Mounting Regulatory and Legal Challenges Pressure Hims & Hers Stock

The telehealth company Hims & Hers finds itself navigating a perfect storm of regulatory scrutiny and legal action, leading to significant pressure on its share price. The stock has lost more than half its value since the start of the year as several critical issues converge.

Legal Repercussions from Weight-Loss Drug Venture

A primary source of tension stems from the company’s brief foray into offering unapproved, compounded weight-loss medications. According to a Reuters report, the U.S. Food and Drug Administration (FDA) has referred Hims & Hers to the Department of Justice (DoJ). This action followed the FDA’s stated intention to take decisive steps to restrict GLP-1 ingredients in compounded drugs that lack its approval.

Legal experts suggest the government could seek an injunction or pursue civil and criminal penalties, citing potential violations of the Food, Drug and Cosmetic Act for allegedly marketing an unapproved drug. However, attorneys noted to Reuters that the company’s swift withdrawal of its $49 semaglutid pill may limit the regulatory options available to authorities.

Short Sellers Circle as Volatility Spikes

Concurrently, bearish sentiment against the company has intensified. Data cited by Reuters shows that in January, the proportion of shares lent out for short selling reached nearly 65% of the available float. This marked the highest level since October 2025, based on a dataset tracking over 600 asset managers.

Separate LSEG data indicated that the short interest itself hit a record high on February 12. The equity has exhibited correspondingly high volatility and remains down over 50% year-to-date.

Should investors sell immediately? Or is it worth buying Hims & Hers?

Patent Infringement Lawsuit from Pharma Giant

Adding to its legal woes, Novo Nordisk filed a patent infringement lawsuit against Hims & Hers in the U.S. on February 9. Reuters reported this is the first such lawsuit by Novo against a compounder related to its Wegovy weight-loss drug. The company’s chief legal officer stated they are seeking “a very substantial amount” in damages.

Hims & Hers responded on social media platform X, characterizing the lawsuit as an “open attack” by a Danish corporation on millions of Americans who rely on compounded medicines to access personalized care.

Upcoming Earnings as a Critical Test

All eyes now turn to the company’s upcoming financial report, which will serve as the first major test for management amid this multifaceted crisis. According to MarketBeat, Hims & Hers is scheduled to release its Q4 2025 results after the U.S. market close on Monday.

Analysts anticipate earnings per share of $0.04 and quarterly revenue of $619.48 million. The stock recently opened at $16.31 per share, with a 52-week range of $15.63 to $72.98. Its market capitalization is approximately $3.71 billion.

Monday’s earnings call will provide the executive team its first formal opportunity to address stakeholders amidst a landscape shaped by potential DoJ action, the FDA’s stance on GLP-1 drugs, and the ongoing Novo Nordisk litigation. The market’s focus will be squarely on how management navigates these simultaneous challenges.