Novo Nordisk Sues Hims & Hers Over Wegovy Copycats — And the $49 Obesity Pill That Lasted Just Two Days

The timeline tells the story. Last week, Hims & Hers announced with considerable fanfare that it would begin offering an oral compounded semaglutide pill — the same active ingredient in Novo Nordisk's Wegovy — for as little as $49 per month. Novo's FDA-approved Wegovy pill, launched in January, carries a list price of roughly $149. The pitch to consumers was straightforward: the same drug, at a fraction of the cost, delivered through Hims' slick direct-to-consumer telehealth platform.

The response from regulators and Novo Nordisk was swift and devastating. On Friday, the FDA announced it would take "decisive steps" to restrict GLP-1 ingredients in compounded drugs not approved by the agency, explicitly calling out Hims. The agency said it planned to refer Hims to the Department of Justice over potential violations. By Saturday, Hims pulled the oral pill from its platform. Then on Monday, Novo filed its patent lawsuit, seeking both a permanent injunction and damages.

"This is a complete sham, and it has been a sham since the shortage ended," said John Kuckelman, Novo's group general counsel, in an interview. Semaglutide is no longer in shortage in the United States — a key distinction, because compounding pharmacies were allowed to produce alternatives during the period when branded supply couldn't meet demand. With supply restored, the legal justification for compounded semaglutide has evaporated, and Novo is pressing its advantage. The company has now filed approximately 130 lawsuits related to compounded versions of its drugs.

The market's reaction has been brutal but perhaps disproportionate. Hims & Hers has lost roughly $8.8 billion in market capitalization over the past month, falling from a market cap north of $12.8 billion to approximately $4.0 billion today. TD Cowen slashed its price target from $30 to $20 on Monday and maintained a hold rating. Multiple analysts have downgraded the stock.

But the bull case for Hims isn't dead. The company's revenue has been growing at a torrid pace: $481 million in Q4 2024, $586 million in Q1 2025, $545 million in Q2, and $599 million in Q3 — a trajectory that puts it on pace for roughly $2.2 billion in annual revenue. Gross margins remain healthy at 73.8%. And critically, weight-loss products represent only about 30% of Hims' total revenue. The platform's broader business — hair loss, skin care, mental health, sexual health — continues to grow independently of the GLP-1 drama.

The risk, however, is real. With the FDA signaling new restrictions on compounded GLP-1 APIs and Novo's patent on semaglutide extending through 2032, Hims' ability to offer any semaglutide-based product faces existential legal challenges. Analyst estimates for 2027 project quarterly revenue of $716–$836 million, but those estimates were likely set before this week's regulatory escalation.

For Novo Nordisk, the lawsuit against Hims is part of a broader strategy to regain control of a narrative that has slipped badly over the past year. The Danish pharmaceutical giant's stock has been cut nearly in half from its highs, weighed down by fierce competition from Eli Lilly, price pressure in the U.S. market, and a guidance reset that shocked investors.

Novo's 2025 full-year results told a mixed story. Revenue grew 6% year-over-year, but quarterly earnings have been volatile. The company posted EPS of DKK 6.54 in Q1 2025, DKK 5.96 in Q2, DKK 4.50 in Q3, and DKK 6.04 in Q4 — a bumpy ride that reflects both the competitive pressure from Eli Lilly's Mounjaro and Zepbound, and the margin squeeze from ramping up manufacturing capacity.

The Wegovy pill launch has been the brightest spot. More than 170,000 American patients have started on the oral formulation since its January debut — an explosive uptake that suggests strong consumer demand for a pill-based GLP-1 alternative to injections. But even that success is tinged with controversy: the FDA flagged Novo's TV advertisement for the Wegovy pill as containing "false or misleading" claims about the drug's benefits, including suggestions of emotional and psychological relief beyond physical weight loss. At a P/E of 13.7 and a market cap of $220.5 billion — roughly a quarter of Eli Lilly's $926 billion valuation — Novo trades at a steep discount to its rival, reflecting the market's uncertainty about its competitive position.

While Novo and Hims battle in court, Eli Lilly continues to quietly dominate the GLP-1 market. Lilly's revenue trajectory has been staggering: $12.7 billion in Q1 2025, $15.6 billion in Q2, $17.6 billion in Q3, and $19.3 billion in Q4 — representing roughly 52% year-over-year growth across the year. The company's tirzepatide-based drugs, Mounjaro and Zepbound, have been gaining market share at Novo's expense.

Lilly trades at a P/E of 45.0 with a market cap of $926 billion — more than four times Novo's valuation. The gap reflects the market's conviction that Lilly's pipeline and competitive execution are superior. Lilly is also building a $6.5 billion manufacturing facility in Texas specifically for its obesity pill and other drugs, a signal of the scale of investment required to compete in this space.

Lilly has waged its own legal war against compounders of tirzepatide, and its injectable supply shortages have also been resolved. The compounding loophole that allowed companies like Hims to proliferate is rapidly closing for both major GLP-1 drugs. For investors, the question is whether Novo's steep discount to Lilly represents a value opportunity or a value trap — and how much of the compounding market's estimated 1.5 million users will convert to branded products rather than simply abandoning treatment.

The FDA's actions this past week signal a decisive shift in the regulatory landscape for compounded GLP-1 drugs. The agency's announcement that it will restrict access to semaglutide active pharmaceutical ingredients for compounding, combined with its referral of Hims to the Department of Justice, suggests the era of mass-compounded GLP-1 alternatives is ending.

This has massive implications. Novo estimated that as many as 1.5 million Americans are currently using compounded GLP-1 drugs — a substantial market that exists largely because branded treatments have been expensive and, until recently, in short supply. As compounded options disappear, those patients face a stark choice: pay brand-name prices (Wegovy's pill at $149/month, injections at significantly more), find insurance coverage, or stop treatment.

Novo's general counsel, John Kuckelman, drew a distinction between legitimate patient-specific compounding and what he characterized as "mass stocks of what you're calling a personalized medicine, which is really just a dosage variation." He pointed to telehealth company Ro as an example of a platform "doing the right things" by transitioning patients to FDA-approved products. Hims, in its defense, called the lawsuit "a blatant attack by a Danish company on millions of Americans who rely on compounded medications for access to personalized care" — framing the fight as Big Pharma versus consumer access.

The legal battle will likely play out over months, but the direction is clear. With semaglutide patents extending through 2032 and the FDA moving aggressively, the window for compounded GLP-1 alternatives is closing fast. The question is not whether compounded semaglutide survives — it almost certainly won't — but how the 1.5 million patients currently using it will be absorbed into the branded market, and what that means for Novo's recovery.