Colin Anderson Productions pty ltd/DigitalVision via Getty Images
Novo Nordisk Cuts Ties With Hims & Hers Health - Brief Explanation & Background
It was never a match made in heaven, and now it looks like it may be over.
Novo Nordisk News Is Bad News For Hims & Hers As GLP-1 Collaboration Terminated - Expect Volatility
Summary
- Novo Nordisk terminated its partnership with Hims & Hers Health over compounded Wegovy, causing HIMS shares to plunge 30% and NVO to drop 6%.
- Hims & Hers' reliance on compounded GLP-1 drugs fueled explosive growth, but regulatory changes and Novo's actions threaten this business model and future profitability.
- Novo is well-positioned long-term, with strong financials and a robust GLP-1 pipeline, despite recent setbacks and share price volatility.
- I recommend a wait-and-see approach for both stocks; NVO should recover, while HIMS faces significant uncertainty without compounded or branded GLP-1 offerings.
Edmund Ingham is a biotech consultant. He has been covering biotech, healthcare, and pharma for over 5 years, and has put together detailed reports of over 1,000 companies. He leads the investing group Haggerston BioHealth.
The group is for both novice and experienced biotech investors. It provides catalysts to look out for and buy and sell ratings. It also provides product sales and forecasts for all the Big Pharmas, forecasting, integrated financial statements, discounted cash flow analysis and market by market analysis. Learn more.Analyst’s Disclosure:I/we have a beneficial long position in the shares of NVO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.