In the middle of the Corona crisis, the online retailer is pushing into a new market. There are billions of dollars involved.
Dhe online retailer Amazon.com is targeting another large market: Now he has announced the launch of his own Internet pharmacy in his home American market. Here, customers can order prescription drugs, which – like normal Amazon purchases – are then delivered to their homes.
The news caused considerable movement on the stock market and caused the share prices of large drugstore and pharmacy chains such as CVS Health, Walgreens Boots Alliance and Rite Aid to fall. The exchange rate losses amounted to 7 percent and more over the course of trading. Such an effect has often been observed when the online retailer entered new markets. When he announced the acquisition of the Whole Foods supermarket chain in 2017, the prices of many grocers fell.
An offensive by Amazon in the prescription drug business has been speculated for some time. It is a gigantic market with an estimated volume of around $ 500 billion a year in the United States.
In the middle of the corona crisis
The online retailer has gradually expanded its activities in the healthcare market. Over-the-counter medicines have been part of his range for some time, and some of them are also sold under his own brand name. He paved the way for the sale of prescription products two years ago with the acquisition of the online pharmacy Pillpack for just over $ 750 million.
Pillpack brought licenses for the sale of prescription drugs that Amazon could take advantage of. Almost three years ago, Amazon, together with the major bank JP Morgan Chase and Berkshire Hathaway, the holding company of Warren Buffett, founded a joint venture called Haven, which specializes in health care services for the respective workforce. However, it has become a bit quiet around this project, the chairman of the board resigned abruptly this spring.
The new online pharmacy “Amazon Pharmacy” is currently only available in America. The group starts it in the middle of the Corona crisis, in which more and more people are ordering online. “At a time when more and more people want to do their everyday errands from home, the pharmacy is an important and necessary addition to Amazon’s online store,” said Amazon manager Doug Herrington, responsible for the North American business, on Tuesday. Other pharmacy chains such as CVS Health also offer their customers home delivery of medicines.
If you want to use the new offer from Amazon, you can ask your doctor to send prescriptions directly to the online retailer, as he has done so far with other pharmacies. He can also have existing prescriptions from other pharmacies transferred to Amazon in order to reorder drugs. Amazon says it works with most health insurers.
If you are a member of the “Prime” customer loyalty program, Amazon promises delivery of the medication you have ordered within two days at no additional cost. “Prime” customers will also receive significant discounts on drugs that are bought without insurance. The discounts for branded products should be up to 40 percent, and for generic drugs even up to 80 percent. Amazon’s pharmacy has a wide range, but some drugs such as painkillers containing opioids are not on offer.
Amazon is considered one of the biggest winners of the corona crisis. The company has just reported a 37 percent jump in sales for its most recent fiscal quarter. It is growing so fast that it has expanded its workforce by almost 25,000 in that period alone.