Shares of online pharmacy Hims & Hers soared 40% amid a general sell-off. What is it?

Shares of US telemedicine platform operator and online pharmacy Hims & Hers soared more than 40% on March 9 following reports of a renewed partnership with Danish giant Novo Nordisk. The companies are preparing to announce a deal to sell weight-loss drugs through the Hims platform as early as Monday, March 9, Bloomberg reported, citing a source. The move could end a legal dispute between the companies, The Wall Street Journal (WSJ) reports. However, at the moment, neither party has officially confirmed information about the cooperation, and the terms of the agreement remain unclear.

On the background of global markets decline due to the escalation of the conflict in the Middle East and rising energy prices, shares of Hims & Hers on Monday, March 9, on the contrary, jumped in the moment by 42%, while Novo Nordisk securities added almost 2% in Copenhagen trading. Hims, which sells consumer drugs, is preparing to offer Novo Nordisk's blockbuster weight-loss drug Wegovy on its platform, an unnamed Bloomberg source said.

The agreement could end a dispute between Hims & Hers and Novo - the latter sued Hims in February for launching an analog of its new Wegovy slimming pills, a key element of the Danish manufacturer's growth strategy, Bloomberg points out. The Danish company accused Hims of infringing U.S. patents on the active ingredient behind its best-selling drugs, Ozempic and Wegovy. At the time, Novo's general counsel John Kuckelman called Hims' actions "egregious."

However, last Friday, March 6, a Novo spokesperson changed the rhetoric, stating that the company is "continually engaged in dialogue with organizations that can improve patient access to FDA-approved drugs for chronic diseases."

Novo Nordisk's decision to renew its collaboration points to the pressure the company is feeling in the competitive market for obesity drugs, TipRanks notes. Prescription compounding platforms such as Hims have flooded the market with cheaper copies of the drugs, Bloomberg writes.

At the same time, Eli Lilly is poaching patients with its competing drug Zepbound, which has shown greater weight loss than Wegovy in clinical trials, Bloomberg adds.

The announcement of a possible truce between the companies came at a time when both are having a bad time on the stock exchange, Barron's points out. Novo Nordisk's American depositary receipts fell more than 20% in 2026 after the company issued a disappointing outlook for the current year, in which it said sales were expected to decline. Meanwhile, Hims shares collapsed more than 30% over the same period as investors seriously feared the impact of a lawsuit from Novo and increased scrutiny from state regulators.

Leerink analyst Michael Cherney called the news of Hims' renewed partnership with Novo "both unexpected and a definite positive for Hims stock," Reuters writes. He said the deal indicates that Novo is expanding its distribution network, and the broad consumer reach on the Hims platform makes it an attractive sales channel once legal hurdles are cleared.

Morgan Stanley analyst Craig Hettenbach holds a similar view. He noted that the partnership reduces legal and regulatory risks for Hims' underweight business. This could trigger a "powerful rebound in stocks" that had a large number of short positions (shorts) open earlier, TipRanks reported.

However, the financial implications for Hims remain uncertain. Barclays analysts pointed out in a note that if the deal is confirmed, Hims could give users access to NovoCare's pharmacy at about $149 per month per drug. That would provide Hims with much lower margins than its own combination products. Nevertheless, Barclays emphasized that any agreement that avoids years of litigation would be an absolute plus for Hims.

Citi analyst Daniel Grosslight estimates that if Hims stops making its cheap copies of the drugs and switches to reselling the originals from Novo Nordisk, it would have to attract 70% more customers just to maintain the same level of profit, MarketWatch writes.

Most Wall Street experts are now taking a wait-and-see stance on Hims stock, with four analysts recommending buying the stock, 12 recommending holding and one recommending selling.

The situation is similar for Novo securities: seven analysts following Novo shares recommend buying the Danish pharma producer's securities, while 16 recommend holding.

This article was AI-translated and verified by a human editor