Hims & Hers cuts 4% of staff after FDA ban on generic weight-loss drugs
CALIFORNIA, UNITED STATES — Telehealth company Hims & Hers Health Inc. is laying off 68 employees, representing 4% of its workforce, as it moves away from selling low-cost alternatives to popular weight-loss medications.
The move comes following a U.S. Food and Drug Administration (FDA) ban on compounded versions of the popular weight-loss drug Wegovy, produced by Novo Nordisk.
Strategic pivot away from generic weight-loss drugs drives layoffs
Hims & Hers capitalized on shortages of Wegovy and Zepbound by offering cheaper alternatives, fueling rapid expansion. With the FDA ban in effect, the company is now pivoting away from generic weight-loss medications and refocusing its business strategy.
The layoffs reflect this recalibration, with affected roles distributed among various divisions, although the specific positions have not been disclosed.
The company has since partnered with Novo Nordisk to sell discounted Wegovy, signaling a move toward branded medications.
Analysts note that cost advantages for generics have diminished, forcing Hims & Hers to emphasize personalized care and convenience instead. This transition aligns with Chief Executive Officer (CEO) Andrew Dudum’s long-term roadmap, which prioritizes AI integration and blood testing for tailored treatments.
“While not easy, this step reflects our commitment to invest in the areas that will define our future,” a spokesperson for the company told Bloomberg.
“As part of this broader change, we will continue to actively hire for roles critical to our long-term strategy,” the spokesperson added.
Expansion into new health markets amid $1Bn funding push
Beyond weight loss, Hims & Hers is targeting menopause and low testosterone treatments to diversify revenue streams. The company recently secured $1 billion in funding to accelerate international growth and enhance its telehealth platform.
According to Leerink Partners analyst Michael Cherny, the focus is shifting from affordability to AI-driven personalization, a key differentiator in the competitive digital health space.
The pivot could impact U.S. hospitals and clinics partnering with the firm, as its emphasis shifts from generic medications to higher-margin, specialized care—potentially altering cost structures for healthcare providers.
Minimal impact on U.S. healthcare partners
The firm’s network includes partnerships with major health systems, such as ChristianaCare, expanding its reach to in-person care across multiple states, including Delaware, Maryland, New Jersey, and Pennsylvania.
While Hims & Hers partners with various health systems, the layoffs are internal and primarily affect the company’s own workforce.
There is no indication that hospitals, clinics, or external health systems employing or partnering with Hims & Hers will be directly impacted by the layoffs, as the reductions are confined to the telehealth firm’s staff and not on its networks.
The broader healthcare ecosystem that collaborates with Hims & Hers is unlikely to see disruptions in service or access as a result of these internal changes.
