Amazon has announced the US launch of its prescription drug service, Amazon Pharmacy, a major incursion into a $300 billion sector dominated by giants like CVS, Walgreens, and RiteAid, all of which have seen their share price dip by as much as 16% on the news.
Amazon is using PillPack, the company it acquired in 2018 for nearly $1 billion as its Trojan Horse; and has appointed its founder, TJ Parker, as pharmacy VP. But PillPack will continue to operate a service for mainly older users who require combinations of medications, which are sent in monthly packages with pills grouped in characteristic white envelopes that the user opens each day, a method that improves adherence to treatment and reduces errors.
The idea behind Amazon Pharmacy is to make the purchase and refilling of prescription drugs — with the exception of Schedule II pharmaceuticals: primarily opiates, stimulants, antidepressants or hallucinogens — as simple as purchasing any other product, including the usual advantages of Amazon Prime for shipping and discounts negotiated by Amazon with drug suppliers, of up to 80% in the case of generic drugs and 40% in the case of brand name medications, prompting some analysts to estimate that the purchase of many products could even be cheaper at Amazon than through the user’s health insurance.
In addition, the company will have to break its characteristic integral architecture of data capture from its users: their information will not be shared, so as to comply with the Health Insurance Portability and Accountability Act (HIPAA). The company has also integrated the vast majority of health insurance providers in order to receive both the prescriptions and the discounts that each user has established, has created a 24/7 service with pharmaceutical professionals who will answer questions and consultations, and claims to have the infrastructure to validate each prescription and eliminate possible fraud.
Link to the rest at Forbes
PG says that, while everyone else is sheltering in place, Amazon keeps on disrupting.