GLP-1 Alternatives: 2 Stocks Benefiting From Weight Loss Trends

Key Points

• GLP-1 agonists help increase insulin release, decrease blood sugar levels, and reduce appetite.
• The FDA has taken tirzepatide off the drug shortage list, which now requires compounders to stop producing the compounded GLP-1 version by February 18, 2025, and distributors to cease by March 19, 2025.
• Semaglutide is still on the drug shortage list, which enables labs to continue producing this version of compounded GLP-1.

The supply shortage and high costs of GLP-1 weight loss drugs have created an opportunity for compounded GLP-1 treatments to hit the market and disrupt the medical sector. These treatments are permitted when drugs are listed on the FDA’s list of drug shortages. These shortages can occur for many reasons, including manufacturing and quality disruptions, discontinuation, and delays. The FDA has permitted compounded GLP-1 products, which are not to be confused with generics, to be produced to meet the heavy market demand while branded GLP-1 drugs from Novo Nordisk A/S NYSE: NVO and Eli Lilly & Co. NYSE: LLY remain in short supply. Here are two alternative stocks riding the GLP-1 weight loss trend.

Hims & Hers: Compounded Semaglutide for 80% Less   

Telehealth company Hims & Hers Health Inc. NYSE: HIMS was already a thriving platform discretely selling doctor-prescribed sexual health treatment along with prescription hair loss and mental health treatments.

However, the company supercharged its top and bottom line with the addition of compounded semaglutide GLP-1 injections that start at $99 the first month and go up to $199 afterward.

Compounded GLP-1 treatments still require a prescription, which Hims has licensed providers ready for consultations.

GLP-1 Compounds Super Charged Q3 Metrics

Hims reported a Q3 2024 EPS of 32 cents, beating analyst estimates by 25 cents. Revenues soared 77% year-over-year (YoY) to $410.6 million. Adjusted EBITDA surged 317% YoY. Net Income was $75.6 million, up from a loss of $7.6 million in the year-ago period. Operating cash flow surged 312% YoY to $79.4 million. Subscribers grew 44% YoY to 2 million. Monthly online revenue per average subscriber (RPAS) rose 24% to $67.

Battle for Compounded Tirzepatide Comes to an End

Hims was embroiled in a back-and-forth with the FDA and Eli Lilly over whether tirzepatide was still in short supply. Lilly insisted there was no more shortage, and the FDA eventually agreed. As of December 19, 2024, the FDA has declared that tirzepatide is no longer on the shortage list. Compounding pharmacies have to cease making or selling compounded tirzepatide by February 18, 2025, and outsourcing facilities have until March 19, 2025. Semaglutide is still on the shortage list, and these are compounded versions of Ozempic and Wegovy.

Hims & Hers Plans to Bring Generic GLP-1 to Market in 2025

Hims & Hers CEO Andrew Dudum insisted that over 80,000 reports had come through its platform from consumers unable to obtain name-brand GLP-1 treatments. Dudum has plans to bring liraglutide to the platform in 2025, “Next, we plan to bring liraglutide, the first generic GLP-1 in the market, to the 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.”

LifeVantage: Supplements to Naturally Increase GLP-1 Production  

With the controversy between compounded GLP-1s and name-brand GLP-1s, LifeVantage Co. NASDAQ: LFVN takes the non-FDA route and markets its “MindBody GLP-1 System” which is a dietary supplement system they claim helps to increase the body’s natural production of the GLP-1 hormone. Its U.S. MindBody clinical results show it increased GLP-1 production by 140%, increased activation of GLP-1 receptors by 53%, and reduced the activity of enzymes that break down GLP-1 by 38%.

Is LifeVantage a Pyramid Scheme?

LifeVantage operates as a network marketing company. There have been claims and allegations that its business model is a multilevel marketing (MLM) scheme. While there have been multiple class action lawsuits, LifeVantage has not been legally found guilty of operating a pyramid scheme. In 2017, the FDA issued a warning letter to LifeVantage for making unsubstantiated claims about the ability of its products to cure diseases.

MindBody GLP-1 System Is the Growth Driver

LifeVantage reported fiscal Q1 2025 EPS of 22 cents, beating consensus estimates by 9 cents. Revenues rose 31.26% to $67.76 million, beating estimates by $356.67K. Revenue in the Americas rose 46.3% YoY, while Asia Pacific and Europe revenues fell 15.5% YoY. Enrollments grew by 25% YoY, increasing by 25,000 active accounts in the Americas region.

LifeVantage issued upside FQ2 2025 revenue guidance of $ 67.5 million versus $51.45 million consensus estimates. Fiscal full-year 2025 revenue is expected to be between $235 million and $245 million versus the consensus estimate of $204.3 million.

LifeVantage CEO Steve Fife stated, “The success of our patent-pending MindBody GLP-1 System since its October launch in the U.S. has been remarkable. While our initial inventory sold out in just 13 days, we continued to take orders throughout the quarter. I'm pleased to report that by mid-December, we had received additional inventory and cleared our backlog by the end of December.” The international rollout of its MindBody GLP-1 system will begin in March 2025.