Hims & Hers stock tumbled after the FDA announced plans to restrict GLP-1 compounded drugs, with shares falling up to 27% Monday. The agency vowed to curb misleading advertising claims about non-FDA-approved GLP-1s, including those sold by Hims & Hers, which markets cheaper compounded versions of drugs like Ozempic. The FDA warned companies cannot assert compounded drugs are clinically proven or identical to approved versions, citing deceptive marketing tactics.

This regulatory shift follows a lawsuit by Novo Nordisk, which accused Hims & Hers of infringing on Ozempic’s intellectual property. The stock has dropped 50% this year, closing below $17 Monday—down from a February 2025 high of $68. Investors fear the FDA’s actions could cripple the company’s business model, which relies on compounding GLP-1 APIs into weight-loss medications.