Homepage / Technology / Drug middleman Express Scripts is getting peppered with questions about Amazon and health care
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Technology

Drug middleman Express Scripts is getting peppered with questions about Amazon and health care

Express Scripts‘ president and CEO Tim Wentworth was peppered with questions about Amazon on its earnings call earlier this week.

Wentworth, who runs one of the largest pharmacy benefits management organizations — otherwise known as PBMs — appears to have contemplated this question quite a bit.

“So as I think about Amazon and what they may choose to do in pharmacy, you said it right in the beginning, which is, you know, becoming a PBM is a lot more than dispensing drugs,” he responded to an analyst.

PBMs act as intermediaries between payers, like health insurers, and the rest of the health system.

Speculation has ensued for months that the company will attempt to disrupt PBMs like Express Scripts, and bring some transparency to drug pricing. CNBC reported in May that Amazon has a secret health team and is hiring experts to help steer it into the multibillion-dollar pharmacy market.

All of this puts Express Scripts in a tricky spot.

Wentworth suggested that the company would be open to working with Amazon rather than competing with them. “If Amazon were looking to be an efficient provider in networks, we would welcome that opportunity,” Wentworth told analysts on the call.

Some experts find this move to be somewhat surprising.

“Typically there is only 1 mail order pharmacy in a PBM and it’s the one owned by the PBM,” said Adam Fein, president of Pembroke Consulting and author of Drug Channels. “It’s unusual for them to signal this.”

It’s still early days for Amazon, and the company hasn’t announced anything official. The company might prioritize other areas first, said Fein. As CNBC reported this week, the company is also interested in other areas like telemedicine and electronic medical records.

“Amazon has a long way to go before it becomes a mail order pharmacy,” said Fein, who pointed to myriad challenges ahead ranging from regulatory to technical. And if it were to become a network pharmacy, he said, it would need to build the “back engine” to accept insurance and adjudicate claims.

“I think Amazon has more lucrative areas to go after than becoming a PBM,” he said.

Source: Tech CNBC
Drug middleman Express Scripts is getting peppered with questions about Amazon and health care

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