The U.S. Food and Drug Administration (FDA) Commissioner Marty Makary stated publicly on Thursday evening that the agency will take swift regulatory action against the large-scale marketing of "unapproved generic drugs." This declaration directly impacted telehealth company Hims & Hers Health Inc., whose stock price fell immediately.

Makary emphasized on social media platform X that the FDA "cannot verify the quality, safety, or efficacy of unapproved drugs." This statement coincided with Hims & Hers Health Inc.'s launch of a $49-per-month generic version of the oral weight-loss drug Wegovy, priced at just one-third of the monthly cost of the original drug from Novo-Nordisk A/S. As a result, Hims & Hers Health Inc.'s stock dropped 5.7% during Friday's trading session.

This regulatory development comes as Novo-Nordisk A/S faces multiple pressures. The company's stock plummeted 20% this week, first due to annual revenue guidance falling significantly below market expectations, and subsequently facing competitive threats from Hims & Hers Health Inc.'s low-cost generic. Although it recovered slightly on Friday, its stock is still on track for its worst weekly performance in nearly six months.

For investors, this marks a critical phase in the competition within the GLP-1 class of weight-loss drugs. Goldman Sachs analyst James Quigley previously noted that fiscal year 2026 would be a "reset year" for GLP-1 market pricing, and the FDA's rapid intervention further indicates that regulatory sentiment is tilting towards protecting the interests of originator drug companies.

The challenge from generic drugs has triggered a regulatory counterattack. Hims & Hers Health Inc. announced on Thursday the launch of a $49-per-month oral GLP-1 weight-loss drug, priced at just one-third of Novo-Nordisk A/S's comparable Wegovy product. This move is seen as a significant signal that competition in the GLP-1 market is entering a price war phase, with the company aiming to quickly capture market share through a low-price strategy.

Novo-Nordisk A/S promptly stated it would respond using legal and regulatory measures. In fact, the cooperative relationship between the two companies ended in June of last year, at which time Novo-Nordisk A/S accused Hims & Hers Health Inc. of "illegal large-scale compounding and misleading marketing practices."

J.P. Morgan analyst Richard Vosser noted in a research report that Novo-Nordisk A/S has solid legal grounds to demand the removal of this product from the market, and believes Hims & Hers Health Inc.'s generic drug "clearly violates U.S. drug regulations."

Since reaching a peak market capitalization of $659 billion in June 2024, Novo-Nordisk A/S has seen its market value evaporate by over $460 billion, now standing at just over $200 billion. This former European market leader has rapidly fallen out of the top ten global companies by market capitalization.

This week's sharp stock decline is just the latest manifestation of the company's continuous challenges. Throughout 2025, Novo-Nordisk A/S recorded its worst annual stock performance in history, primarily impacted by intensified competition in the obesity drug market, clinical trial data falling short of expectations, and multiple profit warnings. Its stock performance has nearly erased all the gains previously achieved during the "weight-loss drug boom."

Mizuho healthcare analyst Jared Holz pointed out: "It is clear that if Novo-Nordisk A/S had never entered the obesity treatment market, its current stock price level would be higher."

Novo-Nordisk A/S CEO Mike Doustdar admitted during an analyst meeting on Thursday: "The experiences of the past year have given us a profound understanding that the dynamics of the obesity drug market far exceed our previous knowledge and expectations."

Competitive pressures continue to intensify. Novo-Nordisk A/S was initially a small manufacturer focused on insulin. Its turning point came after its diabetes drug Ozempic (semaglutide injection) gained attention in Hollywood celebrity circles. The company subsequently repurposed the same active ingredient specifically for weight loss as Wegovy, which received U.S. regulatory approval in June 2021, propelling the stock into a rapid upward trajectory.

However, despite its first-mover advantage, Novo-Nordisk A/S underestimated the intensity and speed of market competition. The company continues to face pressure from its main U.S. rival, Eli Lilly, which launched the weight-loss drug Zepbound in late 2023, while both companies also face market pressure from low-cost generic drugs.

CEO Doustdar acknowledged this, stating: "Price is undoubtedly a key factor affecting the scale of the business, and we have clearly seen this from the market penetration of compounders. Consumer choice of generic drugs is not due to preference but stems from the affordability pressure of originator drug prices. We failed to fully anticipate the speed and breadth of their market coverage."

The launch of an oral formulation of Wegovy in January of this year provided Novo-Nordisk A/S with a temporary advantage, driving its stock to its largest gain in five months. However, subsequent disappointing sales outlooks and the launch of Hims & Hers Health Inc.'s low-cost generic have again put pressure on the stock price.

Currently, among the 34 analysts tracked by Bloomberg, less than half maintain a "Buy" or equivalent rating. Even the most optimistic among them believe the stock is unlikely to return to its historical highs within the next 12 months.