Why Hims & Hers moved into lab testing

Hims & Hers is getting into the lab testing business.

The telehealth company announced Nov. 13 plans to launch an offering that lets consumers get a blood test at a local Quest Diagnostics lab and have their results analyzed, as well as receive personalized treatment plans from physicians via the company’s platform.

Paying $199 annually gets a patient one blood test that checks for 50 biomarkers, while $499 gets two annual blood tests for 120 biomarkers.

After the test, consumers then receive treatment plans with things like nutrition and exercise recommendations along with medications, according to a company press release.

Moving away from weight loss. The move into lab testing makes sense strategically, as Hims & Hers needs to pivot away from relying so heavily on GLP-1s, Brian Tanquilut, senior equity research analyst at investment bank Jefferies, told Healthcare Brew.

The GLP-1 market is “changing very, very quickly because of changes that are being imposed through government pressure,” Tanquilut said. “That’s put a lot of pressure on Hims’s stock and their performance.”

President Trump announced in early November deals with Novo Nordisk and Eli Lilly to lower out-of-pocket prices for GLP-1s.

A partnership between Novo and Hims fell apart in June after just two months, as Novo said the telehealth company “failed to adhere to the law” by continuing to sell compounded versions of Novo’s Ozempic. However, the two companies are once again in talks for Hims to sell Novo’s Wegovy injection and a forthcoming oral GLP-1 (when approved) on its platform, the telehealth company said in its Q3 earnings.

Hims & Hers stock fell nearly 23% from Oct. 24 to Nov. 24.

Breaking down the biomarkers. Hims & Hers said in the release its lab business will test for biomarkers in areas including heart health, metabolism, hormones, inflammation, and stress. Tanquilut said the company likely chose these areas because they represent common health problems that can be solved with medications like statins, supplements, or vitamins.

“The idea is that once you get a lab test, it gives you a fairly holistic view on your health that includes multiple biomarkers, and from there, they can design combo drugs that are very personalized to what your body needs,” he said. “That’s the whole goal for Hims.”

Hims & Hers also said in its press release that it plans to eventually expand the lab business to offer at-home tests and more biomarkers in areas like bone and brain health as well as detecting chronic illnesses.

Expected earnings. In terms of how the lab business will impact Hims’s overall earnings, Tanquilut said he would expect advertising spend to increase somewhat, but since the testing will be done by Quest, the company won’t have to spend money on building out infrastructure.

Healthcare Brew reached out to Hims & Hers for comment on how the company expects the lab testing business to affect its earnings but did not hear back by publication.

The Wall Street Journal reported that Hims & Hers CEO Andrew Dudum projects the lab business will someday be worth $1 billion.

According to Tanquilut, that goal is possible. At $500 per test, Hims & Hers would have to sell about 2 million tests to hit $1 billion. As of June 30, the company had 2.4 million subscribers, according to its website.

However, not everyone can afford that price point, Tanquilut said.

“I think that, over time, that pricing probably has to come down,” he said.

Plus, Hims & Hers is not the only company offering lab testing, Tanquilut added. Membership to Function Health, a health tech founded in 2022 that offers similar lab testing, costs $365 per year.

Function announced Nov. 19 that it had raised $298 million in Series B funding with a valuation of $2.5 billion.