TECHNOLOGY

Amazon is now a drug store. It will ship prescriptions to Prime members

Nov 17, 2020, 7:59 AM
Customers can now purchase prescription medications through Amazon Pharmacy -- convenient and relia...
Customers can now purchase prescription medications through Amazon Pharmacy -- convenient and reliable access, without leaving home. Credit: TY MECHAM/Business Wire

    (CNN) — Amazon is making its biggest leap into the multi-billion-dollar health care industry with the launch of Amazon Pharmacy, a new digital drugstore.

The US-based service, which became available to customers Tuesday, works just like a traditional drugstore with special added perks for Prime members. Amazon Pharmacy accepts most major insurance with the ability to manage orders on its website. Prime members can get free two-day delivery.

There’s also a savings benefit plan for those without insurance or people who don’t want to pay with their insurance plans. Amazon Pharmacy is offering an 80% discount on generic medications and 40% off brand names. Amazon said its new service makes it “simple for customers to compare prices and purchase medications for home delivery,” adding that the tedious task is now “as convenient as any other purchase” on Amazon.

“As more and more people look to complete everyday errands from home, pharmacy is an important and needed addition to the Amazon online store,” Doug Herrington, senior vice president of North American Consumer for Amazon, said in a statement.

Amazon Pharmacy is an extension of PillPack, the drugstore startup Amazon bought for more than $700 million in 2018. PillPack has pharmacy licenses in all 50 states and delivers medications to customers in pre-sorted doses designed to make it easier for people to take multiple medications a day.

That same year, Amazon announced a health care venture with Berkshire Hathaway and JPMorgan Chase, but nothing substantial has come from that yet.

Hints of an Amazon drug store launch appeared in 2019 when Amazon tweaked the branding from “PillPack, an Amazon company” to “PillPack by Amazon Pharmacy.” PillPack will still exist as a “distinct service for customers managing multiple daily medications for chronic conditions,” noted Amazon.

Shares of Rite Aid, Walgreens and CVS Health all tumbled sharply in premarket trading following Amazon’s announcement. Pharmacies have been squeezed as people have filled fewer prescriptions in stores during the pandemic. Some doctor’s offices closed, while many elective procedures have been put on hold and some shoppers have switched to mail-order drug delivery.

Preparing for the future, Rite Aid and CVS have recently revealed store remodels with a greater emphasis on health services that is more challenging to be replicated online, including appointments with health care professionals and minor procedures with licensed clinicians.

GoodRx, a discount drug program that doesn’t require insurance, also fell 10% in premarket trading.

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Amazon is now a drug store. It will ship prescriptions to Prime members