Bezos Becomes A Drug Lord

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Waiting to pick up a prescription at the pharmacy can be dangerous…half an hour wandering around CVS can lead to any number of unnecessary purchases.

Amazon is launching a new drug delivery service called Amazon Pharmacy to help people get their medication without the wait and without leaving home.


In 2018, Amazon bought pharmaceutical delivery startup PillPack for just under $1 billion.

PillPack’s healthcare industry relationships and fulfilment centers have laid the foundation for Amazon Pharmacy.

How It Works: After creating a “secure pharmacy profile,” customers in 45 states (more to come) can perform a slew of maneuvers directly on Amazon’s main retail site:

  • Shoppers can add insurance info, manage prescriptions, and even speak to a pharmacist online or over the phone. The service accepts “most” insurance plans and also caters to the uninsured.
  • Amazon Pharmacy offers generic and brand-name drugs, but won’t sell high-risk items such as opioids.

As usual, there are bonus perks for Prime members including the service’s ubiquitous free two-day delivery.

Members without insurance also get up to 80% discounts on generic and 40% discounts on brand name medicine.


Have you been to a Borders bookstores lately?

Rival drug stores felt the pain yesterday as investors grew concerned Amazon would disintermediate brick-and-mortar pharmacies and pressure margins. CVS shares dropped 8.6%, Walgreens was down nearly 10%, and Rite Aid tumbled 16%.

But some industry executives downplayed concerns. Rite Aid’s chief operating officer told the WSJ, “Pharmacy is not just a shopping transaction,” citing his companies’ role in providing annual vaccinations.

The Takeaway

Mail-order prescriptions accounted for just 5.8% of the prescription drug market last year. Plenty of white space for Bezos.