Feb 5 (Reuters) – Hims & Hers said it would begin offering compounded versions of Novo Nordisk’s Wegovy pill at an introductory price of $49 per month.
The company said the offering would be guided by clinical recommendations for personalized treatment, mirroring the approach it had taken with compounded injectable weight-loss drugs.
Shares of Novo and rival Eli Lilly dropped after the launch announcement over concerns on how companies will protect margins as lower-cost alternatives emerge.
Below are some reactions to the announcement:
DAVID WAGNER, PORTFOLIO MANAGER AT APTUS CAPITAL ADVISORS
“Headline risk around GLP-1 will be around for quite some time as it feels like an arms race for market share and overall pricing. But, Lilly has continued to show that they’re the dominant player in the space and shares should act as teflon during headline risk, but when the shares ultimately get hit, like they have today, it tends to be a buying opportunity.”
BRIAN MULBERRY, PORTFOLIO MANAGER AT ZACKS INVESTMENT MANAGEMENT
“The new pill form of the GLP-1 is going to open up the market so significantly that both Lilly and Novo can demonstrate strong growth in revenue. Hims and Hers has grown into a large distribution hub and it does say something that they have gone with the Novo version. That said, Lilly is working through its own direct-to-consumer model, so no real damage there.”
MICHAEL NEDELCOVYCH, TD COWEN ANALYST
“The status quo for months now has been a compounder can create a copycat version of a branded drug, so long as they make some kind of minor tweak that they believe or they argue benefits specific patient groups. And in the case of GLP-1, the argument is as simple as in between doses or lower doses than are offered commercially, which obviously leaves the door pretty wide open.”
“Novo’s guidance range is pretty wide and the low end of it is pretty low. So I doubt that this is the kind of development that would cause them to worry that they didn’t go low enough.”
“For Lilly, the reaction, I think, is just around speculation as to whether orforglipron could be next”
MARKUS MANNS, PORTFOLIO MANAGER AT UNION INVESTMENT, A NOVO AND LILLY SHAREHOLDER
“It seems illegal (Hims move). However, it is not clear if and how long it will take Novo to stop them and if the FDA is willing to step in. Until this issue is resolved, it adds another level of uncertainty to the obesity investment story.”
KAREN ANDERSEN, ANALYST AT MORNINGSTAR
“If Hims is allowed to proceed with this launch, I’m not sure why they won’t just launch compounded orforglipron once Lilly receives approval for that (expected in the second quarter), or really any new drug, for that matter. Either the laws protecting branded drugs aren’t clear enough, or they aren’t being enforced, or both.”
“I know one area that Hims focuses on is patients who want to take very low doses of semaglutide. This lessens the production capacity that is required, but for the pill, you need a much higher dose to be effective, even if you have the SNAC technology. So I’m not sure they would have the capacity to be a meaningful player here, assuming they are selling at a dose that is effective.”
MICHAEL CHERNY, ANALYST, LEERINK PARTNERS
“The compounded semaglutide pill is an extremely logical new product offering given the existing platform within weight loss and expected demand from available oral GLP-1s… there is no reason why Hims shouldn’t evaluate these launches for every subsequent weight-loss product as the market continues to evolve, even if the company has not historically focused on tirzepatide.”
CHRISTIAN MOORE, HC SPECIALIST AT BERNSTEIN
“The Reuters report is spooking both companies and investors questioning the legality of this vs the viability of it.”
Moore said the timing of the Hims announcement, coming shortly after Novo and Lilly earnings and outlooks isn’t ideal, and gives the market yet another thing to worry about.
EVAN SEIGERMAN, MANAGING DIRECTOR AND HEAD OF HEALTHCARE RESEARCH AT BMO CAPITAL MARKETS
“The announcement is likely to weigh on shares today.”
“Novo management remains skeptical of the product’s potential competitive profile, however, given nuances with bioavailability of oral peptides.”
(Reporting by Mariam Sunny, Christy Santhosh, Maggie Fick, Mrinalika Roy; Editing by Shilpi Majumdar)
