Amazon Continues Push into Health Markets

Amazon has continued its expansion into the medical health markets in all phases, here is a brief look into those activities that will affect you as a consumers.

Amazon Pharmacy

In June 2018, Amazon acquired online pharmacy PillPack for $753 million. This would eventually serve as the foundation for its Amazon Pharmacy service which launched in November 2020. Amazon Pharmacy originally allowed customers across 45 states to have access to unlimited, free deliveries of prescription medications and drug pricing transparency tools. With a Prime membership (which is $14.99 per month, or $139 per year if you pay annually), customers received free two-day delivery (along with assorted added benefits like Prime Video and discounts to Prime Reading and Prime Music to name a few). The pharmacy service has since expanded to customers in all 50 states with or without a Prime membership but still limits Prime prescription savings benefit discounts to members.

In January of this year, the company announced RxPass, a generic drug subscription service aimed at consumers with more than 80 common health conditions. The medication delivery service costs an additional flat $5 per month for Prime members. The savings benefit can be for discounts up to 80% off generic and 40% off brand-name medications at more than 60,000 participating pharmacies. Those Prime members can use the new service to order commonly prescribed generic medications including high blood pressure and acid reflux, and the service includes free delivery.

RxPass will target people with chronic conditions who require multiple prescription medications and pay for them out-of-pocket.  Christina Farr, an investor at San Francisco-based venture capital firm OMERS Venture, said launching RxPass was unsurprising given the company’s vast logistics networks and PillPack acquisition.

According to John Love, vice president of Amazon Pharmacy, noted that “At $5 a month, you know what you’re going to pay for your medications. In most places, that’s less than a mocha or a cup of coffee. This is the starting list, and we’re excited about the coverage that it provides,” he said in an interview. Vin Gupta, M.D., chief medical officer at Amazon Pharmacy and a practicing pulmonologist, said he has seen patients with chronic diseases struggle to get access to the basic medications they need to live their lives well. Those barriers can lead to poor outcomes as new medications don’t get filled, refills don’t get picked up and patients suffer, he noted. Amazon Pharmacy aims to improve that experience by offering value, convenience and price transparency, he noted. “These are features that up until very recently just had not existed. As a provider, I’m really excited not just about what RxPass means for patients but what we’re trying to do more broadly as a pharmacy,” Gupta said. “We think that this is going to be meaningful to a broad swath of the country, not just those with chronic non-communicable diseases like hypertension,” he said.

A J.D. Power study last year found that companies such as Amazon represent a growing threat to retail pharmacies, at least in terms of how patients purchase their medications. Nearly two-thirds (66%) of brick-and-mortar pharmacy customers currently have an Amazon Prime account, and nearly half (48%) of pharmacy customers are aware of pharmacy services offered by Amazon, the J.D. Power study found. Fourteen percent of customers know about Amazon’s PillPack online pharmacy service. “Of that group, 38% say they ‘definitely will’ switch pharmacies in the next 12 months,” the J.D. Power study stated. “The pandemic has changed a lot about how patients want to consume care,” Gupta said. “I hear it all the time, ‘Hey Doc, I’d love to see you at a clinic or in the hospital, but if I can get my services at home, conveniently and you can make sure it’s safe and appropriate, well, that’s great.’ That’s exactly what Amazon Pharmacy is really leaning into. It’s meeting this moment where patients across the country have more agency, they know their bodies more and they’re more discerning when it comes to how they want to consume healthcare services.” He added, “Amazon is leaning into its core strengths and last-mile delivery to meet patients at their doorstep and Amazon Pharmacy, at its core, enables that type of interface.”

Amazon Clinic

As a part of this overall push into medical health markets, in November 2022, Amazon launched virtual health offering Amazon Clinic in 32 states, allowing users to access third-party telehealth providers for non-urgent health conditions ranging from sinusitis, urinary tract infections, allergies, hair loss and skin conditions. Patients can send prescriptions to any pharmacy including Amazon’s in-house pharmacy service. The service operates as a “virtual health storefront” offering users access to third-party telehealth providers. This service does not accept insurance for visits but users can choose to use health savings accounts for payment.

One Medical 

Amazon’s $3.9 billion acquisition of One Medical is the company’s latest and potentially most significant move.  In July 2022, Amazon announced its intent to acquire the primary care provider. The deal drew interest from federal regulators and took seven months to close. With the deal finalized, Amazon inherits One Medical’s 836,000 members and 221 medical offices across 27 markets, according to regulatory filings by One Medical’s parent company 1Life Healthcare. By acquiring One Medical’s in-person clinics, Amazon dramatically increases the services it’s able to offer patients, said Jacob Effron, principal at venture capital firm Redpoint Ventures. Effron said the tech giant is trying to build an end-to-end patient experience in a way that can scale quickly. It could also lead to an extension of brick-and-mortar storefronts, experts say. “Following the leads of other retail, I imagine we’ll see some collaboration of this [One Medical] storefront with other storefronts they own [such as Whole Foods],” said Nathan Ray, a partner in consultancy West Monroe’s healthcare and life sciences practice.


Amazon is aggressively acquiring the means to be a one-stop shop for a host of your medical needs. As it captures more of the health markets, it will mean a consolidation of medical services and other large companies are already moving to answer the challenge.

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