FTC sues Hims & Hers over data, billing; shares fall 12%

The FTC's complaint against Hims & Hers marks the latest escalation in a coordinated federal-state crackdown on digital health companies' data-sharing and subscription practices.

The FTC sued Hims & Hers on July 29, alleging the telehealth firm shared health data with Meta and Snap and enrolled customers in subscriptions without consent, sending shares down nearly 12 percent.

"The FTC's complaint lays out a troubling scenario — consumers unknowingly locked into recurring subscriptions and the disclosure to third parties of consumers' most private health information without their consent," Christopher Mufarrige, director of the FTC's Bureau of Consumer Protection, said.

The complaint, filed in the Northern District of California and joined by Utah and Los Angeles County, alleges Hims shared customer lists with advertising platforms and embedded tracking tools including the Meta Pixel that transmitted user activity data. The company also charged consumers for prescriptions almost immediately after they submitted intake forms, despite marketing that promised consultations with medical providers, and made cancellation difficult — before 2023, most customers could cancel only by phone, email, or chat.

The action invokes Section 5 of the FTC Act and the Restore Online Shoppers' Confidence Act, following a nearly three-year investigation. Kessler Topaz Meltzer & Check, a securities litigation firm, announced Aug. 3 it is investigating potential federal securities law violations by Hims on behalf of investors who suffered losses, adding a second legal front.

The complaint details two primary mechanisms for the alleged data sharing. Hims handed over customer lists to Meta and Snap, and its website embedded tracking tools that automatically reported users' actions to advertising platforms. The FTC said this occurred despite Hims' privacy representations, including influencer marketing that emphasized the "discreet" nature of the service. Hims has denied the allegations, saying the FTC "disregards substantial evidence we provided the FTC during its nearly three-year investigation, ignores established state laws and industry standards in telehealth, and contorts the law to try to manufacture claims."

Subscription Billing Under Scrutiny

The FTC also alleges Hims misled hundreds of thousands of consumers by charging them for prescription subscriptions without express informed consent. Most customers never received a consultation with a medical provider before being charged, despite marketing that suggested they would. The company advertised monthly or quarterly refill schedules but processed refill charges approximately 10 days earlier than consumers would reasonably expect, requiring cancellation two days before that early processing date. Consumer complaints cited in the complaint include one user who wrote: "I was told that I would be able to speak with a doctor in a few days and that nothing would be charged to my card that day. Him's & Her's charged me immediately!"

Broader Regulatory Trend

The enforcement action reflects a growing pattern of federal and state regulators targeting digital health companies' use of consumer health data for advertising. The involvement of Utah and Los Angeles County as co-plaintiffs signals coordinated federal-state enforcement in data privacy and consumer protection. For the broader telehealth and subscription-based industries, the case shows the need to align marketing claims with actual data practices and billing flows. The FTC's action follows similar scrutiny of health data sharing across the digital health sector, where companies have faced penalties for using tracking pixels and sharing data with advertising platforms.

The securities investigation by Kessler Topaz adds financial exposure beyond any FTC penalties. Hims & Hers, which relies heavily on GLP-1 weight-loss medications and celebrity brand ambassadors including Kristen Bell and Miley Cyrus, faces potential reputational damage that could affect subscriber growth. The case is in its early stages — a complaint has been filed but no court has made findings of liability. Companies in digital health and subscription-based consumer businesses should review their data-sharing arrangements with advertising platforms and their billing and cancellation flows in light of this enforcement action.

This article is for informational purposes only and does not constitute investment advice.