Hims & Hers plunges 25% as Weight Loss Drug Strategy Backfires

Hims is down more than 25% after the online retailer scrapped a plan to offer a knockoff version of the Wegovy weight-loss pill.

“Since launching the compounded semaglutide pill on our platform, we’ve had constructive conversations with stakeholders across the industry. As a result, we have decided to stop offering access to this treatment,” Hims said in a statement.

The Department of Health and Human Services (DHHS) referred the company to the Department of Justice for investigation last week.

Heightened regulatory scrutiny could be a major blow for Hims, which makes money selling cheaper, compounded versions of popular GLP-1 weight-loss medications.

“If the regulators restrict access to the core ingredients and products for organizations like Hims, then GLP-1 compounding revenue may come under significant pressure in 2026 and beyond,” BTIG analyst David Larsen, who rates the stock at Buy with a $60 price target, wrote in a research note.

Sentiment: Bearish, but also I was interested in $hims before they got into the GLP-1 race. The pulback warrants looking at the company again.