Hims slips after US lawmakers introduce bill cracking down on compounding
Analysts at Citi said that the bill presents a headwind for Hims.
Hims & Hers slipped on Wednesday after members of Congress introduced a bill that would limit its ability to sell copies of blockbuster weight-loss drugs made by Eli Lilly and Novo Nordisk.
The bill, “Safeguarding Americans from Fraudulent and Experimental (SAFE) Drugs Act of 2025,” is sponsored by Rep. Rudy Yakym III and Rep. Andre Carson, both of Indiana, where Lilly is headquartered. The bill would raise the bar for when it is legal to dispense compounded versions of popular weight-loss drugs, an industry that has exploded in the past couple of years.
Analysts at Citi said that the bill presents a headwind for Hims. It would “significantly curtail [Hims’] ability to compound GLP-1s,” the product category where the company has seen the most revenue growth in the past year, the analysts said in a Wednesday morning note.
Under federal law, compounding pharmacies can sell exact copies of a branded medication only when it is in a shortage. Lilly and Novo’s GLP-1s were taken off the Food and Drug Administration’s shortage list earlier this year, meaning compounding pharmacies could only continue selling bespoke versions for individual patients.
Telehealth companies like Hims have continued to market compounded GLP-1s, often referring to them “personalized.” The bill would raise the bar for when that is allowed, requiring a doctor to determine whether a compounded version creates a “significant difference” over the commercially available version sold by drugmakers.
The drugmakers have pushed back on telehealth companies’ claim of “personalization,” arguing that the drugs are mass produced and not made for specific patients like the law intends. Lilly and Novo have taken some of these companies to court, and have for the most part lost. The drugmakers have also urged the FDA to up enforcement, but it shares regulatory responsibility with a patchwork of state regulators.
The SAFE Act may empower the FDA to crack down on compounders, which have been nibbling away at drugmakers’ market share.
Hims did not immediately respond to a request for comment.
