Telehealth Stock Hims & Hers Surges Amid GLP-1 Drug Controversy and Supply Concerns
Key Points:
* Hims & Hers (HIMS) stock spiked over 27% after its controversial Super Bowl ad promoting affordable GLP-1 weight-loss drugs.
* The ad criticized the healthcare system and raised questions about the company's reference to knockoff or branded drugs.
* HIMS stock has climbed over 100% this year, fueled by retail investor interest and Senate approval of Robert F. Kennedy Jr. as HHS secretary.
* Concerns over GLP-1 shortages persist, with telehealth players like Hims and Ro capturing an estimated 20% market share.
* Lilly and Novo Nordisk are investing billions to ramp up production, but supply constraints remain.
* The FDA has removed Lilly's Mounjaro and Zepbound from its shortage list, while Novo's Ozempic and Wegovy remain on the list despite increased production.
Analysis:
Healthcare expert Jared Holz predicts a lenient stance from the new HHS under RFK Jr. towards GLP compounders, if the drugs are deemed safe.
The incoming administration prioritizes cost-benefit in the pharmaceutical industry, particularly in preventative health.
The enthusiasm for HIMS stems from ongoing GLP-1 shortages, which allow compounding pharmacies to produce and sell lower-priced products.
Despite safety concerns, consumers have embraced telehealth platforms like Hims and Ro, which offer compounded drugs.
The removal of Lilly's tirzepatide drugs from the shortage list signals progress, but concerns remain about meeting demand.
Novo's semaglutide drugs remain on the FDA's list, but the company is working to have them removed based on increased production.
This has allowed Hims and Ro to continue providing compounded GLP-1 products, despite potential supply constraints.