What changed in this filing

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Item 1. Business

2024-02-26 compared with 2023-02-27 · 47 added, 51 removed, 232 unchanged (30% of the section changed)

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The Hims & Hers platform includes access to a highly-qualified and technologically-capable provider network, a clinically-focused electronic medical record system, digital prescriptions, and cloud pharmacy fulfillment.

Our digital platform enables access to treatments for a broad range of conditions, including those related to sexual health, hair loss, dermatology, mental health and primary care.

Our digital platform enables access to treatments for a broad range of conditions, including those related to sexual health, hair loss, dermatology, mental health, and weight loss.

Hims & Hers connects patients to licensed healthcare professionals who can prescribe medications when appropriate.

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Through the Hims & Hers mobile apps, consumers can access a range of educational programs, wellness content, community support, and other services that promote lifelong health and wellness.

Since our founding, we have facilitated more than ten million telehealth consultations, enabling greater access to high-quality, convenient, and affordable care for people in all 50 states and the United Kingdom.

Since our founding, we have facilitated nearly twenty million telehealth consultations, enabling greater access to high-quality, convenient, and affordable care for people in all 50 states and the United Kingdom.

Hims & Hers products can also be found in tens of thousands of top retail locations in the United States.

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Business Strategy

We are a consumer-first health and wellness platform focused on providing modern personalized health and wellness experiences to consumers.

We are a consumer-first health and wellness platform focused on providing modern personalized health and wellness solutions to consumers.

We offer access to a range of health and wellness products and services available for customers to purchase through our websites and mobile applications.

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We also offer over-the-counter drug and device products and cosmetics and supplement products, which are primarily focused on general wellness, skincare, sexual health and wellness, and hair care.

These curated non-prescription products include melatonin, biotin, probiotics and collagen protein supplements in the wellness category, moisturizer, creams, sunscreen, serum, face oil and face wash in the skincare category, condoms, climax delay spray and wipes, vibrators and lubricants in the sexual health and wellness category, and shampoos, conditioners, scalp scrubs and topical treatments such as minoxidil in the hair care category.

These curated non-prescription products include melatonin, and biotin in the wellness specialty, moisturizer, creams, sunscreen, serum, face oil, and face wash in the skincare specialty, condoms, climax delay spray and wipes, vibrators, and lubricants in the sexual health and wellness specialty, and shampoos, conditioners, scalp scrubs, and topical treatments such as minoxidil in the hair care specialty.

We also offer many of these over-the-counter products through retail partnerships, in stores and online.

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In all cases, the manufacturer is responsible for obtaining and maintaining authorization from the U.S.

Food and Drug Administration (“FDA”), if required, and complying with current Good Manufacturing Processes (cGMP) as adopted

and enforced by the FDA.

In addition, the internal Hims & Hers Quality team is responsible for maintaining policies and procedures to ensure non-prescription products comply with quality standards, which include independent laboratory testing of products, supplier and quality and compliance assessments.

Food and Drug Administration (“FDA”), if required, and complying with current Good Manufacturing Processes (cGMP) as adopted and enforced by the FDA.

In addition, the internal

Hims & Hers Quality team is responsible for maintaining policies and procedures to ensure non-prescription products comply with quality standards, which include independent laboratory testing of products, supplier and quality and compliance assessments.

Most of the offerings on our websites and mobile applications are sold to customers on a subscription basis.

Subscription plans provide an easy and convenient way for customers to get the ongoing treatment they need while simultaneously providing the Company with predictability through a recurring revenue stream.

For subscription plans, customers select a desired cadence to receive products, which can range from every month to every two to twelve months, depending on the product.

For subscription plans, customers select a desired cadence to receive products, which can range from every 30 days to every 60 to 360 days, depending on the product.

The customer is billed on a recurring basis based on the selected cadence and a specified quantity of product is shipped at each billing.

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As we implement our product roadmap, we expect to grow revenue through additional subscription-based recurring revenue offerings.

The recent launches of new prescription products in sexual health and dermatology, and launches of hair care and supplement retail products, demonstrate the scalability of the platform.

The recent launches of new prescription products in weight loss, sexual health, and dermatology, and launches of hair care and supplement retail products, demonstrate the scalability of the platform.

Growth Opportunities

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Customers serve as ambassadors for the Hims & Hers brand, further driving organic growth through word of mouth and user-generated content.

More than 80% of our first time customers to date indicate that they came to Hims & Hers to learn about and find options for their condition and are seeking treatment for their particular conditions for the first time.

The large majority of our first time customers to date indicate that they came to Hims & Hers to learn about and find options for their condition and are seeking treatment for their particular conditions for the first time.

The convenience of our websites and mobile application allows us to reduce stigma and access-related barriers that frequently prevent consumers from seeking medical care, expanding the Company’s market opportunity.

