Hims & Hers Health Share Decline

Hims & Hers Health saw its shares decline by more than 6% on Tuesday morning due to Eli Lilly (NYSE: LLY)’s latest announcement.

Eli Lilly’s New Offering

Lilly has introduced single-dose vials of its obesity medication, Zepbound, priced at a 50% discount compared to other incretin medicines. This launch comes amidst increasing competition in the obesity treatment market.

Pricing Details

The new vials include:
– 2.5 mg vial priced at $399 for a four-week supply
– 5 mg vial priced at $549 for a four-week supply

These prices significantly undercut the list prices of competing medications.

Availability

The vials will be available through Lilly’s direct-to-patient service, LillyDirect, providing more affordable options for those paying out-of-pocket, without insurance coverage.

Analyst Insights

According to Citi analysts, Lilly’s initiative signals a warning for companies involved in the GLP-1 compounders market, including Hims & Hers Health.

They believe Lilly’s strategy aims to address issues related to counterfeit and unsafe products, presenting a direct challenge to compounded alternatives in the market.

Hims & Hers Health Impact

Currently, Hims & Hers offers compounded semaglutide, which may face increased competition from the branded option of Zepbound. Due to its brand assurance, the single-dose vials are expected to boost consumer confidence and could affect companies like Hims & Hers.

The implications of Lilly’s new pricing strategy may worsen market pressures on similar competitors, including Hims & Hers.