Date
21 October 2018
Amazon’s huge customer base and existing shipping infrastructure could allow Pillpack to scale up quickly. Photo: Reuters
Amazon’s huge customer base and existing shipping infrastructure could allow Pillpack to scale up quickly. Photo: Reuters

Amazon to buy online pharmacy PillPack

Amazon.com announced Thursday that it is buying online pharmacy PillPack, a deal which could set the stage for the e-commerce giant to compete directly with drugstore chains, drug distributors and pharmacy benefit managers.

The deal’s potential to disrupt major players across the drug supply chain nationwide prompted a sell-off in shares of possible rivals, while sending Amazon shares up 2.5 percent, Reuters reports.

PillPack supplies pre-sorted prescription drugs and other services to people who take multiple medications, a growing market as the US population ages and requires treatment for multiple complex, chronic conditions.

Although PillPack expects sales to exceed only about US$100 million this year, Amazon’s huge customer base and existing shipping infrastructure could allow the company to scale up quickly, the report noted.

Amazon could also negotiate directly with pharmaceutical companies, giving them the ability to offer cheap generic drugs even to customers without health insurance.

The value of the deal was not disclosed. According to the Wall Street Journal, the purchase price is around US$1 billion.

Pharmacy chains and drug wholesalers lost about US$14 billion in market value on Thursday, while Amazon gained about US$5.5 billion, Reuters said.

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RC

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