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In addition, our brand positioning has afforded significant partnerships with leading talent whose promotional efforts drive meaningful awareness of the products and services we make available.

As our portfolio of products and services grows across categories, we believe that our market presence and brand recognition will expand, driving more consumers to seek out Hims & Hers for future healthcare needs.

As our portfolio of products and services grows across specialties, we believe that our market presence and brand recognition will expand, driving more consumers to seek out Hims & Hers for future healthcare needs.

Grow within existing customer base

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Through more robust customer engagement, we have the ability to deliver longer term subscription adoption and drive more cross sell opportunities.

Category expansion into new conditions

We are pursuing a roadmap of rapid category expansion into new conditions that can be treated safely via telehealth, require ongoing and recurring customer relationships, and for which generic medication has been established as an effective means of treatment.

Future care opportunities that show high prevalence within our existing customer base and offer traits similar to our existing categories in terms of business model characteristics include testosterone treatment, menopause, sleep disorders, post-

traumatic stress disorder, weight management, fertility, diabetes, cholesterol, and hypertension, which represent significant opportunities.

Specialty expansion into new conditions

We are pursuing a roadmap of rapid specialty expansion into new conditions that can be treated safely and effectively via telehealth, require ongoing and recurring customer relationships, and for which generic medication has been established as an effective means of treatment.

Future care opportunities that show high prevalence within our existing customer base and offer traits similar to our existing specialties in terms of business model characteristics include testosterone treatment, menopause, sleep disorders, post-traumatic stress disorder, fertility, diabetes, cholesterol, and hypertension, which we believe represent

significant opportunities.

Given the prevalence of these conditions, we see a large market opportunity for our current and future offerings.

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Apostrophe Pharmacy LLC (“Apostrophe Pharmacy,” and together with XeCare, the “Affiliated Pharmacies”), is an additional dedicated licensed mail order pharmacy located in Arizona that provides prescription fulfillment services solely to Hims & Hers customers as part of our acquisition of Apostrophe in 2021.

In 2022, we expanded the Apostrophe Pharmacy facility and opened an approximately 25,000 square foot facility in Phoenix, Arizona.

In 2022, we expanded the Apostrophe Pharmacy facility and opened an approximately 25,000 square foot facility in Gilbert, Arizona.

The Affiliated Pharmacies together enable seamless drug delivery, and drive increased operating leverage across the platform by allowing us to further personalize and consolidate shipping of orders as well as expand capabilities quickly for adjacent and other new conditions.

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The strength of the Hims & Hers brand affords us numerous opportunities to partner with and offer new solutions to help transform existing healthcare stakeholders.

We have relationships with leading health systems including Ochsner Health, Mount Sinai Health System, Privia, Carbon Health, and ChristianaCare Health System to provide a clinically focused, telehealth-enabled patient care collaboration.

We have relationships with leading health systems including Ochsner Health, Mount Sinai Health System, Carbon Health, ChristianaCare Health System, and Hartford Healthcare to provide a clinically focused, telehealth-enabled patient care collaboration.

These relationships offer our customers access to applicable in-person care within these systems to enhance their overall healthcare experience.

These collaborations, which are intended to help Hims & Hers customers obtain in-person care not accessible through the Hims & Hers platform, do not involve any monetary exchange, compensation, or other financial incentives between the parties.

For primary care prescriptions, we also allow customers to seamlessly fulfill their prescription for same day delivery through Capsule and Alto in select markets.

Partner and Affiliated Pharmacies

We have entered into contractual arrangements with three licensed pharmacies (sometimes referred to herein as “Partner Pharmacies”), PostMeds, Inc.

(d/b/a TruePill), EHT Pharmacy LLC (d/b/a Curexa Pharmacy), and ITC Inc.

(d/b/a ITC Compounding Pharmacy) for fulfillment and distribution of certain prescription and non-prescription products available through the Hims & Hers platform.

We maintain contractual arrangements with three licensed pharmacies (sometimes referred to herein as “Partner Pharmacies”), EHT Pharmacy LLC (d/b/a Curexa Pharmacy), ITC Inc.

(d/b/a ITC Compounding Pharmacy), and The London Specialist Pharmacy Limited for fulfillment and distribution of certain prescription and non-prescription products available through the Hims & Hers platform.

We are not bound by any exclusivity or minimum order requirements with respect to our use of each pharmacy, and have the ability to utilize other pharmacies at our discretion.

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We currently accept payments only from our customers—not any third-party payors, such as government healthcare programs or health insurers.

Because of this approach, we are not subject to many of the laws and regulations that impact other participants in healthcare industry.

Because of this approach, we are not subject to many of the laws and regulations that impact other participants in the healthcare industry.

