Amazon’s appetite for cross-sector cash-ins has been satiated for the most part, but the online retail giant’s foray into healthcare is shaping up to be a particularly interesting case study. The prescription-by-mail business has been shaken up by the entry of Amazon Pharmacy, which launched officially in November 2020 following the acquisition of PillPack two years prior. With a slight makeover of the ubiquitous delivery system it has honed over time, Amazon jumped headfirst into the deep end of mailed prescriptions. Now equipped with a portfolio that includes Pharmacy, Halo health band and service, life and health sciences cloud service, and employee primary care, it seems Amazon has made a major commitment to its healthcare pursuits.
The company’s rivalry with conventional pharmacies, however, remains heated. Well-established drugstore brands such as Walgreens, RiteAid, and CVS, along with retail competitors Walmart and Target, are confident that the numbers are still in their favor. GoodRx’s Chief Financial Officer, Karsten Voermann, indicated that third-party data spells doom for Amazon Pharmacy, and cited industry metrics that show mail-order prescriptions represent a meager 5% of fill count in the U.S.
Nevertheless, Amazon’s model has drawn positive evaluations from many of its customers. Existing accounts can be used for expedited set-up on Pharmacy profiles. Personal PIN codes are provided for general security and prescription privacy assurances. The system also compares any out-of-pocket expenses with standard insurance co-payment against an exclusive Prime membership premium. Time will tell if these and other benefits are enough to withstand competition from other pharmacies.