The U.S. Federal Trade Commission sued Hims & Hers on Wednesday alleging the telehealth platform shared users’ health data with online advertisers, despite promising privacy, and engaged in deceptive billing and cancellation practices.
Users’ sensitive health information was shared with online advertising companies including Meta Platforms and Snap despite the company leading customers to believe their data was private, the FTC alleged in the lawsuit filed along with Los Angeles County and Utah.
Hims & Hers stock added to losses after the news and was trading down around 12%.
Hims & Hers is one of the largest telehealth players in the market for weight loss drugs. The company offers telehealth appointments and prescriptions for erectile dysfunction, hair loss, and mental health medications, which it ships straight to customers.
“The FTC will not hesitate to act on behalf of consumers deprived of their ability to choose which products they want and whether to keep their most sensitive health information private,” Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, said in a statement.
Hims & Hers called the claims baseless in a post on social media site X. “This is not enforcement grounded in consumer protection; it is an effort to generate headlines at our expense,” the company said in the post.
Hims & Hers also started charging users for prescriptions before they have had a chance to meet with healthcare providers, the FTC alleged.
Most customers do not receive a consultation with a provider, and instead are charged for prescriptions soon after filling out an intake form, according to the agency.
Hims & Hers also makes it difficult to cancel subscriptions, the FTC said.