US could take action including fines against Hims after brief Wegovy copy launch

The Trump administration could take action including an injunction or fines against online telehealth company Hims for intending to sell a compounded version of Novo Nordisk’s Wegovy weight-loss pill, though its legal options may be curbed by Hims’ quick retreat, attorneys and other experts told Reuters.

Hims and Hers Health last week said it would offer a much cheaper $49 version of Novo Nordisk’s Wegovy weight-loss pill, before backing off the plan after the Food and Drug Administration said it would take steps against the company.

The FDA has since referred Hims to the Department of Justice for potential legal violations, according to Department of Health and Human Services general counsel Mike Stuart.

The Justice Department could seek a court injunction or civil or criminal fines against Hims for violating the Food, Drug and Cosmetic Act by marketing an unapproved drug, said three attorneys.

In response to questions about the agency’s next legal steps, HHS pointed to Stuart’s prior statements.

WEIGHT-LOSS DRUGMAKERS SCRAMBLE TO MEET SURGING DEMAND

Stuart told CNBC on Monday that the agency’s actions were in part motivated by protecting the investment that pharmaceutical companies have made in pursuing traditional FDA approval, and in ensuring the products are safe.

“When you look at compounders versus the pharmaceutical industry generally, these compounders haven’t spent that inordinate amount of money making sure that they’re safe and effective,” he said.

Hims did not respond to a request for comment.

Weight-loss drug manufacturers including Novo and rival Eli Lilly have scrambled to meet skyrocketing demand for their blockbuster products. Drugmakers have argued that some compounders, which mix drug ingredients to create customized pharmaceuticals, are illegally marketing unapproved copies of their products.

Compounded pharmaceuticals are legal in the U.S. under narrow provisions of the Food, Drug, and Cosmetic Act, meant to allow production of drugs during a shortage or when a patient requires personalization due to medical concerns.

Without those conditions, the FDA can take enforcement actions against drug compounders when they essentially sidestep the federal drug approval process by manufacturing products already available for commercial sale, three attorneys told Reuters.

Hims has argued its products are legal because they are tailored to patients’ medical needs.

PERSONALIZED OR NOT?

At question is whether Hims’ products are sufficiently personalized to be allowable under federal law, which is difficult to ascertain due to a lack of public information about the company’s manufacturing and prescription practices, said two attorneys with expertise in FDA regulations.

As a next enforcement step, the FDA could inspect Hims’ records to evaluate whether their prescriptions are properly documented, alone or in coordination with state regulators that license compounding pharmacies, said Nathan Beaver, partner at Foley and Lardner.

Because Hims said on Saturday that it will no longer offer the compounded weight-loss pill, the Department of Justice could decide not to take action against the company after all, said James Boiani, an attorney at Epstein, Becker & Green, P.C.

“If Hims has already stepped back and is saying we’re not going to do this, it’s not clear there’s a case or controversy here,” he said.

The administration could turn its attention to Hims’ compounded injectable weight-loss drugs, which are also based on the active ingredient semaglutide found in Novo’s Wegovy.

It would face a more complex case due to the varied dosages and inactive ingredients in injectables that compounders can more easily argue are permitted under the law, said James Shehan, chair of the FDA regulatory practice at Lowenstein Sandler and former general counsel for Novo Nordisk.

FDA, DOJ TO WORK TOGETHER

To pursue legal action, the FDA needs the assistance of the Justice Department because the agency lacks independent litigating authority, attorneys told Reuters.

The agencies typically work closely together, with the FDA’s counsel’s office providing interpretation of the Food, Drug and Cosmetic Act while the Justice Department leads litigation, Shehan said.

“If the FDA refers something, then Justice typically acts on it,” Shehan said.

HHS sent warning letters last September to Novo, Hims and other companies warning them about misleading advertising. The FDA on February 5 told Novo that a television advertisement for its weight-loss pill misleadingly suggested that Wegovy offers an advancement or improvement over other GLP-1 drugs.