the termination of its collaboration with telehealth company Hims & Hers, citing concerns over the promotion of unapproved versions of its weight loss drug, Wegovy.
Immediate Impact
The decision sent shockwaves through the stock market, with Hims & Hers shares plummeting over 34% and Novo Nordisk’s stock dropping more than 5% on Monday. The move comes as Novo Nordisk aims to tighten control over the distribution of Wegovy amidst concerns about patient safety.
Key Details Emerge
Novo Nordisk initially partnered with telehealth companies, including Hims & Hers, to broaden access to Wegovy in the U.S. after resolving supply shortages. However, the drugmaker expressed alarm over Hims & Hers’ alleged violation of laws prohibiting mass sales of compounded drugs under the guise of personalization.
“We expected that the efforts towards 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 executive vice president of U.S. operations.
Industry Response
In response, Hims & Hers CEO Andrew Dudum criticized Novo Nordisk, accusing the company of misleading the public and pressuring them to prioritize Wegovy sales. Dudum emphasized the importance of maintaining clinical standards and patient autonomy in treatment decisions.
“We will not compromise the integrity of our platform to appease a third party or preserve a collaboration,” Dudum stated.
By the Numbers
- Hims & Hers shares fell over 34% on Monday.
- Novo Nordisk shares decreased by more than 5%.
- Compounding pharmacies restricted from making Wegovy knock-offs since May 22.
What Comes Next
Novo Nordisk plans to continue offering Wegovy through telehealth organizations that align with their commitment to safe medication practices. The company is also looking to engage legally and with the FDA to curb illegal compounding activities.
Background Context
Compounding pharmacies had been producing cheaper versions of Wegovy during its shortage. However, these practices faced scrutiny due to the lack of FDA approval for compounded drugs. Novo Nordisk’s investigation revealed that many active ingredients for these knock-offs were sourced from uninspected suppliers in China.
Expert Analysis
Citi analyst Daniel Grosslight noted that the end of the partnership significantly increases Hims & Hers’ legal risks. The absence of measures to control compounding efforts in the initial agreement surprised industry observers.
Regional Implications
The announcement has broader implications for the telehealth and pharmaceutical industries, highlighting the ongoing tension between drugmakers and compounding pharmacies. As Novo Nordisk strengthens its stance, other companies may follow suit to protect their patented medications.
With the spotlight on patient safety and regulatory compliance, the industry faces a critical juncture in balancing innovation and adherence to legal standards.