Recent price drops in Hims & Hers (HIMS) may present a buying opportunity for long-term investors. The market appears overly focused on its GLP-1 business, ignoring significant growth potential in other areas like hormone therapy and urgent care. Consider an investment in Viatris (VTRS), which recently won a major patent battle against Novo Nordisk for its blockbuster drug semaglutide. This victory is a significant catalyst for a generic version of Wegovy in the U.S. that is not yet fully priced into the stock. The weakening patent monopoly for major GLP-1 drugs is creating key opportunities for these more diversified telehealth and generic providers.

Hims & Hers Health, Inc. (HIMS)

• The speaker is a long-term, bullish investor in HIMS, viewing it as the potential "Netflix of healthcare."
• The stock is described as having extremely high volatility, making it a popular choice for options traders. The podcast highlights a recent instance where the stock dropped over 8% in one day due to a news article about a letter from lawmakers concerning GLP-1s.
• The speaker argues that the market is overly focused on the GLP-1 story, which is HIMS's fastest-growing segment but not its only business.
  • The weight loss category (including GLP-1s) currently accounts for roughly 15% to 20% of revenue.
  • The speaker projects that GLP-1s will represent less than 30% of HIMS's total revenue by the end of 2025, indicating significant growth is expected in other areas.
• The podcast identifies several positive catalysts that the speaker believes are being ignored or are not fully "priced in" by the market:
  • New FDA Commissioner: The new head of the FDA was previously the Chief Medical Officer at Sesame, a telehealth company that also sells compounded GLP-1s. This is seen as a major positive for the regulatory landscape for companies like HIMS.
  • Existing Product Offerings: The market seems to be forgetting that HIMS is already selling FDA-approved generic liraglutide for $199/month. This is seen as a potential fit for the growing "micro-dosing" trend.
  • Canadian Market: Novo Nordisk lost its patent for semaglutide in Canada for failing to pay a $250 fee, opening a significant new market for generic providers like HIMS.
• The speaker emphasizes that HIMS has successfully grown through different phases, previously being criticized as "just an ED company" and later for selling SSRIs for anxiety, suggesting the current focus on GLP-1s is another temporary phase.
• Future growth segments for HIMS are expected to be:
  • Hormone Replacement Therapy (e.g., Testosterone)
  • Menopause treatments
  • Diabetes care
  • Urgent Care (telehealth consultations)

Takeaways

• The long-term investment thesis for HIMS is based on its diversification into multiple areas of telehealth, not just the currently popular GLP-1 weight-loss drugs.
• The speaker suggests that sharp, news-driven price drops, such as the one caused by the lawmakers' letter, may represent buying opportunities for long-term investors, as the market is overreacting to short-term headlines.
• Investors should look beyond the GLP-1 narrative and consider the company's expansion into other large healthcare markets like hormone therapy, diabetes, and urgent care as the core of the investment case.

GLP-1 Market & Related Companies

• The discussion centers on the disruption of the GLP-1 market, which has been dominated by large pharmaceutical companies.
• Viatris (VTRS): Through its subsidiary Mylan, Viatris recently won a significant patent feud against Novo Nordisk regarding semaglutide. This is a major step toward clearing the way for a generic version of the popular drug Wegovy in the U.S. The speaker believes this hugely positive news has not been adequately priced into the market.
• Novo Nordisk (NVO): The maker of Ozempic and Wegovy is facing significant challenges to its patent monopoly.
  • It lost a key patent battle to Viatris in the U.S.
  • It lost its semaglutide patent in Canada due to an administrative error (failing to pay a $250 fee).
• Risk Factor Mentioned: The FDA may crack down on the "wild west" of the GLP-1 market. This refers specifically to websites selling unapproved, "for research only" peptides like retatrudide or dangerous salt-form versions of semaglutide. The speaker believes legitimate compounders like HIMS are not the target of this concern.
• Transmedics (TMDX): This company was mentioned as a historical example. About nine months ago, a letter from lawmakers caused the stock to drop significantly. The stock has since recovered and is up 50%, illustrating that such politically-driven events can be temporary setbacks.

Takeaways

• The patent protection for blockbuster GLP-1 drugs from giants like Novo Nordisk is weakening. This presents a major opportunity for companies that can offer lower-cost generic or compounded alternatives, such as HIMS.
• The victory by Viatris (VTRS) in its patent dispute is a significant catalyst for the entire generic drug space and signals a shift in the market.
• Regulatory or political headlines can create significant short-term volatility and potential entry points for investors, as the market reaction may be temporary and not reflective of a company's long-term fundamentals. The Transmedics (TMDX) example supports this view.