By Denny Jacob

Hims & Hers Health shares tumbled after a leading competitor said a shortage of its weight-loss treatments has been resolved, raising questions about the company's prospects in the space.

Shares tumbled 21% to $52.22. Over the last year, the stock has surged more than 450%.

Drugmaker Novo Nordisk said that the Food and Drug Administration determined that the shortage of Wegovy and Ozempic, the company's blockbuster obesity and diabetes drugs, has been resolved. It added that the regulator's assessment confirmed that the U.S. supply of these prescription-only GLP-1 medicines now meets or exceeds both current and projected U.S. demand.

The news appears to have alarmed Hims' investors, given the company's weight-loss offering filled a void left by a mismatch in supply and demand. The company last year began offering access to compounded semaglutide, a version of the active ingredient in Novo Nordisk's Wegovy and Ozempic drugs, at a far lower price than those branded drugs.

The FDA allows semaglutide to be compounded because it is considered to be in short supply. The regulator on Friday said it doesn't intend to take action against compounders to avoid unnecessary disruption to patient treatment.

Hims, a telehealth-consultation platform, has indicated it will stick with its weight-loss offerings even if GLP-1 drugs are taken off the FDA's shortage list. The company also focuses on treatments for sexual health, hair loss and mental health, among others.

Write to Denny Jacob at denny.jacob@wsj.com

(END) Dow Jones Newswires

February 21, 2025 11:01 ET (16:01 GMT)

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