The details I can remember: Humans are naturally asexual, only women. Penises are alien parasites attached at birth as part of a huge conspiracy. A group of women know the truth and are trying to fight back. I believe the story ends with a woman giving birth to a daughter without having had sex.
This is Manikins, by John Varley, according to the OP.
"No, no." She laughed, without humor. "There's no such thing as a man, the way you're thinking about it. Only women who've been taken over at birth by these, these..." she groped in the air for a word hideous enough to express her distaste. She couldn't find it. "Things. Organisms. I said they invaded the Earth, but I'm not sure. They might be from here. There's no way to know, they've taken over too completely."