Novo Nordisk cuts off Hims & Hers over knockoff Wegovy — and the stock plummets 27%

Novo Nordisk said Monday that it was ending its partnership with Hims & Hers, accusing the telehealth company of "deceptive promotion and selling of illegitimate, knockoff versions" of its weight loss drug Wegovy.

The termination, which means Wegovy will not longer be available on Hims & Hers, sent Hims & Hers stock plummeting, with shares down almost 27% in Monday morning trading. Novo Nordisk stock fell about 5%.

Novo Nordisk, the Danish pharmaceutical giant behind the weight loss drugs Ozempic and Wegovy, said Hims & Hers "has failed to adhere to the law which prohibits mass sales of compounded drugs under the false guise of 'personalization' and are disseminating deceptive marketing that put patient safety at risk."

"Novo Nordisk is firm on our position and protecting patients living with obesity," Dave Moore, Novo Nordisk's executive vice president for U.S. operations, said in a statement. "When patients are prescribed semaglutide treatments by their licensed healthcare professional or a telehealth provider, they are entitled to receive authentic, FDA-approved and regulated Wegovy. We will work with telehealth companies to provide direct access to Wegovy that share our commitment to patient safety — and when companies engage in illegal sham compounding that jeopardizes the health of Americans, we will continue to take action."

Hims & Hers didn't immediately comment to CNBC and Reuters.

The telehealth company announced in April that it would begin offering Wegovy on its platform, with a price point starting at $599.

“Bringing our teams together and continuing to explore our shared commitment and focus on delivering the future of healthcare has been inspiring,” Hims & Hers founder and CEO Andrew Dudum said in a statement about the Novo Nordisk partnership at at the time. “We share a vision of what consumer-centered healthcare looks like, and this is just the first step towards delivering that future.”

Novo Nordisk framed deals with Hims & Hers and with other telehealth platforms as a way to expand its customer base as the federal government cracks down on compounded versions of Wegovy. Pharmacies can make customized versions of drugs that are considered by the Food and Drug Administration to be in shortage, but the FDA declared in February that the semaglutide shortage was over. Pharma companies including Novo Nordisk and Eli Lilly have taken legal action against compounding pharmacies since then.

—Kevin Ryan contributed to this article.