After the FDA decided to remove Eli Lilly and Co's Tirzepatide from the pharmaceutical shortage list, a lawsuit related to this delisting led to Hims & Hers Health (HIMS.US) rising by about 10% on Monday.
According to the Zhìtōng Cáijīng app, following the FDA's decision to remove Eli Lilly and Co's Tirzepatide from the pharmaceutical shortage list, a lawsuit related to this delisting prompted an increase in trading for Hims & Hers Health (HIMS.US) on Monday, with a rise of 9.68%. This lawsuit has led the FDA to reconsider the delisting. Tirzepatide is sold under the names Mounjaro and Zepbound, and is used to treat type 2 diabetes and obesity.
On October 7th, the Outsourcing Facilities Association, representing compound pharmacies, filed a lawsuit in a federal court in Texas, claiming that the FDA made a "reckless and arbitrary decision" in depriving consumers of access to Tirzepatide. The organization claims that Tirzepatide is still in short supply and demands that the FDA revoke its decision.
It is reported that if a branded drug is recognized by the FDA as scarce, the rules allow compound pharmacies to continue producing the drug still under patent protection. Previously, Eli Lilly and Co had resolved the shortage issue of Tirzepatide and informed the FDA, which has now determined that the supply issue of this type of drug has been resolved and thus removed the drug from the list.
This means that, according to FDA guidelines, compound pharmacies will no longer be allowed to produce and sell generics of these drugs. For patients who cannot afford the expensive original drugs, it may mean losing access to these weight loss medications.
On October 11th, the FDA stated that they would not take regulatory action against compound pharmacies and facilities producing their own version of Tirzepatide until their review is complete.
This decision is good news for remote medical companies like Hims & Hers Health, as they can continue to provide compounded versions of weight loss drugs. As a result, Hims & Hers Health's stock price rose by about 10% in Monday's trading.