Novo can now meet the demand for Ozempic and Wegovy (both semaglutide) nationwide, the Food and Drug Administration said Friday. The ruling shows Novo’s confidence that the supply of Ozempic will be stable for now. It’s also a sign that the billions of dollars the drugmaker has poured into factory construction are paying off. That puts the Danish drugmaker into a better position to compete with U.S. rival Eli Lilly & Co. in the fast-growing market for obesity treatments.

“This update comes after ongoing dialogue with the FDA, and substantial efforts by Novo Nordisk to increase manufacturing capacity, including $6.5 billion of investments in the U.S. this year alone,” the company said in a statement.

Novo’s American depositary receipts gained 5.1% at 1:10 p.m. in New York on Friday, while telehealth company Hims & Hers Health Inc. shares dropped 24%.

FDA moves

The FDA’s ruling means compounding pharmacies no longer have permission to make exact copies of Novo’s brand-name drugs as they did during the shortage. However, the agency won’t take immediate action against pharmacies in order “to avoid unnecessary disruption to patient treatment,” according to a statement.

The FDA said compounders will have 60 or 90 days to stop making copies of Novo’s drugs, depending on their type of facility.

Sesame Inc., a telehealth platform that offers compounded weight-loss drugs, assured patients that their medications will still be available for “at least a year” due to the FDA’s grace period, potential legal challenges, and the drugs’ shelf life. The company, which has ties to Marty Makary, President Donald Trump’s pick to lead the FDA, also said it’s working with manufacturers to secure deeper discounts on the medications in late 2025 and into 2026.

“Rest assured, your compounded GLP-1 medication will remain available, and there will be no disruptions in your care,” Sesame said in an email to patients shared with Bloomberg.

Compounders can still make alternative versions of the drugs if they modify doses, add other ingredients, or change the route of administration in compliance with FDA rules. Hims CEO Andrew Dudum has said that compounded versions of obesity drugs will be available “indefinitely” through the company under this provision.

“Now that the FDA has determined the drug shortage for semaglutide has been resolved, we will continue to offer access to personalized treatments as allowed by law to meet patient needs,” Dudum said in a post on X. “We’re also closely monitoring potential future shortages.”

On Friday morning, prior to the FDA’s announcement, Hims said it had purchased a new manufacturing facility that will allow it to make copies of Novo’s drugs from start to finish.

“It is now critical to understand Hims’ legal pathway to selling personalized doses since it has to be the primary mechanism to sell semaglutide going forward,” Leerink Partners analyst Michael Cherny said in a note.

Barclays analysts led by Emily Field wrote in a note that the FDA announcement should eventually lead to other pharmacies “no longer producing compounded versions of the medication.”

Billion-dollar industry

Hundreds of thousands of Americans have come to rely on compounded versions of the drugs since 2022, bringing in as much as $1 billion a year for their makers, bankers estimate. The copycat drugs are widely available through telehealth companies like Hims for a fraction of the price of brand-name drugs, making them a more affordable option for many people.

The downside is that they don’t go through the same rigorous safety and quality checks as brand-name or generic drugs. Some state regulators have joined Novo and Lilly in raising safety concerns regarding some compounded versions. Using lawsuits and public warnings, the drugmakers have waged a campaign to discourage use of the compounded products. Both companies have asked the FDA to ban compounding of their drugs, saying that the substances are too complicated to make using those methods.

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“No one should have to compromise their health due to misinformation and reach for fake or illegitimate knockoff drugs,” Dave Moore, Novo’s executive vice president of U.S. operations and global business development, said in a statement.

Compounders say that they follow state and federal regulations, sourcing their raw materials from FDA-registered companies. When the FDA declared the end of a shortage of Lilly’s drugs in October, compounders sued, saying that the drugs were still in short supply.

Earlier this week, Novo and Lilly asked a federal court to reject legal protections to drug compounders making copycat versions of Lilly’s Zepbound (tirzepatide).

—With assistance from Bill Haubert and Brandon Harden

For more on weight management:

• Ozempic, Wegovy maker calls out Hims & Hers Super Bowl ad: ‘Check before you inject’
• Hims & Hers Super Bowl ad slams pricey pharma industry—and fumbles FDA warnings on compounded GLP-1 drugs
• Exclusive: The COO of Hims & Hers was the third person to try its new weight-loss drugs—and she’s ready to share her story
• Online searches predicted the surge in prescriptions of weight-loss drugs like Wegovy and Zepbound, study says. Here’s what could happen next
• Zepbound vs. Wegovy: New clinical trial says this weight-loss medication sheds more pounds