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Amazon’s Long-Awaited Invasion Of The Pharmacy Business Has Begun.

Amazon’s Long-Awaited Invasion Of The Pharmacy Business Has Begun.

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Amazon today said it was buying mail-order drug-seller PillPack for an undisclosed sum, ending many months of speculation and anxiety in the health-care business that Amazon, Destroyer of Industries, was coming for drugstores next. Turns out it is! Shares of pharmacies and pharmacy benefit managers Rite Aid Corp., CVS Health Corp. and Express Scripts Holding Co. fell. And extra sympathy to Walgreens Boots Alliance Inc., which began its earnings call just as the Amazon deal was announced; its stock tumbled 10 percent, just a week after it replaced General Electric Co. in the Dow Jones Industrial Average.(Bloomberg)

UPDATED: News broke late last week that Amazon was buying mail-order drug-seller PillPack for an estimated US$1B, ending many months of speculation and anxiety in the health-care business,
The Amazon acquisition immediately gives the retail giant a nationwide drug network, threatening to upend the entire industry.
Shares of pharmacies and pharmacy benefit managers Rite Aid Corp., CVS Health Corp. and Express Scripts Holding Co. fell on the news.
Walgreens Boots Alliance Inc., which began its earnings call just as the Amazon deal was announced, saw its stock tumble 10 percent, just a week after it replaced General Electric Co. in the Dow Jones Industrial Average.
The industry’s big, justified fear is that Amazon will do what it has done to other businesses it has invaded: destroy profit margins.
It was also pointed out that PillPack could be a useful tool for Amazon’s mysterious joint health-care venture with Berkshire Hathaway Inc. and JPMorgan Chase & Co. – which may or may not threaten an even wider swath of health-care industries.

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