Amazon agrees to buy PillPack, an online pharmacy

Above PillPack

Above PillPack

But the online retail giant's decision to buy online pharmacy PillPack rapidly accelerates the threat posed to entrenched retailers, suppliers and middlemen.

Founded in 2013, Boston-based PillPack is an online pharmacy that ships pre-packaged doses of medication straight to customers' doors. PillPack has also developed expertise in battling with payers and pharmacy benefit managers to have its services covered, and Amazon will bring new clout to those negotiations.

TJ Parker, PillPack's co-founder and chief executive, said: "Together with Amazon, we are eager to continue working with partners across the healthcare industry to help people throughout the USA who can benefit from a better pharmacy experience". The parties expect to close the transaction during the second half of 2018.

Amazon's ambitions to become an online pharmacy are finally coming to fruition.

PillPack sorts prescription medications into packages based on when doses need to be taken. The company had raised $118 million and TechCrunch pegged the acquisition price at almost $1 billion, which would make it one of Amazon's largest acquisitions to date.

Amazon's acquisition of PillPack is sure to rankle the business-development team at Walmart, which was reportedly looking at buying the pharmacy startup in early April.

Amazon is also working with JP Morgan Chase and Berkshire Hathaway on a new health care company that is seeking to lower costs and improve care. CVS Health, Walgreens and Express Scripts Holding opened down on the news. Evercore ISI analysts wrote that it's now "undeniable" that Amazon is entering the pharmacy industry, according to CNBC's Meg Tirrell. Walgreens shares dropped roughly 10 percent, while CVS shed almost 9 percent in premarket trading in NY.




CVS Health noted that PillPack isn't the only company in the space with drug delivery capabilities.

The pact follows months of speculation about Amazon's plans to get into the pharmacy or drug-distribution business.

Amazon did not say how much it was paying for PillPack.

Walgreens stock was down 9.46% in pre-market trading.

Some analysts played down the immediate threat Amazon poses.

"I think this move jump-starts efforts and clears some hurdles [for Amazon], and what it's really going to do is fast-track any moves they want to make to get licensed", Rea said.

On its own, PillPack had raised $118 million in funding from venture capital firms and has been valued at $360 million. The company raised more than $118 million from brand-name investors including Accel, Sherpa Capital and NY rapper Nas's Queensbridge Venture Partners.

Recommended News

  • First public beta of iOS 12 released

    First public beta of iOS 12 released

    For Apple users willing to try the beta, it's good idea to back up your device on iTunes before installing the software. Developers will be able to take advantage of a new file format for augmented reality and new features in ARKit 2 .0.
    New Zealand leader recovers with mac-n-cheese after birth

    New Zealand leader recovers with mac-n-cheese after birth

    New Zealand Prime Minister Jacinda Ardern will spend a second night in hospital with her newborn daughter, her office said Friday. The little girl, affectionately being called the first baby, was born at Auckland City Hospital weighing 7.3lb on Thursday.
    Amazon leaked Prime Day 2018 details

    Amazon leaked Prime Day 2018 details

    Expect Amazon to offer heavy discounts on its own products, but also on some of the newest and most popular products available. BT has become the first United Kingdom pay TV provider to offer Amazon Prime Video access via its set-top box.
  • Brave Iceland sunk by late Croatia strike

    Croatia had its first clear chance when Milan Badelj's missile crashed onto the bar six minutes into the second half. Croatia kept its flawless record at the 2018 FIFA World Cup while sending Iceland home on Tuesday.
    Oil train derails in Iowa, spilling crude into the river

    Oil train derails in Iowa, spilling crude into the river

    Governor Adam Gregg listen to flood victims while visiting the northwest Iowa flood regions and the BNSF train derailment. Metropolitan Utilities District, which provides the Omaha metro area's drinking water, said it was monitoring the spill.
    SCOTUS rules states can collect taxes from online shopping transactions

    SCOTUS rules states can collect taxes from online shopping transactions

    Avalara helps companies around the world comply with sales tax laws using automation software. The Supreme Court agreed to overturn those decisions in a 5-4 ruling.
  • Jimmy Fallon, Donald Trump Feud - Watch Response On Tonight Show

    Jimmy Fallon, Donald Trump Feud - Watch Response On Tonight Show

    I'm paid to make people laugh. "Get over it."' Fallon adds, 'I'm sorry if I made anyone mad. Jimmy Fallon is using his own soapbox to clap back at President Trump .
    Why the Socceroos don't need Cahill to beat Peru

    Why the Socceroos don't need Cahill to beat Peru

    Van Marwijk said he expected the French to play for the win given their unconvincing showings in Russian Federation to date . Farfan himself took to social media to confirm that despite his desire to play, he must miss Peru's final group game.
    Egypt keeper El Hadary becomes World Cup's oldest player

    Egypt keeper El Hadary becomes World Cup's oldest player

    He became the first player to be sent off for the World Cup hosts since Itumeleng Khune's red card for South Africa in 2010. Salah is also clearly not fully fit, but managed to score two goals in his two appearances, one from the penalty spot.
  • Trump Blasts Harley-And Gets Facts Wrong-Again

    Trump Blasts Harley-And Gets Facts Wrong-Again

    The president has repeatedly attacked Amazon.com Inc over what he sees as its unfair treatment of the U.S. According to Bloomberg , Harley's USA sales have dropped every quarter since Q1 2015.
    The permutations and predictions for the final World Cup group matches

    The permutations and predictions for the final World Cup group matches

    Russian Federation advanced from Group A as a runner-up, and will square off with Group B victor , Spain , on Saturday as well. El Tri only need a draw against Sweden on Wednesday to officially make it through, while a win will guarantee them top spot.
    Maradona shows middle fingers on camera as Argentina score winner

    Maradona shows middle fingers on camera as Argentina score winner

    The team now sit in third in the group with one draw from two games, behind France with six points and Denmark with four. Should France and Australia win, the Socceroos will be tied on four points with Denmark .

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.