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Amazon Launches Prescription Delivery Service
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On Nov. 17, Amazon launched Amazon Pharmacy, a service that allows customers to order prescription medication online from their desktop or mobile device through the Amazon app. Customers can have their medication conveniently delivered to their residence instead of filling their prescription in-person at a pharmacy.
Amazon accepts most insurance plans and offers markdowns on medication for eligible customers who do not have insurance. The company also provides a self-service help section and the option to speak with a pharmacist, who is available 24/7 to answer any questions a customer may have about their medication.
Amazon Pharmacy is currently available in 45 states, excluding Hawaii, Illinois, Kentucky, Louisiana, and Minnesota. Amazon plans to expand its service in the future.
Prime members receive more perks than regular customers, which include free two-day shipping while non-Prime members have free five-day shipping. Prime members also have access to the prescription savings benefit, which offers discounts up to 80% off generic medication and 40% off brand name when paying without insurance. The special deals are available online and in over 50,000 participating pharmacies across the United States.
Amazon’s New Frontier
Amazon just launched the new prescription delivery service but it has previously ventured into healthcare. In 2018, the company acquired PillPack, a pharmaceutical delivery startup that ships medication on a 30-day schedule. PillPack was rebranded as PillPack by Amazon Pharmacy and operates as a separate service, as it is structured for customers with chronic health conditions.
PillPack’s infrastructure helped build Amazon Pharmacy, which includes its pharmacy software, fulfillment centers, and relationships with healthcare providers. PillPack’s co-founder, TJ Parker, is now the Vice President of Amazon Pharmacy.
Amazon Pharmacy poses a threat to brick-and-mortar pharmacies, like CVS, Walgreens, and Rite Aid, who generally lack the fulfillment infrastructure to compete and have only recently begun to offer prescription delivery services.
The pharmaceutical industry is highly competitive and valued at over $300 billion in the United States. The company’s e-commerce approach is well timed as more consumers are ordering essential and nonessential goods online to avoid the risk of exposure to COVID-19. Receiving prescription medication through mail could become the “the new normal” during the pandemic and onward.
Amazon’s Senior Vice President of North American Consumer, Doug Herrington, expressed the value he sees in offering a digital pharmacy. “As more and more people look to complete everyday errands from home, pharmacy is an important and needed addition to the Amazon online store,” said Herrington.
Amazon Pharmacy launched at an ideal time as people are limiting in-person interactions due to the pandemic and could greatly benefit from ordering their prescription medication online. Amazon also offers the option to speak with a pharmacist, who is available 24/7 to answer customer questions.
Although the pharmaceutical industry is very competitive, Amazon’s e-commerce approach and discounts on medication (available to Prime members) may draw people to fill their prescription using its digital platform instead of visiting a pharmacy. The company’s initiative could pave the way for a “new normal” in the fulfillment of medication.