Chapter 1: How did Hims become a leading digital healthcare company?
Welcome back to The Rundown for another weekend deep dive. Today, we are talking about HIMSS. This company and its stock price have been on a roller coaster the last 12 months, from Super Bowl ads to legal fights with pharma giants around copycat weight loss drugs and everything else in between.
So in today's episode, we're going to break down how HIMS got here, why Wall Street got so obsessed with this company, the bull and bear case moving forward, and whether HIMS is building the future of digital healthcare or doomed for failure. We got a great one for you today. Let's dive in. Now, before we get into the bull and bear case for the company, let's start with the backstory.
HIMS was founded back in 2017 as an online native pharmacy. This was during the time when there was a boom in telehealth companies. HIMS built their brand by focusing on the awkward healthcare stuff. They provided treatment for hair loss and ED and skincare issues. The brand was very sleek and modern.
Everything was accessible through their app and the medications were shipped directly to your door. It was a huge upgrade from the traditional experience of going to a doctor's office, waiting hours at the waiting room, and then having an awkward conversation with the doctor for five minutes. So HIMS was able to find success pretty quickly.
The revenues jumped from $26 million in 2018 to $272 million in 2021, which is also the year the company went public. Now let's fast forward to 2024. This was a pivotal year for the company because this is when they moved into the GLP-1 weight loss category. See, GLP-1s had started getting popular around 2022-ish.
I remember seeing a bunch of articles and TikToks about celebrities on Ozempic and Manjaro. You know, GLP-1s were originally made to help type 2 diabetics manage their blood sugar, but they also turned out to be incredibly effective for weight loss. So everyone was trying to get their hands on them. Unfortunately, there wasn't enough supply to meet the demands.
So the FDA actually put semi-glutide, which is the active ingredient in Ozempic, on its shortage list in mid 2022. And that opened the door for HIMS to jump in. See, when a drug is added to the FDA shortage list, that allows compounding pharmacies to legally make copycat versions of the product and sell them. So HIMS started selling personalized compounded GLP-1 treatments for like $200 a month.
If you compare that to Ozempic, which was selling for $1,000 a month at the time, you can see why this was a massive hit for HIMS. Revenues in 2024 jumped 69% to $1.5 billion. Their subscribers increased 45% to 2.2 million people. And the stock price reflected all of that. HIMS went from a $10 stock in early 2024 to all-time highs of $69 in February of 2025.
You know, HIMS was kind of feeling themselves at the time. They even dropped a Super Bowl commercial in February of 2025. Well, it turns out that Super Bowl commercial might have been the peak for the company because the last 12 months have been bumpy for HIMS. HIMS was riding high in February of 2025. They had just dropped a provocative Super Bowl ad that had everyone talking.
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Chapter 2: What significant changes occurred in the GLP-1 market for Hims?
Well, then the GLP-1 environment changed again, and this time it threatened HIMS' entire weight loss business. See, two weeks after the Super Bowl, the FDA announced that semi-glutide, which is the active ingredient in Ozempic, was no longer on the shortage list.
That was a huge problem for HIMS because that shortage was the legal justification they had for selling their cheaper compounded GLP-1s. So this announcement by the FDA caused HIMS stock to drop 25% in a single day. But here's the thing though, HIMS didn't really stop selling the GLP-1 knockoffs. They just kept selling them under a different regulatory loophole.
See, compound pharmacies are still allowed to make customized medications in certain cases, even when the drug is no longer on the shortage list. They can do it for personalized treatment. And that's the loophole that HIMS was using. Well, big pharma companies like Novonordis, which is the maker of Ozempic, they finally had enough. Novonordis went on the offensive and threatened lawsuits.
But HIMS kept pushing their luck. In fact, they went a step further in early 2026. See, earlier this year, Novonordis launched the WeGovie pill. It was the first GLP-1 pill on the market, and Novonordis was selling it for around $150 to $300 a month. Well, a couple weeks after the WeGovie pill came out, HIMS came out with their own compounded oral semi-glutide pill for just $49 a month.
