Shares in Hims & Hers (NYSE:HIMS) dropped early Friday after a legal threat from Novo Nordisk (NYSE:NVO).
The online teleheath company announced on Thursday plans to launch a cheaper, copycat version of Novo’s weight loss pill, prompting Novo to take legal action.
Hims stock spiked as much as 15% on the news in Thursday trading, but quickly pared gains and ended the session down 3.8% at a 12-month low after Novo said the action was “illegal.”
Hims said it will launch a Wegovy-style pill containing the same active ingredient as the original brand, semaglutide, for as little as $49 for the first month when customers sign up for a subscription. After the first month, the price will rise to $99.
That’s significantly lower than the $149 Novo Nordisk sells its starting dose for on its direct-to-consumer website NovoCare.
Hims is launching its pill even though semaglutide has patent protection in the U.S. until 2032.
The telehealth firm’s business flourished when it started selling compounded semaglutide in an injectable format, using a loophole in U.S. regulation that allows competitors to sell a drug protected by intellectual property laws if the drug is in short supply.
HIMS slid $1.29, or 5.5%, to $22.19 soon after Friday’s opening, while shares in NVO climbed $3.07, or 7%, to $46.41.
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