Legal News

Amazon Buys Prescription Drug Mailer for $1 Billion
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

Photo courtesy of Reuters.

Summary: Amazon has agreed to buy prescription drug startup, PillPack. 

Amazon has its sights set on the US healthcare system, particularly the prescription drug industry. Bloomberg reported that the multi-billion dollar internet retailer has sealed the deal to buy PillPack for $1 billion.

  
What
Where


PillPack is an online pharmacy that sends medication by the dose to your door. Its beneficial for users with chronic conditions because it sends 14-day dosages but divides them into daily packages for free.

Bloomberg said that Amazon’s acquisition has pharmacy retailers like CVS and Walgreens nervous. Almost immediately after Amazon’s buy was announced, CVS shares sank by 8.9% while Walgreens shares fell by 8.5%. CNBC said that Walmart lost $3 billion in the stock market.

Lisa Bielamowicz, president of consultancy Gist Healthcare, told Bloomberg that Amazon’s deal with PillPack can affect the pharmacy industry just like Amazon has affected other industries.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!




“This provides an avenue for Amazon to disrupt major pharmacy chains the way that they’ve disrupted booksellers, pet supplies, clothing and other big-box retailers,” Bielamowicz said.

The deal is expected to close later on in 2018, and entering the drug space could mean major dollars for Amazon.



Bloomberg said, “The U.S. market for prescription medicine is vast. In 2016, U.S. consumers spent $328.6 billion on retail prescription drugs, according to U.S. government data. CVS had prescription sales of $59.5 billion last year, while Walgreens sold $57.8 billion worth of drugs in its fiscal 2017.”

PillPack has approval in all 50 states to mail prescription drugs and relationships with drug supplies, which would allow Amazon to expand into the drug market quickly. The startup also has software that examines when refills are needed or how to charge copays, and their automated system eliminates work that some pharmacists are burdened with now.

Michael Rea, CEO of Rx Savings Solutions, told Bloomberg that the Amazon-PillPack deal could change the industry and was a sign of the times.

“This move signals just how big of a market opportunity there is to change the pharmacy landscape,” Rea said.

Amazon started out as an online bookseller and has since grown the brand to sell everything from clothing to groceries. It has purchased other companies such as IMDB, the internet movie database; Whole Foods; Zappos; Goodreads; and Audible.

Bloomberg stated that Amazon founder and CEO Jeff Bezos has wanted to change the healthcare industry for quite some time.

“Bezos already has signaled his frustration with a health-care system characterized by rising costs for consumers and companies, sometimes-poor outcomes, and unnecessary complexity. Earlier this year, he and fellow CEOs Warren Buffett and Jamie Dimon of Berkshire Hathaway Inc. and JPMorgan Chase & Co., respectively, agreed to form a new venture to reshape how the companies handle worker health benefits. The entity recently hired celebrated surgeon and health journalist Atul Gawande to steer the effort,” Bloomberg said.

What do you think of Amazon’s latest purchase? Let us know in the comments below.



 

Interesting Legal Sites You May Like


BCG FEATURED JOB

Locations:

Keyword:



Search Now

Business Litigation Attorney

USA-CA-Santa Monica

Santa Monica office of our client seeks business litigation attorney with 1-3 years of experience. T...

Apply Now

Intellectual Property Litigation / Enforcement Associate Attorney

USA-CA-San Francisco

San Francisco office of our client seeks intellectual property litigation / enforcement associate at...

Apply Now

Corporate Attorney

USA-CA-Menlo Park

Menlo Park office of sophisticated boutique firm is seeking a corporate attorney with experience in ...

Apply Now

Mid-level Computer Science Patent Attorney

USA-CA-San Francisco

San Francisco office of our client seeks mid-level patent attorney with 3-5 years of intellectual pr...

Apply Now

RELEVANT JOBS

Search Docket Administrator

USA-IL-Evanston

Cardinal Intellectual Property is seeking an administrator to help perform a variety of tasks within...

Apply now

Associate - Mid-Level - GL Group

USA-NY-Valhalla

Defense firm seeking mid-level associate for Westchester office to fill General Liability position. ...

Apply now

Hotline & Training Managing Attorney (IMMIGRATION)

USA-NY-New York City

The Hotline & Training Services Managing Attorney will guide, develop, and supervise the Hotline sta...

Apply now

Litigation paralegal

USA-TX-Dallas

We are looking to immediately hire a responsible, highly organized, self-motivated litigation parale...

Apply now

SEARCH IN ARCHIVE

To Top