FTC sues Hims & Hers over data and billing practices

What happened: On July 29, the Federal Trade Commission (FTC), along with Utah and Los Angeles County, sued telehealth company Hims & Hers. The lawsuit alleges that Hims & Hers shared users' sensitive health information with third-party advertising platforms, charged customers before they consulted a medical provider, and made subscription cancellations difficult. The FTC's complaint details that Hims & Hers promised users their data would remain private but failed to uphold this promise.

Market impact: The news drove Hims & Hers' stock down by 10% on Wednesday. This lawsuit could have broader implications for the telehealth industry, as it highlights regulatory scrutiny over data privacy and billing practices. Investors may reassess their positions in other telehealth companies, such as Teladoc and Amwell, due to potential regulatory risks.

What to watch next: First, investors should monitor Hims & Hers' response to the lawsuit and any potential settlement discussions. Second, watch for any further regulatory actions or guidance from the FTC regarding data privacy and billing practices in the telehealth sector. Lastly, upcoming earnings reports from other major telehealth companies could provide insight into how this narrative is affecting their businesses.