Hims & Hers Stock Drops After Evernorth Announces Cheaper Pricing For Weight-Loss Drugs: Retail’s Dull

Shares of telehealth provider Hims & Hers Health Inc. (HIMS) dropped over 3% on Thursday after Cigna Group’s (CI) Evernorth division announced that it would cap out-of-pocket costs at $200 per month for patients using the weight-loss drugs Wegovy and Zepbound.

This presents a cheaper alternative to the company’s offerings.

Evernorth announced the offer on Wednesday and said it achieved the new pricing through direct negotiations with manufacturers Novo Nordisk (NVO) and Eli Lilly and Co. (LLY). The offer, it said, would result in savings of as much as $3,600 per year for patients.

Brokerage Truist on Thursday noted that the $200/month price point is "highly attractive compared to other price points in the market," including Hims & Hers' (HIMS) compounded Semaglutide, Wegovy, and Liraglutide subscription programs.

Truist has a ‘Hold’ rating on HIMS and a $45 price target.

Hims & Hers announced a partnership with Wegovy maker Novo Nordisk in late April, allowing the drug to be sold through its platform for $599 a month. This also includes the cost of a Hims & Hers membership.

Citi believes that Evernorth’s offer will cause a "slight headwind" in Hims & Hers' partnership with Novo, given the difference in pricing.

Citi, less bullish than Truist, has a ‘Sell’ rating on the stock with a $30 price target.

On Stocktwits, retail sentiment around HIMS stayed unchanged in the ‘bearish’ territory over the past 24 hours, coupled with ‘low’ message volume.

Shares of Hims & Hers fell to as low as $51.2 on Thursday before paring back some losses.

HIMS stock has more than doubled its value this year and tripled over the past 12 months.

Also See: Novo Nordisk To Sell Wegovy For $199 A Month As Compounding Ban Nears: Retail’s Bullish

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