Amazon's attack on the pharmacy industry has begun

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Amazon's attack on the pharmacy industry has begun

"Together with Amazon, we are eager to continue working with partners across the health care industry to help people throughout the USA who can benefit from a better pharmacy experience".

PillPack, which launched in 2014, is available in every U.S. state except Hawaii.

"With Amazon + PillPack this eliminates the need to stand in line at the pharmacy which may help overcome past barriers, especially if that patient has issues with mobility or transportation", said Forrester Analyst Arielle Trzcinski. Terms of the deal were not disclosed, but TechCrunch and Bloomberg reported the deal was for "just under $1 billion".

The deal comes as the health care industry is undergoing a series of convulsions in response to rising costs and pressure on drug makers, pharmacy benefit managers, and insurers. Investors immediately stripped billions in value from brick-and-mortar pharmacy stocks. Walgreens stock was down 9.46% in pre-market trading. The big pharmacy chains have been bracing for Amazon's arrival, and this deal could "shake up the drugstore industry", per CNBC. McKesson, Cardinal Health and AmerisourceBergen shares were all down after the news. The startup serves tens of thousands of customers and last summer launched PharmacyOS, a system created to simplify interactions between pharmacies, patients and payers and assist patients who manage multiple prescriptions.

Moreover, Amazon is working with Warren Buffett's Berkshire Hathaway Inc. and JPMorgan Chase & Co. on a joint venture that will provide healthcare services to their more than 1 million employees.

"While we can argue that PillPack's scale is minuscule and it is hard to envision it being particularly relevant broadly for the foreseeable future it just won't matter frankly".

"We wouldn't be surprised to see pharmacies in Whole Foods at some point", he told the news service.

Some analysts played down the immediate threat Amazon poses.

PillPack was a 2014 finalist for Co.Design's Innovation By Design Awards.

In 2017, the company gained approval from more than a dozen states to become a wholesale pharmaceutical distributor.

TJ Parker, a second-generation pharmacist and the company's chief executive officer, and Elliot Cohen, a computer scientist and the chief technology officer, each own roughly 10 percent of the online prescription drug retailer, a person familiar with the matter said.

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