HIMS - It's Complicated.
Is a Short Squeeze possible?
Him’s & Her’s HIMS 0.00%↑ has had quite a crazy last 12 months. Over the last year, HIMS focused heavily on expanding access to the booming GLP-1 weight-loss drug market. On this thesis the stock took off from the mid teens all the way up to $70/share. The company started offering compounded semaglutide therapies off-brand (the same active ingredient in blockbuster GLP-1 drugs Ozempic and Wegovy) at much lower prices than brand-name alternatives. This was only allowed under an FDA supply exemption (or so they thought). This strategy helped drive strong subscriber growth and revenue, but it also exposed the company to regulatory and legal troubles because compounded variants aren’t FDA-approved and were only historically permissible under specific shortage-based exemptions.
In mid-2025, a collaboration between HIM’s and Novo Nordisk NVO 0.00%↑ to expand access to GLP-1 drugs ended abruptly amid concerns about “illegal mass compounding” and questionable marketing practices, sparking a sharp drop in HIMS stock and investor lawsuits alleging misleading disclosures. Meanwhile, regulatory bodies including the FDA and HHS began scrutinizing HIMs’ practices and even referred the company to the Department of Justice for potential violations of federal drug laws.
Instead of showing caution amid growing regulatory pressure, HIMS management appeared to double down by pursuing initiatives that critics argue push even closer to the edge of regulatory compliance, and generally pissed of a former partner.
In early 2026, HIMs launched a compounded oral GLP-1 pill intended to compete with Novo’s newly approved Wegovy pill at a fraction of the price. That move backfired quickly as the FDA flagged the offering as unlawful, HIM’s pulled it within days, and on February 9, 2026, Novo Nordisk filed a patent infringement lawsuit, alleging that HIMs’ compounded semaglutide products infringed its U.S. patents and seeking damages and a permanent injunction. The legal challenge, coupled with tightening FDA restrictions on compounded GLP-1 ingredients and ongoing federal scrutiny, has significantly weighed on HIMS’ share price and cast doubt on the future of its weight-loss segment.
So much so that the stock currently has a short interest between 36% and 39% (depending on the day you look and the data provider). Is this enough to incite a short squeeze?
