Analysts and investors have turned their attention to a key regulatory meeting on peptides, a decision expected to trigger HIMS’ next phase of growth.
- The Pharmacy Compounding Advisory Committee is set to meet next month to determine whether seven peptides are added to the 503A bulk substances list.
- Leerink sees potential approval as an upside catalyst for Hims’ growth outlook beyond 2027.
- HIMS shares are trading above the $30 level, a key level that acted as resistance in April and triggered a period of selling pressure in the following weeks.
Hims & Hers Health Inc (HIMS) was back in the spotlight, with investors eyeing the outcome of a key regulatory meeting to deliberate on the inclusion of peptides 503A Bulk List, a move that would allow compounders to produce them.
HIMS shares have been trending higher lately, soaring more than 20% so far this month, while also climbing past a key resistance level.
Leerlink Says Outcome Of Meeting On Peptides To Determine HIMS’ Growth Prospects
On Tuesday, Leerink reiterated its ‘Market Perform’ rating and maintained a $25 price target ahead of the Pharmacy Compounding Advisory Committee meeting, which could impact the company’s future growth prospects.
The meeting, set to take place on July 23 and 24, will consider whether seven peptides should be added to the FDA’s 503A Bulk List. Leerink said peptides could become the next major product category for Hims & Hers, supporting growth beyond 2027.
The firm described the meeting as a potentially important catalyst for the stock, although the outcome remains uncertain. Even if the committee votes in favor, the FDA will make the final decision.
Earlier this week, FirstWave Fund CEO Jonah Lupton said Hims & Hers could generate between $10 billion and $19 billion in annual peptide-related revenue by 2030 if it captures just 4% to 5% of the combined GLP and non-GLP peptide markets.
Near-Term Focus On GLP-1 Business
Despite the long-term opportunity from peptides, Leerink said investor focus is likely to remain on near-term growth and profitability trends in the company’s GLP-1 business.
The company’s recent acquisition of Eucalyptus has expanded its business across the U.S., U.K., Australia, and Canada. Last week, its recently acquired Juniper platform began pre-orders for Novo Nordisk’s blockbuster Wegovy pill in the United Kingdom, a day after the oral version of the GLP-1 drug was approved in the country.
Looking Beyond GLP-1s
The focus on peptides comes as investors continue to assess what Hims’ growth profile could look like beyond the compounded GLP-1 medications. According to a recent Morningstar report, weight-loss treatments were a major contributor to its expansion plans, but it expects GLP-1 revenues to face pressure due to regulatory actions and the resolution of branded drug shortages. The analysts also noted that Hims typically targets one or two new specialty launches each year.
Regulatory Risks Weigh
Earlier this week, the FDA issued warning letters to 25 telehealth companies over allegedly false or misleading marketing claims related to compounded versions of popular GLP-1 drugs from Eli Lilly and Novo Nordisk, according to Reuters. However, Hims was reportedly not among the companies identified.
Morningstar currently assigns Hims a "Very High" uncertainty rating, citing ongoing questions around the company's weight-loss portfolio, potential regulatory changes affecting compounders and the long-term impact of litigation and policy decisions.
HIMS Stock Trades Above Key Resistance
Hims & Hers shares are now trading above the $30 level, a key area that acted as resistance in April and triggered a period of selling pressure in the weeks that followed. HIMS stock is up around 1% at close to $31.8 at the time of writing.
What Is Retail’s Take On HIMS?
Retail sentiment surrounding HIMS on Stocktwits turned to ‘bullish’ from ‘neutral’ a day earlier, accompanied by high message volumes.
One user said the stock would ‘explode’ if peptides were approved for addition to the bulk list.
View this Stocktwits post
Another user highlighted $32 as the current resistance level, and a failure to break it could trigger a 7-10% sell-off.
View this Stocktwits post
The stock has shed nearly 7% of its value so far this year.
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