Amazon Launches Amazon Pharmacy, Prescription Delivery Service
Although the announcement comes when many patients are trying to avoid unnecessary trips to stores or physicians’ offices, the offerings of Amazon will have a massive impact on traditional retail pharmacies.
Online shopping giant Amazon has announced 2 pharmacy offerings, including Amazon Pharmacy and a prescription savings benefit for Amazon Prime members.1
The online service allows customers to complete their entire pharmacy transaction online with the Amazon app, using a secure pharmacy profile.1 Prime members will automatically receive unlimited, free 2-day delivery on their orders and will also access savings on medications when paying without insurance and at more than 50,000 participating pharmacies nationwide, according to the press release. Specifically, the release said the prescription savings benefit saves members up to 80% off of generic medications and up to 40% off of brand name medications.1
“As more and more people look to complete everyday errands from home, pharmacy is an important and needed addition to the Amazon online store,” said Doug Herrington, senior vice president of North American Consumer at Amazon, in the press release. “PillPack has provided exceptional pharmacy service for individuals with chronic health conditions for over 6 years. Now, we’re expanding our pharmacy offering to Amazon.com, which will help more customers save time, save money, simplify their lives, and feel healthier.”1
Amazon PillPack is a distinct service for customers with multiple daily medications, in particular older adults or those with chronic conditions. According to Amazon, PillPack is still recommended for patients taking multiple medications and who prefer pre-sorted dose packaging.1
Earlier in 2020, some independent pharmacists expressed concern to Pharmacy Times over Amazon’s Pillpack, describing what some believe is the company sending unsolicited phone calls to their patients as a way of requesting transfers of prescriptions, which they noted raises privacy concerns. Dan Steiber, RPh, editor-in-chief of Directions in Oncology Pharmacy, said he believes PillPack may be more of a threat to retail pharmacies during the coronavirus disease 2019 (COVID-19) pandemic as consumers are shopping from home and limiting outings.
"It's important to note that specialty and many other health products are not available [in Amazon Pharmacy], and that prescriptions from PillPack are limited to 30 days," Steiber said in an email to Pharmacy Times. "A key inflection point for Amazon will be access to [pharmacy benefit managers], as they may be seen as a mail order competitor and could potentially be bumped from the network."
Speculation has surrounded Amazon's potential entry into the pharmacy landscape for years. In 2018, billionaire hedge fund manager Larry Robbins told CNBC that the value of the pharmacist cannot be replaced by an automated system.
“Unlike many businesses that Amazon has appropriately automated, there’s always going to be a human pharmacist that has a role both regulatorily as well as consumer preference because we’re dealing with life-saving medical issues,” he said.
Although the announcement comes when many patients are trying to avoid unnecessary trips to stores or physicians’ offices, the offerings will have a massive impact on traditional retail pharmacies. According to a report by the Associated Press, the stocks of CVS Health Corp, Walgreens, and Rite Aid all fell following the announcement. Despite increasing pushes to expand online and delivery options, Amazon’s sheer size and ability to deliver quickly pose a threat.2
“This news represents a disruption to the system and competitive threat that will likely shift scrips away from the retail channel,” said Citi Research analysts in reporting by the Associated Press.2
- Introducing Amazon Pharmacy: Prescription Medications Delivered [news release]. Amazon; November 17, 2020. https://press.aboutamazon.com/news-releases/news-release-details/introducing-amazon-pharmacy-prescription-medications-delivered. Accessed November 17, 2020.
- Pisani J, and Murphy T. Amazon opens online pharmacy, shaking up another industry. Associated Press; November 17, 2020. https://apnews.com/article/amazon-opens-online-pharmacy-ebebe13bef54220ec3b0c7ffdcda2a68. Accessed November 17, 2020.