Hims & Hers sees explosive growth with plans to launch generic GLP-1 drug
Business is booming for online health and wellness company Hims & Hers, which raised its 2024 outlook buoyed by a strong third quarter.
The company's revenue jumped 77% in the third quarter to reach $401.6 million alongside a net income of $75.6 million. It now has 2 million subscribers on its platform, up 44% year over year. Adjusted EBITDA was $51.1 million for the third quarter of 2024 compared to $12.3 million for the third quarter of 2023.
Hims & Hers is a multispecialty telehealth platform that connects consumers to medical care for numerous conditions related to mental health, sexual health, dermatology and primary care. The company expanded into heart health in August and weight management at the start of the year. The company has increasingly focused on offering personalized treatments to consumers by leveraging technology and data.
CEO Andrew Dudum told investors north of 50% of subscribers are now utilizing a personalized solution.
Hims & Hers upped its 2024 revenue forecast to a range of $1.46 billion to $1.465 billion and adjusted EBITDA guidance to a range of $173 million to $178 million.
Hims & Hers launched a virtual weight management program last December, adding injectable weight loss drugs in May, and that investment is quickly paying off.
The company offers oral weight loss medications starting at $79 per month and $199 per month for compounded GLP-1 injections. Pricing includes unlimited medical consultations with a licensed provider.
The company now plans to bring the generic version of Novo Nordisk's diabetes drug, liraglutide, to its platform in 2025.
"We have already confirmed a core supplier for this addition, and over the next few months expect to finish completing test and batch validation, as well as confirming certificates of authenticity. Our technology platform enables us to support consumers in identifying their options and help providers match their patients with the most appropriate solution for an individual's personal clinical need," Dudum told investors during the company's third-quarter earnings call Nov. 4.
Shares of Hims climbed 5% after it announced earnings and the launch of the generic GLP-1. The company's shares are up 27% in the past five days.
The GLP-1 drug market has been dominated by pharmaceutical giant Novo Nordisk and has faced supply constraints in recent months as the drugs get expanded approval from regulators and increased health coverage.
When a drug is in shortage, compounders may be able to prepare a compounded version of that drug if they meet certain requirements of the Food and Drug Administration (FDA), the agency said in a January release. But, Eli Lilly's and Novo Nordisk's weight loss drugs are coming off the FDA's shortage lists.
Hims & Hers executives said the supply constraints were not abating.
"While the regulatory landscape continues to evolve, the data we are seeing on our platform suggests widespread difficulty accessing name-brand GLP-1 solutions," Dudum said. "Over the last two months, a total of over 80,000 reports have come through our platform from consumers that have been unable to obtain name-brand GLP-1 treatments and we are seeing the number of consumers voicing their frustration increase, not decrease in recent weeks."
He added, "Our belief is that the principles that have unlocked success in other specialties provide a path for weight loss to continue to succeed when the shortage is ultimately resolved.
Doximity ups 2024 guidance, buoyed by strong quarter
Doximity, an online platform for medical professionals, provided better-than-expected projections for the third quarter and raised its full-year outlook.
Wall Street is betting big on the health tech company as its stock soared 35% higher on Friday afternoon, according to data provided by S&P Global Market Intelligence, after the company reported second-quarter earnings.
Doximity brought in revenue of $136.8 million in its fiscal second quarter, versus $113.6 million a year ago, an increase of 20% year over year. It reported net income of $44.2 million versus $30.6 million in the same quarter a year ago. Adjusted earnings of 30 cents per share also exceeded forecasts of 26 cents per share.
The company’s top and bottom line results topped Wall Street analysts’ expectations.
For the first half of Doximity’s fiscal year, revenue is up 17% from a year ago and net income is up 36% from the first half of 2023.
For its fiscal third quarter, Doximity now expects revenue between $152 million and $153 million and adjusted EBITDA between $83 million and $84 million.
It upped its guidance for 2024 and now expects revenue between $535 million and $540 million and adjusted EBITDA between $274 million and $279 million.
The company's network members include more than 80% of U.S. physicians across all specialties and practice areas. Doximity offers personalized news feeds for its 2 million members.
The company provides software tools for doctors and clinicians and its clinical workflow tools saw record use in the second quarter with more than 600,000 unique active prescribers, according to Jeff Tangney, co-founder and CEO of Doximity.
The company’s workflow tools include telehealth, fax, scheduling and AI assistants.
“Our AI tools grew the fastest with over 1 million Doximity GPT prompts in Q2. But our telehealth tools grew nicely as well. In this age of increasing burnout, we're proud to help doctors save time, be more mobile and provide the best care for their patients,” Tangney told investors.
