The U.S. Food and Drug Administration is escalating its scrutiny of compounded weight-loss drugs, a move that directly impacts telehealth providers like Hims & Hers and could reshape the rapidly expanding market for glucagon-like peptide-1 (GLP-1) therapies. The agency announced , it would take action against Hims & Hers, potentially including referral to the Department of Justice, over its $49 weight-loss pill and plans to restrict access to the ingredients used in these compounded formulations.
The FDA’s action centers on concerns regarding the safety, quality, and legal compliance of compounded drugs – those created by pharmacies mixing ingredients to create customized medications. While compounding pharmacies can legally create drugs for specific patient needs when an FDA-approved alternative isn’t available, the FDA is increasingly concerned that these pharmacies are marketing GLP-1 alternatives without proper oversight. The agency has identified issues with improper storage during shipping, potentially compromising drug quality, and the circulation of fraudulent products with false labeling.
Hims & Hers, which saw its shares fall 14.1% in after-hours trading following the announcement, had recently begun offering compounded versions of Novo Nordisk’s Wegovy at an introductory price of $49 per month – significantly lower than the brand-name drug. Novo Nordisk has already signaled its intent to pursue legal action against Hims & Hers over this initiative. The FDA’s move could effectively halt the sale of Hims’ product, which had become the cheapest GLP-1 therapy available in the U.S. Market.
Impact on the Weight-Loss Market
The crackdown is expected to benefit established pharmaceutical companies like Novo Nordisk and Eli Lilly, who have been losing market share to telehealth firms and compounding pharmacies. Novo Nordisk, in particular, stands to gain as the FDA’s actions limit the availability of cheaper, compounded alternatives to its Wegovy and Ozempic products. The rise of compounded drugs had been eroding the market dominance of these established players, offering patients a more affordable, though potentially riskier, option.
The GLP-1 market has experienced explosive growth, driven by the drugs’ effectiveness in promoting weight loss and, increasingly, evidence of broader health benefits including improved cardiovascular outcomes and kidney health. However, the high cost of these medications, coupled with limited insurance coverage for weight-loss applications, has fueled demand for more affordable alternatives, creating a fertile ground for compounded drugs.
Regulatory Concerns and Patient Safety
The FDA’s concerns extend beyond price. The agency emphasizes that compounded drugs are not FDA-approved and therefore haven’t undergone the rigorous review process for safety, effectiveness, and quality. This lack of oversight raises significant risks for patients. The FDA specifically recommends that patients obtain prescriptions from their doctors and fill them at state-licensed pharmacies. They also advise against using injectable GLP-1 drugs that arrive warm or without adequate refrigeration, as this can affect the drug’s quality.
The agency’s actions align with a broader effort to combat the proliferation of counterfeit and fraudulent weight-loss drugs. In , FDA officials warned of fake versions of Ozempic circulating in the U.S., highlighting the vulnerability of the supply chain and the potential for patients to receive ineffective or harmful medications. The FDA is working with state regulatory partners to address these concerns and communicate with compounding pharmacies.
Broader Crackdown on Telehealth Practices
The FDA’s action against Hims & Hers is not an isolated incident. The Federal Trade Commission (FTC) approved a final order against telehealth provider NextMed over deceptive advertising claims related to GLP-1 weight-loss drugs. This suggests a broader regulatory push to rein in potentially misleading practices within the rapidly growing telehealth sector. The FTC’s action underscores concerns about unsubstantiated claims and aggressive marketing tactics used by some telehealth companies.
The Department of Health and Human Services’ General Counsel, Mike Stuart, has also referred Hims & Hers to the Department of Justice for investigation over potential violations of federal law. This escalation suggests the government is prepared to pursue more serious legal consequences for companies that operate outside of regulatory boundaries.
Hims & Hers Response
Hims & Hers released a statement asserting its commitment to consumer safety and compliance with applicable laws. However, the company faces significant legal and regulatory headwinds as the FDA moves to restrict access to the ingredients used in its weight-loss pill. The outcome of the Department of Justice investigation remains uncertain, but could result in substantial penalties for the company.
The FDA’s actions signal a clear message to the compounding pharmacy industry and telehealth providers: the agency is prepared to aggressively enforce regulations to protect patient safety and ensure the integrity of the drug supply. This crackdown is likely to reshape the landscape of the weight-loss market, potentially increasing costs for consumers and consolidating market share among established pharmaceutical companies.
