Hims & Hers on my 'Stinky Six' list is imploding; Eli Lilly vs. Novo Nordisk; Two stories of the miraculous weight-loss drugs; Videos and photos of my trip to Ukraine

1) In my October 29 e-mail naming my "Stinky Six" stocks to avoid, I included telehealth-platform company Hims & Hers Health (HIMS), writing:

The company's growth is driven by aggressively prescribing drugs for weight loss, hair loss, anxiety, depression, etc., after a brief phone consult. Its management and advertising are highly promotional. And at yesterday's close of $47.12, the company has a $10.7 billion market cap, and the stock trades at a nosebleed 81 times this year's earnings.

The stock has completely imploded since then, falling 51% through Friday's close. And that's before declining as much as an additional 29% this morning.

Last week, the company launched a compounded version of Novo Nordisk's (NVO) weight-loss pill Wegovy for roughly one-third the price that Novo charges.

But on Friday, the Food and Drug Administration ("FDA") issued this statement, aimed directly at HIMS, which begins:

Today, the U.S. Food and Drug Administration is announcing its intent to take decisive steps to restrict GLP-1 active pharmaceutical ingredients (APIs) intended for use in non-FDA-approved compounded drugs that are being mass-marketed by companies – including Hims & Hers and other compounding pharmacies – as similar alternatives to FDA-approved drugs. These actions are aimed to safeguard consumers from drugs for which the FDA cannot verify quality, safety, or efficacy. We take seriously any potential violations of the Federal Food, Drug, and Cosmetic Act.

Then the general counsel of the Department of Health and Human Services posted this on X:

No wonder the stock is down today. This is exactly the risk I warned about...

That said, I'm actually considering removing HIMS from my "Stinky Six" (which would make it the "Frightful Five" maybe?) because I don't think this business is going away completely.

At the ValueX conference in Switzerland, I met investment writer Kristof Heyndrikx, who wrote this bullish article on the company last July. Excerpt:

Marketing is a crucial element in building brand loyalty. Apple and Steve Jobs demonstrated this extensively. While it seems simple (just make the marketing good) it's extremely difficult to know exactly how to reach and touch your public so they become devoted evangelists for your product or service. It's still early for Hims & Hers, but I think it may have this rare quality.

I think he makes some good points. So I'll let you know if I decide to take HIMS off my list of stocks to avoid...

2) I remain extremely bullish on weight-loss drugs like Wegovy, but I think Eli Lilly (LLY) makes the best drug in the category – tirzepatide, marketed as Mounjaro and Zepbound.

As such, I believe LLY shares will come out on top, as I've written two dozen times (archive here).

Oliver Müller of European investment firm Accresco gave a presentation arguing that Novo Nordisk is the best way to play it. (You can see it here, shared with permission.)

But I like Novo less because its drug, semaglutide – marketed as Wegovy and Ozempic – is inferior to tirzepatide. Lilly's drug has been shown to result in greater weight loss with fewer side effects.

3) Here's a new use case I hadn't considered for these drugs...

(The following is not medical advice, and you should always consult with a doctor before making changes to your medication dosage.)

Two weeks ago, I visited a dear friend I hadn't seen in a while – he's a healthy 74-year-old. He happened to mention that he was microdosing Zepbound at 2.5 mg. I was shocked because he has always been slender.

I ask him why, and he replied: "Because I want to live as long and healthy a life as possible – and this is a miracle drug. I lost five pounds (from 153 to 148), but that's not the goal, so I'm careful not to lose any more. But my blood pressure has gone from 120/80 to 115/75, and all of my blood work is better. It's a fountain of youth!"

This blew my mind. It means the market for these drugs isn't just obese or overweight people, but pretty much every human on Earth!

4) Separately, I met a guy at the ValueX conference who's 70 pounds overweight and the topic of these drugs came up. I asked him if he'd ever taken them, and he said no. When I asked why, he said he was worried about possible unknown long-term side effects and didn't like the idea of being on them for the rest of his life.

I addressed these concerns by saying they've been around for two decades and tens of millions of people are on them, so the risks are well-known and moderate. And the short- and long-term consequences of obesity are horrific.

