Lilly taking ‘aggressive stance’ with virtual health partners, says Citi

Citi reports that Eli Lilly’s (LLY) CFO said while presenting at an investor conference this morning that when the company partners with virtual health companies, they require those companies to stop offering compounded tirzepatide and semaglutide. Two of Lilly’s partners, LifeMD (LFMD) and Noom, still do offer compounded GLP-1s, so “it is unclear to us how aggressively” Lilly is policing this restriction, but the analyst thinks it is unlikely that Hims & Hers (HIMS) will partner with Lilly if this restriction holds given that Citi thinks the majority of weight-loss revenue this year will be derived from personalized GLP-1s. If Hims does end up partnering with Lilly, it would signal that the company is “throwing in the towel” on compounded GLP-1s as they think the volume benefit of a branded partnership will offset lost compounded gross profit, added the analyst, who keeps a Sell rating and $30 price target on Hims & Hers shares.