Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Novo Nordisk has terminated its partnership with US telehealth group Hims & Hers after accusing it of deceptively marketing copycat versions of its blockbuster Wegovy weight loss drug, sending shares in both companies down sharply.
The Danish pharmaceutical group said on Monday it had ended a collaboration with Hims & Hers Health, announced in April, to distribute Wegovy.
Hims & Hers shares tumbled 32 per cent on the news, although they remain up 74 per cent since the start of the year. In a statement on X, Hims chief executive Andrew Dudum said the company will continue offering Wegovy.
“We are disappointed to see Novo Nordisk management misleading the public,” Dudum said. “We refuse to be strong-armed by any pharmaceutical company’s anti-competitive demands that infringe on the independent decision making of providers and limit patient choice.”
Novo shares closed down 5 per cent on Monday.
The dispute relates to the practice of “compounding” — the preparation of custom-made drugs using active ingredients that replicate those in patented medicines but are sourced elsewhere.
Compounded versions of obesity and diabetes drugs flourished in the US when the Food and Drug Administration allowed pharmacies to make them following its 2022 declaration of official shortages of Novo’s Wegovy and Ozempic as well as rival Eli Lilly’s Zepbound.
Novo began collaborating with Hims & Hers and other telehealth companies to boost Wegovy sales once the FDA declared the shortages over earlier this year, putting pharmacies on notice to stop selling compounded versions.
Novo claimed Hims & Hers had failed to follow laws prohibiting mass sales of compounded drugs “under the false guise of ‘personalisation’,” and accused the company of “disseminating deceptive marketing that put patient safety at risk”.
“Novo Nordisk is firm on our position and protecting patients living with obesity,” said Dave Moore, executive vice-president of the company’s US operations. “We will work with telehealth companies to provide direct access to Wegovy that share our commitment to patient safety.”
Hims & Hers, whose stock has soared over the past year as it benefited from the booming US obesity treatment market, announced this month that it had bought London-based telehealth rival Zava. It signalled that it was exploring offering replica weight-loss treatments in the UK and Europe.
Novo’s spat with Hims & Hers is the latest blow for the Danish company, and comes after the abrupt exit of chief executive Lars Fruergaard Jørgensen in May.
The collapse of the Hims & Hers deal dents its strategy of using telehealth companies to help boost Wegovy sales and allay investor fears it is losing market share to Lilly. Shareholders are also concerned that Novo’s pipeline of new drugs is not as strong as its competitors’. Novo’s shares have fallen more than half over the past year.
At this month’s American Diabetes Association conference Novo published promising early results from trials of a new obesity drug, amycretin. It also published more detailed data for another obesity drug candidate, CagriSema: preliminary trial results published at the end of last year showed it had missed its weight loss target, disappointing the market.
