Novo Nordisk surges as Hims pulls $49 weight loss pill under FDA pressure

By Stine Jacobsen

COPENHAGEN, Feb 9 (Reuters) - Novo Nordisk's NOVOb.CO shares jumped more than 8% on Monday after telehealth firm Hims & Hers HIMS.N cancelled the launch of a $49 copy of a weight-loss pill following legal threats from the Danish group and the U.S. Food and Drug Administration.

The gains pushed Novo's shares higher than before Hims announced its non-FDA-approved version of Novo's semaglutide as investors perceived the FDA actions as a broader crackdown on compounded GLP-1 drugs, which could reduce competitive threats to branded treatments, analysts said.

Hims introduced the compounded pill on Thursday, prompting pushback from the Danish drugmaker and regulatory authorities. It is based on semaglutide, used in Novo Nordisk's blockbuster drugs Wegovy and Ozempic.

Hims said on Saturday it would stop offering the treatment after holding "constructive conversations with stakeholders."

Shares of Hims fell 14.8% in premarket trading on Monday.

RARE VICTORY FOR NOVO AS IT FIGHTS COPYCAT DRUGS

The FDA said on Friday it would restrict GLP-1 ingredients used in non-approved compounded drugs that telehealth firms such as Hims and compounding pharmacies have marketed as alternatives to authorized treatments.

AL Sydbank analyst Soren Lontoft Hansen and Jyske Bank analyst Henrik Hallengreen Laustsen both said Novo's share price reflected investors' positive response to the FDA taking broader aim at the unregulated compounding industry.

The FDA "is not only declaring war on Hims & Hers' Wegovy pill, but (compounded) GLP-1s in general," Hansen said, a move that has positive implications for Novo Nordisk and rival Eli Lilly.

Hims' swift reversal of its pill launch marked a rare victory in Novo Nordisk's battle against copycat compounded versions of its GLP-1 drugs.

Hims did not respond to Reuters' queries on Saturday about whether it would continue selling compounded semaglutide injections on its website.

PRICING PRESSURES REMAIN FOR NOVO NORDISK

Novo's shares had already rebounded over 5% on Friday after the FDA signalled a crackdown on compounded GLP-1 medications, which have challenged the drugmaker's pricing power in the weight-loss and diabetes markets.

Still, intense competition continues in the rapidly shifting GLP-1 market as Eli Lilly LLY.N and compounding pharmacies offer injectable versions of semaglutide.

Novo Nordisk's market value has dropped nearly two-thirds since it peaked in June 2024 and is down nearly 50% over the past year.

More recently, its stock sank 17% in a day after it last week flagged "unprecedented price pressure" at its full-year earnings.

Despite pioneering the obesity drug market, the recent setbacks show how quickly Novo's dominance has eroded. And with Eli Lilly's oral GLP-1 pill orforglipron expected to launch in April, competitive pressure is set to intensify.

In the key U.S. market, the obesity drugs made by Novo Nordisk and Lilly are driving a shift to a consumer-focused market in which drugmakers are increasingly looking to cash-pay channels and telehealth to reach tens of millions of Americans.

Hims, Novo Nordisk and Eli Lilly ran advertisements during Sunday's Super Bowl promoting their weight-loss treatments.