“While we're still in the early innings of monetizing these workflow tools, our point-of-care and formulary products continue to gain traction. Indeed, 20% of our pharma sales in Q2 came from our workflow-related modules. As health care shifts to be more digital, more mobile and more AI-powered, we're proud to be leading the way,” Tangney said.
Doximity’s growth in the quarter was led by its top 20 clients. “These clients are the largest, most sophisticated pharma companies who employ entire teams of analysts to measure their marketing effectiveness. We believe our continued growth with them is proof of our value to the broader marketplace,” Tangney said.
Waystar beats the Street with strong Q3, raises outlook
Healthcare payment software company outperformed analysts' expectations in the third quarter with strong revenue growth and profitability, marking the company's second earnings report as a public company.
The company brought in $240 million in third-quarter revenue, up 22% from the same period a year ago. That beat Wall Street estimates of $223.8 million for the quarter. Subscription revenue was up 16% year over year to $118 million, while volume-based sales grew 28% year over year to $120.7 million, according to its third-quarter earnings report.
Waystar reported net income of $5.4 million and GAAP net income per share of 3 cents. It also reported non-GAAP net income of $25.3 million and non-GAAP net income per diluted share of 14 cents. Waystar's bottom results also beat Wall Street estimates.
Waystar also logged adjusted EBITDA of $96.7 million, up 40% year over year.
The company offers healthcare payment and revenue cycle management tools, serving more than 30,000 customers representing approximately 1 million distinct providers. Waystar facilitated more than $5 billion in healthcare payment transactions last year.
Waystar handled more than $1.2 trillion in gross claims volume in 2023, spanning about 50% of the U.S. patient population. It went public in June, raising $967.5 million, and marking the biggest health tech IPO since 2022. The company has an enterprise value of about $5 billion.
"As providers prioritize ways to get paid faster and more efficiently, we are investing in AI-driven automation across our cloud-based software platform to drive tangible client return on investment," Waystar CEO Matt Hawkins said.
Hawkins said Waystar offers a modern, cloud-based software platform that delivers tangible return on investment and is "cyber secure." "We create enduring, long-lasting relationships with clients. When you look at our retention, our 'stickiness', so to speak, we have strong retention, we have a net revenue retention rate of 109," he told Fierce Healthcare in an interview.
Waystar also works with a diverse range of providers across care settings, from the largest hospitals and health systems to those practicing in ambulatory and smaller care settings, Hawkins noted. "The diversity of our mix of clients leads to a resilient business that basically isn't overly exposed," he said.
The company is benefiting from more rapid new-client implementations related to the Change Healthcare cyberattack. When Change, its competitor, was hit with a cyberattack in February, which forced it to disconnect its systems, Waystar stepped up to offer a temporary program to allow providers expedited access to revenue cycle management software to resume cashflow.
Hawkins said Waystar helped 30,000 providers quickly move to the Waystar platform, in an average of three days. The company sees opportunities to expand its business with those customers.
"That was initially an urgent phase. Providers that joined us in that phase one are now already starting to think through, what additional software on the Waystar software platform can we utilize? We're having really productive conversations there. That's bolstered our sales pipeline. Also, at the street level, there still does seem to be quite a bit of agitation and frustration among some providers have been using the impacted clearinghouses that just hasn't been fully restored, and so we're actively engaging in those conversations," he said.
Ryan Daniels, an analyst with William Blair, wrote in a research note that Waystar's quarterly results and business pipeline point to continued momentum for its platform. "The organization benefits from strong demand for modern revenue cycle management (RCM) software solutions and strong patient payment volumes," Daniels wrote.
In May, Waystar announced it was working with Google Cloud to use generative AI technology for revenue cycle capabilities.
"We're encouraged about the what we've shared with regards to our generative AI product roadmap. We're not taking the pie in the sky approach. Rather, we're taking a use case by use case approach," Hawkins told Fierce Healthcare. "As we evaluated all the different generative AI vendors, we were really delighted with Google Cloud's large language model that's specific to medical terminology, and you couple that with Waystar's extensive data base and data set, and we believe that the use cases that we're working on can bring automation and operational improvement and tangible return on investment to the clients that we serve."
The company was formed in 2017 by the merger of revenue cycle management companies Navicure and ZirMed. Renamed Waystar in February 2018, the company's technology helps manage claims submissions, payer remittances and prior authorizations.
Waystar upped its 2024 outlook and now expects total revenue to range between $926 million and $934 million, compared to prior guidance of $902 million to $918 million. Adjusted EBITDA are targeted at $374 million and $378 million and adjusted EPS are expected to range between 30 cents and 32 cents per share.
The company also set preliminary 2025 revenue guidance at approaching $1 billion.
"Overall, we believe the organization’s unique combination of an experienced management team, a proprietary technology platform, a client-first focus and a provider-centric operating model, positions the company well for strong near-term growth and profitability," Daniels with William Blair wrote.