What’s Happening With HIMS Stock?

Hims & Hers Health (NASDAQ: HIMS) experienced a sharp 35% drop in its stock price on June 23, 2025, following Novo Nordisk’s abrupt cancellation of their short-lived partnership. This steep decline reflects not only the immediate loss of a crucial alliance but also raises broader concerns about the company’s long-term potential in the weight-loss medication market.

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The Partnership That Wasn’t

The alliance between HIMS and Novo Nordisk, initiated in April 2025, was expected to be transformative for the telehealth firm. It offered direct access to Wegovy, Novo Nordisk’s top-selling weight-loss drug, via HIMS’s platform. This opportunity contributed significantly to HIMS’s 150% stock surge earlier this year, driven by investor optimism around a robust revenue growth pathway.
But the collaboration dissolved in just two months. Novo Nordisk expressed concerns about what it described as “illegal mass compounding and deceptive marketing” by HIMS, specifically criticizing the continued sale of customized, compounded versions of semaglutide (the active ingredient in Wegovy) instead of sticking to the branded drug.

The Core Conflict

This dispute underscores a key tension in the weight-loss drug space. After the FDA declared the end of the semaglutide shortage, compounding pharmacies technically lost their legal grounds to produce alternative versions of the drug. Yet HIMS persisted in promoting personalized formulations, which Novo Nordisk saw as a threat to its branded offering and possibly in breach of regulatory standards.

If HIMS were to return to its historical valuation multiple of three times revenue, the stock could drop to around $25 — implying a further 40% decline from current levels. This indicates that the sell-off may not be over, especially as investors reevaluate the company’s prospects without the crucial partnership.

Limited Pathway Forward

While HIMS may continue offering personalized obesity treatments, this strategy is fraught with challenges. Regulatory uncertainty looms large, with the FDA potentially clamping down on companies that exploit compounding exceptions rather than offering truly individualized care. Moreover, the absence of direct Wegovy sales removes a significant potential revenue channel from the company’s member base.

The critical question is whether HIMS’s existing business model can sustain growth sufficient to justify any kind of premium valuation. Although the personalized model may cater to a niche, it’s unlikely to replicate the scale Wegovy could have delivered.

The Verdict

HIMS’s situation is a textbook example of why investors should be cautious about “buying the dip.” The 35% decline is stark, but it stems from a fundamental shift in the investment narrative. The company has lost its most promising growth lever and now faces elevated regulatory risks.
At this point, a wait-and-watch strategy may be more prudent. While HIMS could pursue other growth avenues, these are likely to be less predictable and potentially less rewarding without the Novo Nordisk tie-up. The market’s swift reaction to the breakup sends a clear warning: when a company’s primary growth engine vanishes, even a steep stock decline may not reset the risk-reward balance attractively.

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