Amazon’s Purchase of PillPack – What It Means

When Amazon announced on Thursday they agreed to acquire online pharmacy PillPack for about $1 billion, eight Big Pharma stocks went tumbling, erasing about $17.5 billion in value.

READ MORE: Amazon Acquires PillPack

As with the Whole Foods Market acquisition, investors see Amazon entering the prescription medicine distribution business as a huge thread to existing pharmacies, but also the pharmaceutical supply chain and even some drug makers.

The company’s massive foothold in eCommerce, one that even Walmart struggles to slow down or make a dent in gaining any market share, represents a huge threat to Big Pharma.

But the simple acquisition of PillPack is not the only thing on investor’s minds. Just a few days ago, Amazon, Chase, and Berkshire Hathaway announced they have selected Atul Gawande as CEO to head their venture to “fix” healthcare in the U.S.

Purchasing PillPack for what amounts to a rounding error on the balance sheet, is just telegraphing Amazon’s intention to the healthcare industry that the company is ready to full disrupt that business. Get ready for Bezoscare!

READ MORE: From Obamacare to Bezoscare? Amazon May Lead The Way to Fix Healthcare

What Does This Mean For Small Business Sellers?

In the short term very little, but in the long term many small businesses that offer medical supplies, non-pharmaceutical products, may find rising sales as more consumer will turn to Amazon.com for their medical and pharmaceutical supply needs.

Amazon always makes the point that over half of its products on the marketplace are sold by third-party sellers.

It is not yet known how Amazon will integrate PillPack into Amazon. Will it remain an independent operation or will it somehow be incorporated into the main site?

Certainly, many of the existing relationships and licenses PillPack owns have a value for Amazon. It provides the company with a good starting point without having to start from ground zero.

PillPack already offers some over-the-counter meds, supplements, and vitamins, all categories which are available on Amazon from many third-party sellers.

That is why the integration of this business into the existing eCommerce business will be interesting to follow. How this may happen will determine if small businesses marketplace sellers will find a role within the PillPack pharmacy business.

What do you think about where Amazon is headed in healthcare? Let us know in the comments section down below or over on our Facebook Group.

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