If we begin accepting reimbursement payments from insurance providers or other third-party payors such as a government program, we will become subject to some of these additional healthcare laws and regulations.

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Numerous U.S.

state and federal laws and regulations govern the collection, dissemination, use, privacy, confidentiality, security, availability, integrity, and other processing of health information.

state and federal laws and regulations govern the collection, dissemination, use, privacy, confidentiality, security, availability, integrity, and other processing of health information and other types of personal data or personally identifiable information (“PII”).

We believe that, because of our operating processes, we are not a covered entity or a business associate with respect to our customers or services provided through our platform under the Health Insurance Portability and Accountability Act and the implementing regulations (“HIPAA”), which establishes a set of national privacy and security standards for the protection of protected health information by health plans, healthcare clearinghouses, and certain healthcare providers, referred to as covered entities, and the business associates with whom such covered entities contract for services.

Notwithstanding that we do not believe that the Company meets the definition of a covered entity or business associate under HIPAA with respect to our customers or services provided through our platform, we have executed business associate agreements with certain other parties and have assumed obligations that are based upon HIPAA-related requirements.

Because we need to use and disclose customers’ health and personal information in order to provide our services, we have developed and maintain policies and procedures to protect that information, including administrative, physical and technical safeguards.

However, to the extent we begin accepting payment from third parties or insurance providers, we may become subject to HIPAA in relation to our customers and could face penalties and fines if we fail to comply with applicable requirements of HIPAA and its implementing regulations.

Regardless of whether or not we meet the definition of a covered entity or business associate under HIPAA, we have executed business associate agreements with certain other parties and have assumed obligations that are based upon HIPAA-related requirements.

As our business operations continue to develop, including through the launch of new product offerings or the development of new services, we may collect additional sensitive health and personal information from our customers that could create additional compliance obligations and may increase our exposure to compliance and regulatory risks regarding the protection and dissemination of such information.

In addition to HIPAA, numerous other federal, state, and foreign laws and regulations protect the confidentiality, privacy, availability, integrity and security of health information and other types of personal information, including the California Confidentiality of Medical Information Act.

These laws and regulations are often uncertain, contradictory, and subject to changing or differing interpretations.

Additionally, these laws may be similar to or even more protective than, and may not be preempted by, HIPAA and other federal privacy laws, particularly with respect to highly sensitive personal information involving behavioral health or sexually transmitted disease.

In addition to HIPAA, numerous other federal, state, and foreign laws and regulations protect the confidentiality, privacy, availability, integrity and security of health information and other types of PII, including the California Confidentiality of Medical Information Act, and these laws and regulations are rapidly evolving.

These laws and regulations in many cases are more restrictive than, and may not be preempted by, HIPAA and its implementing rules, particularly with respect to highly sensitive PII involving behavioral health or sexually transmitted diseases.

These laws and regulations are often uncertain, contradictory, and subject to changing or differing interpretations, and we expect new laws, rules and regulations regarding privacy, data protection, and information security to be proposed and enacted in the future.

This complex, dynamic legal landscape regarding privacy, data protection, information security, and artificial intelligence creates significant compliance issues for us, the Affiliated Medical Groups, the Affiliated Pharmacies, and the Providers, and potentially exposes us to additional expense, adverse publicity, and liability.

Additionally, these laws may be similar to or even more protective than, and may not be preempted by, HIPAA and other federal privacy laws, particularly with respect to highly sensitive PII involving behavioral health or sexually transmitted diseases.

The privacy and data protection laws in many states in which we operate are more restrictive than HIPAA and/or may apply more broadly than HIPAA..

For example, the California Consumer Privacy Act of 2018 (“CCPA”) protects the personal information of California consumers regardless of the location of the business holding the information.

The CCPA went into effect on January 1, 2020.

Additionally, the California Privacy Rights Act (“CPRA”), which took effect January 1, 2023, expands upon the rights and requirements implemented through the CCPA.

The CPRA significantly modifies the CCPA, requiring the Company to incur additional costs and expenses and modify certain of our privacy practices.

Virginia has similarly adopted a comprehensive privacy law, the Consumer Data Protection Act, which also took effect January 1, 2023.

Colorado, Connecticut, and Utah have also passed comprehensive privacy laws, each which will take effect either in July or December of 2023.

While these new state privacy laws emulate the CCPA/CPRA in many respects, each has requirements that will require particular assessment for compliance.

For example, the California Consumer Privacy Act (“CCPA”) and the California Privacy Rights Act (“CPRA”) require, among other things, covered companies to provide new disclosures to California consumers and afford such consumers new abilities to opt-out of certain sales of personal information.

Similar legislation has been proposed or adopted in other states.

Aspects of these new and emerging state privacy laws and regulations, as well as their interpretation and enforcement, are dynamic and evolving.

