Amazon has turned up the heat on its brick-and-mortar competition Tuesday with the launch of an online pharmacy, which will deliver prescription medications to its U.S. customers and offer hefty discounts for those paying without insurance.
The company said that Amazon Pharmacy, a dedicated section of its website, will make sure that “filling prescriptions is as convenient as any other purchase on Amazon’s online store.”
The service will be available to U.S. consumers from Tuesday, and will allow them to easily compare prices between insurance and non-insurance options, both of which can be used.
Members of Amazon Prime, the company’s subscription service, will be able to access sizable discounts if not paying with insurance — up to 80% on generic medicines and up to 40% on branded — both on Amazon’s site and in more than 50,000 participating pharmacies around the country.
The pharmacy offering expands upon Amazon’s acquisition of PillPack two years ago, which offers services to those managing multiple daily medications for chronic conditions and will remain open to those that need it.
While Amazon has managed to crack, and often dominate, most retail markets, the lucrative one for prescription pharmaceuticals has remained elusive. In 2018, it signalled its intent to close that gap, acquiring the small online pharmacy PillPack, a move that didn’t seem to shake competitors at the time, with Walgreens CEO saying the company was “not particularly worried” about the deal. Perhaps competitors shall worry today, with pharmacy stocks tumbling after the announcement and as consumers, as Amazon points out in its announcement, conduct more and more of their business from home in the midst of the Covid-19 pandemic.
Amazon Pharmacy Business Adds Online Store, Free Delivery For Prime Members (Forbes)
The inside story of why Amazon bought PillPack in its effort to crack the $500 billion prescription market (CNBC)