Hims & Hers Stock Plunges After FTC Sues Over Alleged Privacy Violations -- Barrons.com

By Mackenzie Tatananni

Shares of Hims & Hers Health sank Wednesday after the Federal Trade Commission filed a lawsuit against the telehealth provider, accusing it of sharing customers' medical information with third-party advertisers.

In a complaint filed in federal court, the FTC -- along with the states of Utah and California -- accused Hims of "deceptive and unlawful privacy practices," including sharing sensitive details about a patient's health with Snap and Facebook parent Meta Platforms.

Moreover, the FTC alleged, Hims fails to disclose that it charges consumers for prescriptions almost immediately after they submit an intake form. The agency further claims that Hims makes it difficult for consumers to cancel subscriptions and misleads consumers about keeping their information private.

Shares plunged 12% to $25.75 on Wednesday, pacing toward their lowest close in two months, according to Dow Jones Market Data. Counting the latest losses, the stock has fallen more than 20% this year.

The legal drama is just the latest setback for Hims following its pivot from large-scale compounding. The company rose to prominence amid a shortage in GLP-1 medications, sold under brand names like Zepbound and Wegovy, and commonly referred to as "weight-loss drugs."

Hims sold non-branded versions of the drug semaglutide, the active ingredient in Novo Nordisk's Wegovy and Ozempic. The company seized a legal framework allowing it to circumvent Food and Drug Administration approval for its products.

The move sparked backlash from major drugmakers and regulators alike. Novo agreed in March to drop a patent infringement lawsuit in exchange for the telehealth provider's commitment to sell branded Ozempic and Wegovy through its online pharmacy.

Hims ultimately agreed to halt production of its own compounded GLP-1 drugs and sell a range of FDA-approved products instead.

Tirzepatide maker Eli Lilly became the latest to receive a concession in April, as Hims announced that it would allow providers on its platform to prescribe scripts filled by independent pharmacies like LillyDirect.

While management has repeatedly asserted that compounded GLP-1s were a fraction of the business, Hims stock has come under pressure as investors question the company's new role. One potential direction is peptide manufacturing, aligning with the Trump administration's policy push.

Now, the lawsuit is another headache for the company. Hims stands accused of violating state-specific consumer protection statutes, particularly California's Unfair Competition Law and False Advertising Law, as well as Utah's Consumer Sales Practices Act.

The plaintiffs are asking for six specific remedies to address the alleged illegal practices. These include a permanent injunction forcing Hims to stop breaking consumer protection laws, and statutory fines levied against the company for each individual violation of state legislation.

Hims directed Barron's to a statement posted on social media when approached for comment.

"The lawsuit disregards substantial evidence we provided the FTC during its nearly three-year investigation, ignores established state laws and industry standards in telehealth, and contorts the law to try to manufacture claims," the statement reads, in part.

Rather than being grounded in consumer protection, Hims said, the effort is meant "to generate headlines at our expense."

The company has vowed to defend itself against what it calls "baseless claims."

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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July 29, 2026 15:28 ET (19:28 GMT)