Amazon is acquiring online pharmacy PillPack in a deal that could shake up the drugstore industry.
Terms of the deal were not disclosed. The companies expect the deal to close during the second half of the year.
The deal is the strongest indication yet of Amazon’s intent to move further into the health-care industry. It threatens to remove one of the few distinguishing factors pharmacy chains have relied on to fend off Amazon, the sale of prescription drugs. Retailers like Walgreens Boots Alliance, CVS Health and Rite Aid have seen their so-called “front of store” sales threatened as shoppers increasingly buy household staples online or from convenience stores.
Shares of all three tanked Thursday on the news.
“Yes, it’s a declaration of intent from Amazon,” Walgreens Boots Alliance CEO Stefano Pessina acknowledged to analysts in a planned call to discuss its quarterly earnings, according to an initial transcript from FactSet. “[But] the pharmacy world is much more complex than the delivery of a certain [pills or] packages.
PillPack, which organizes and delivers packages of medications for consumers, is licensed to ship prescriptions in 49 states. The company previously had sale talks with Walmart, which had considered buying the start-up for less than $1 billion, CNBC has reported.
Amazon already sells private label over-the-counter drugs through a partnership with Perrigo and has obtained pharmacy licenses in a few states. It also has licenses to distribute medical devices in nearly every state.
“PillPack’s visionary team has a combination of deep pharmacy experience and a focus on technology,” Jeff Wilke, Amazon CEO Worldwide Consumer, said in a statement. “PillPack is meaningfully improving its customers’ lives, and we want to help them continue making it easy for people to save time, simplify their lives, and feel healthier. We’re excited to see what we can do together on behalf of customers over time.”
Source: Tech CNBC
Amazon to acquire online pharmacy PillPack in a deal that could disrupt the US drugstore business