Plus, plenty of people take medication they can never come off of. A diabetic takes insulin the rest of their life, and I'm going to take Crestor (to reduce my high LDL cholesterol) the rest of my life. So what?

Then things got really deep, and he confessed: "From the day I was born, I've always been fat. And throughout my entire life, people have shamed me, saying I was fat because I lacked willpower and character. And one thing I don't lack is character!"

I asked, "So by taking the drug, you'll feel like you're cheating. That you should be able to lose the weight you want by having more willpower and self-control?"

"Yes," he replied. "I've lost weight before, but it's always come back."

I told him he's not alone: There's an extremely low success rate for obese people losing a lot of weight and keeping it off.

So we agreed to create a WhatsApp group to support him with me and two of his friends.

This is what I sent to the group this morning – a response to my friends who think they're "cheating" by using Zepbound and similar weight-loss drugs:

The processed food and fast-food companies of the world, for decades, have hired armies of the best scientists to carefully engineer their foods with just the right mix of sugar, salt, and chemicals to trigger addiction in human brains. In short, they've waged uncontrolled, unregulated chemical warfare against humanity.

And it has worked! Look at the obesity rates soaring across the world. It's not a question of willpower or character. Most humans are helpless against this onslaught.

Now, at long last, we can fight back with a miracle medicine that neutralizes their attack and protects us – like the world's best vaccine. Why wouldn't everyone who needs it use it?

And why should affordability be an issue? Obesity kills more Americans every year than COVID in its peak year. When we developed a vaccine for COVID, the government made it immediately free for everyone to save millions of people from sickness and death. Why aren't we doing the same for an even more deadly disease?

5) As you read this, I'm on my way back to Poland after a quick three-day trip to Kyiv, Ukraine. It's my sixth visit here in the past three years.

I try to stay away from anything political in my investing e-mails, and I understand that people have a wide range of opinions about Ukraine. So I'm simply going to report on what I saw...

As you can imagine, the situation is very difficult. It has been the most bitterly cold winter in memory, and the Russians have targeted the heating and electric infrastructure (and have killed plenty of civilians) to try to break the Ukrainians' spirits.

But they are utterly failing, as it only makes Ukrainians more grimly determined to fight for their freedom and never again be dominated by Russia.

Here are four videos I took and posted to YouTube:

• Video 1: I visited a building in Kyiv that was hit by a Shahed drone in November, which killed two people. I then visited a temporary tent shelter, one of many around the country to provide food, warmth, and electricity to citizens.
• Video 2: My friends and I donated funds to buy 33-kilowatt and 50-kilowatt generators that power two large apartment buildings, providing them with heat, electricity, running water, and functioning elevators.
• Video 3: Every day at 9 a.m., Ukraine observes a nationwide moment of silence to honor soldiers, civilians, and children killed in the Russian invasion. This daily ritual pauses life across the country – pedestrians stop, drivers step out of cars, and work ceases. On Saturday, I was in a restaurant in Kyiv having breakfast when it happened.
• Video 4: I made a new friend – a local dog!

I also posted 14 pictures on Facebook here, and here are four of them:

The top photo is from my 18-hour overnight train from Warsaw to Kyiv, where I was relatively comfortable in a four-bed sleeper car. The next photo down is my friend Oles, who has been my driver and guide on past visits, meeting me at the station. He's an elected representative (like a city councilman) of a district in Kyiv, where he has lived most of his life and where his mother still lives.

The bottom left photo is an apartment building he showed me that was hit by a drone (see video 1). We then walked across the street and saw the first generator my friends and I bought, which powers the 384-unit apartment building pictured in the bottom right (see video 2).

I also had the pleasure today of meeting Vitali Klitschko, the mayor of Kyiv for the past dozen years. If you think he looks like a heavyweight boxer, you would be correct. He was elected shortly after ending his professional career, during which he was world champion for various periods over three decades.

Here's a photo of our meeting:

Best regards,

Whitney

P.S. I welcome your feedback – send me an e-mail by clicking here.