So HIMS was straight up copying Novo Nordisk's signature pill and selling it for much cheaper. And I think HIMS might have pushed their luck too much because the FDA immediately came out with a warning, threatened to crack down on companies making copycat GLP-1 products.
HIMS stock tanked following those comments from the FDA and the company quickly removed the GLP-1 weight loss pill from their website. Unfortunately, the cat was out of the bag. Nova Nordisk officially filed the lawsuit against HIMS on February 9th. The lawsuit alleged that HIMS was infringing on their patents and unlawfully promoting compounded versions of WeGovie and Ozempic on their website.
So that was a big deal because at that point, HIMS' biggest growth engine was facing a major legal and regulatory hurdle. At its low point this year, HIMS stock has lost half its value. But then out of nowhere, a major breakthrough emerged. So let's talk about that breakthrough and the bull case for HIMS moving forward.
On March 9th, Novo Nordisk shocked some people by announcing that they were dropping their lawsuit against HIMS and instead planning to partner with them. Under this partnership with the two companies, HIMS would sell Novo Nordisk's FDA-approved Ozempic injections and WeGovie pills and injections directly on their platform starting later this month.
And in the future, both companies have been planning to collaborate on bringing additional products to market as they became available. Now, in exchange, HIMS agreed to stop advertising and selling their compounded knockoff GLP-1s. Honestly, it seems like HIMS got the better end of this deal because these compounded GLP-1s they were selling were facing a legal and regulatory ban anyways.
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Chapter 3: How did Hims capitalize on the FDA's drug shortage list?
On top of that, HIMS continues to grow its women brand called HERS. The revenue for the HERS division grew 100% in 2025, and it's rapidly approaching the $1 billion in annual sales. And the company sees a ton of upside when it comes to adding subscribers.
Right now they have 2.5 million users, but given that more than 70% of Americans are overweight, there's plenty more room to capture more of the total addressable market just in the weight loss category.
And once these patients come on the HIMSS platform for weight loss, HIMSS can now offer more treatment options to patients who are looking for accessible and convenient care through a telehealth provider. And finally, there's also the international expansion of HIMSS business. HIMSS has been making aggressive moves overseas.
Last year, they acquired Zava, which is a European telehealth company, which gave them a presence in the UK, Germany, France, Ireland, and Spain. They also acquired a company called LiveWell to enter Canada, which is notable because Canada is expected to be one of the first markets to get access to generic semi-glutide.
And then in February of this year, HIMS signed an agreement to acquire Eucalyptus, which is a global health company that HIMS says will further strengthen their presence in the UK and Europe. It also brings the HIMS and HERS brand into new markets like Australia and Japan.
So to sum up the bull case for HIMS, you have the Nova Nordisk partnership removing the biggest overhang on the stock, the core business is still growing, the platform is expanding into new treatment categories, and there's real international growth ahead. So that's a pretty compelling bull case for the stock.
But now we gotta talk about some of the risks and the bear case the company faces moving forward. All right, now let's talk about the bear case because there are some real risks facing the company. Let's talk about the biggest one. It's a potential decline in revenue and margin. See, this partnership with Nova Nordisk is a big deal, but it's going to impact HIMSS' business model.
See, when HIMS was selling compounded semi-glutide GLP-1s, they were essentially making the product themselves through their pharmacy network and selling it directly to customers. So that meant they booked the full revenue from every sale. So when a customer paid $199 a month for their semi-glutide, HIMS kept most of that money.
But now with the branded Nova Nordisk products, the economics are completely different. According to analysts at Canaccord Genuity, when HIMS sells Novo Nordisk's FDA-approved drugs, they're likely to recognize revenue on a net basis. So that means that HIMS only books their cut of the transaction, not the full sales price. And this is where things get tricky.
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Chapter 4: What led to Hims' stock price surge in early 2025?
Thank you guys again for listening, watching, and commenting. Shout out to Mike and Connor for all the work behind the scenes. And we'll see you guys back here tomorrow.