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Eli Lilly sues telehealth sites selling copycat Zepbound

The lawsuits target platforms selling compounded versions of name-brand weight-loss drugs even after the government declared a shortage of them was over.

J. Edward Moreno

Eli Lilly sued four telehealth platforms selling copycat versions of its blockbuster weight-loss drug Zepbound, a move that could foreshadow more legal actions against these kinds of companies.

In four separate lawsuits filed Wednesday, Lilly accused Mochi Health, Fella Health, Willow Health, and Henry Meds of continuing to sell knockoff Zepbound even after tirzepatide, the active ingredient in the drug, was taken off the Food and Drug Administration’s shortage list in December.

During a shortage, compounding pharmacies are able to sell exact copies of drugs to fill in gaps in supply. Outside of a shortage, compounding pharmacies can only make adjusted versions of patented drugs, such as a dose that the drugmaker doesn’t make or a version that removes ingredients the patient is allergic too.

Lilly says the telehealth platforms are taking advantage of that loophole to mass produce slightly adjusted versions of their drugs and telling patients they’re “personalized” or “tailored” for them. Mochi, Fella, Willow, and Henry did not immediately respond to requests for comment.

Notably absent from the suits is OrderlyMeds, which recently responded to a cease and desist letter from Lilly by saying meant "nothing."

The lawsuits could be a bad sign for Hims & Hers, which does not sell compounded versions of Lilly’s drugs but does sell semaglutide, the active ingredient in Novo Nordisk’s Ozempic and Wegovy.

Similar to the pharmacies sued by Lilly, Hims offers its users “personalized” versions of semaglutide. That ingredient was taken off the FDA’s shortage list in February, and the off-ramp for outsourcing pharmacies like those that Hims works with ends on May 22.

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SpaceX gets a wave of bullish ratings from Wall Street analysts

SpaceX received more than a dozen positive analyst calls on Tuesday — including from major Wall Street banks — as they initiate coverage on Elon Musk’s space and AI company.

SpaceX went public on June 12 at a $2.2 trillion valuation, the largest debut in history. While the company hasn’t yet posted a profit, it seems to have convinced Wall Street that it will get there and grow its valuation on the way.

Of the at least 17 analysts that gave a rating on Tuesday, all but one gave it a “buy” or “outperform” rating. MoffettNathanson was "neutral."

The ratings come as SpaceX joined the Nasdaq 100 index, a benchmark tech-heavy basket of companies that underpins millions of portfolios. The inclusion adds built-in demand for the stock from index funds and ETFs.

Still, SpaceX fell more than 5% on Tuesday amid a broader sell-off, and is currently effectively flat from its opening price of $150 a share.

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Nike sinks to lowest level since 2014 after warning of “challenged” sales environment in Q4 report

Did Nike do it?

Investors had a mixed reaction after the global sports apparel company reported its fourth quarter earnings on Tuesday after the bell. Shares initially rose 5% as Nike beat out Wall Street expectations amid a hefty tariff refund bonus. However, the stock then sank to its lowest level since August 2014 in postmarket trading.

Here are the Q4 numbers:

  • Revenue of $11.0 billion (estimate: $10.8 billion).

  • Adjusted earnings per share of $0.20 (estimate: $0.12).

Ahead of this report, Nike warned that results would be flattered by a one-time tariff refund (now estimated at roughly $0.52 per share for the bottom line). That gave the company an extra cushion in snapping its streak of seven quarters of year-over-year profit declines.

Over the past year, the company had been punished by tariffs on imported goods, stagnant consumer spending, and increasing competition from other footwear brands like New Balance, Adidas, and Hoka.

Outgoing CFO Matthew Friend deemed it an “increasingly challenging operating environment, where sell-through remains challenged.”

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