A little over two years after its $753 million purchase of the Pillpack prescription drug distribution service, Amazon has finally launched Amazon Pharmacy, its buying and fulfillment service for online and mobile prescription drugs.
Customers can add their health records, manage prescriptions and select payment options all via Amazon’s service using a safe pharmacy profile. “And in another small step towards broader healthcare facilities, and not only selling goods (although, indeed the effect is to sell products), on Amazon’s site, customers are provided with “self-service assistance” resources, and they also have the choice of talking to pharmacists either over the internet, for advice: “Friendly and knowledgeable pharmacists are available 24/7 to answer prescription queries.
This is arguably Amazon’s broadest step into the healthcare sector to date, after introducing its own line of over-the-counter drugs in 2019, one that could open up very big, new revenue opportunities for the company, particularly as the ongoing COVID-19 pandemic drives customers both towards more remote treatment and using online platforms for all their shopping needs.
Indeed, as a one-stop shop for medicine and health, this is also more than just the ongoing growth of Amazon. Pharmacy shopping and grocery shopping go hand-in-hand for many customers (and of course, many stand-alone pharmacies have become more like shops selling food over the decades, while those selling food often have pharmacy counters).
Having this alongside the very active and optimistic food and grocery play of Amazon, which illustrates its drug strategy by spanning its own and purchased brands, including Amazon Fresh, Whole Foods, Amazon’s own brand items, and physical Amazon grocery stores, gives the company a more complete experience where shoppers can more completely substitute their shopping needs using Amazon alooo
For now, although Amazon Pharmacy looks to be a US-only launch, it is a worldwide opportunity. It is estimated that online pharmacy services will cross sales of $131 billion globally by 2025. Prescription drugs, meanwhile, have been estimated to be a $904 billion industry this year, growing to nearly $1.3 trillion by 2025.
“Doug Herrington, Senior Vice President of North American Consumer at Amazon, said in a statement, “As more and more customers look to complete regular purchases from home, the pharmacy is an essential and necessary addition to the Amazon online store. For over six years, PillPack has offered outstanding pharmacy services for individuals with chronic health conditions. We are now extending to Amazon.com our pharmacy offering, which will help more consumers save time, save money, simplify their lives, and feel healthier.
Amazon is carrying out exclusive features for Prime subscribers in addition to the basic Amazon Pharmacy service: those subscribing to the premium subscription tier of Amazon will enjoy unlimited free two-day shipping on Amazon orders, the company said in a statement.
If they pay without insurance at Amazon Pharmacy, Prime members can also save on drugs and enjoy the same discounts at 50,000 other participating pharmacies nationwide. When paying without benefits, the Amazon Prime drug savings benefit will save members up to 80% off generic and 40 percent on brand name drugs.
At checkout, Prime members will access their drug savings and all Amazon customers will be able to shop and order online for drugs, including branded and generic versions and various type factors and dosages.
Amazon is now encouraging consumers to compare rates with their co-pay policy, without insurance or with the discounts available to select the lowest choice through the Prime drug savings plan. Amazon also employs a pharmacy service available at all hours so that consumers can answer their prescription questions.
Taken together an Amazon Prime power user who shops at Whole Foods, uses Halo, and gets their prescriptions filled by Amazon Pharmacy provides the organization with perhaps the most complete insight that is possible regarding their wellbeing.
If Amazon were to carry out the Amazon Care program to customers, catastrophic care would be the only aspect of the healthcare spectrum the company wouldn’t touch. But it is not impossible to imagine a future where emergency care centers or hospitals pop up with an Amazon logo on them too, considering Amazon’s ambitions.