These laws and regulations each require particular assessment for compliance, and we may be required to modify our practices in an effort to comply with them, which may impact demand for our offerings.

Where state laws are more protective than HIPAA or apply more broadly than HIPAA, we must comply with the state laws to which we are subject.

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The GDPR became effective in the European Union (“EU”) on May 25, 2018.

Under the GDPR, data protection authorities have the power to impose significant administrative fines for violations, which may also lead to damages claims by data controllers and data subjects.

The United Kingdom completed its withdrawal from the EU on January 31, 2020 in a process known as “Brexit,” and following the expiry of the Brexit transition period, which ended on December 31, 2020, the UK GDPR has been implemented in the United Kingdom.

Under the GDPR, data protection authorities in the EU have the power to impose significant administrative fines for violations, which may also lead to damages claims by data controllers and data subjects.

The UK GDPR sits alongside the UK Data Protection Act 2018 which implements certain derogations in the GDPR into UK law.

Under the UK GDPR, companies not established in the UK but who process personal data in relation to the offering of goods or services to individuals in the UK, or to monitor their behavior, are subject to the UK GDPR - the requirements of which are (at this time) largely aligned with those under the GDPR and may lead to significant compliance and operational costs.

On October 7, 2022, President Biden executed an Executive Order to implement a new European Union-U.S.

Data Privacy Framework to address European concerns over international data transfers.

If adopted by the EU, such framework is set to take effect in 2023.

Additionally, in July 2023, the European Commission adopted an adequacy decision concluding that the United States ensures an adequate level of protection for personal data transferred from the EEA to the United States under the EU-U.S.

Data Privacy Framework (followed in October 2023 with the adoption of an adequacy

decision in the UK for the UK-United States Data Bridge).

However, the adequacy decision does not foreclose, and is likely to face, future legal challenges.

We are building a trusted brand focused on empowering consumers to feel great by providing modern personalized health and wellness experiences to consumers to address their health and wellness needs.

From our launch, we have used a diverse

marketing strategy to reach our customers.

From our launch, we have used a diverse marketing strategy to reach our customers.

We advertise on digital media, social media, television, radio, out-of-home media, and various other media channels.

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We strive to hire the best and brightest talent across the industry with a focus on individuals determined to improve access to health and wellness solutions for millions.

As of December 31, 2022, our team was comprised of 651 full-time employees across various functions.

As of December 31, 2023, our team was comprised of 1,046 employees across various functions.

We took prompt action to protect our employees’ health in response to the COVID-19 pandemic, including closing our offices in March 2020 and shifting to an official remote-first policy in June 2020.

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We also offer a 401(k) Savings Plan and the ability to participate in our Employee Stock Purchase Plan to all U.S.

In addition, the majority of our employees are eligible for equity awards, depending on

function, to align incentives and provide the opportunity to share in the Company’s financial success.

In addition, the majority of our employees are eligible for equity awards, depending on function, to align incentives and provide the opportunity to share in the Company’s financial success.

Additionally, our paid time off programs enable and encourage our workforce to enjoy personal time away from their job responsibilities.

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Our ability to obtain and maintain intellectual property protection for our proprietary technology platform, preserve the confidentiality of our trade secrets, and operate without violating the intellectual property rights of others is important to our success.

We have a number of measures to protect our intellectual property and brand, including trademarks, confidentiality procedures, non-disclosure agreements, and employee non-disclosure and invention assignment agreements, to establish and protect our proprietary rights.

protect our proprietary rights.

Despite these efforts, there can be no assurance that we will adequately protect our intellectual property.

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Each trademark registration is due for renewal within ten years from the date of its respective registration date and may be renewed in ten year intervals thereafter.

In addition, we have registered domain names for websites that we use in

our business, such as www.forhims.com, www.forhers.com, www.forhims.co.uk and www.apostrophe.com.

We hold no patents at this time.

In addition, we have registered domain names for websites that we use in our business, such as www.hims.com, www.forhers.com, www.forhims.co.uk, and www.apostrophe.com.

We have one pending patent and hold no registered patents at this time.

Additional Information

Our website addresses are www.forhims.com, www.forhers.com, www.forhims.co.uk and www.apostrophe.com.

We make available free of charge at the Investor Relations section of the forhims.com website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we file or furnish such materials with the Securities and Exchange Commission (the “SEC”).

Our website addresses are www.hims.com, www.forhers.com, www.forhims.co.uk and www.apostrophe.com.

We make available free of charge at the Investor Relations section of the hims.com website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we file or furnish such materials with the Securities and Exchange Commission (the “SEC”).

The SEC also maintains a website located at www.sec.gov that contains reports and other information regarding issuers that file electronically with the SEC.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business