Amazon to acquire PillPack online pharmacy

Amazon to acquire PillPack online pharmacy

The company's services are aimed at people who take multiple medications, delivering drugs in pre-sorted dose packages.

Terms were not disclosed on the deal for PillPack, an online pharmacy which operates in all 50 USA states and offers pre-sorted dose packaging and home delivery.

"PillPack's visionary team has a combination of deep pharmacy experience and a focus on technology", Jeff Wilke, Amazon's CEO of worldwide consumer, said in a release. The parties expect to close the transaction during the second half of 2018.

The purchase follows the announcement in January that Amazon, Berkshire Hathaway Inc and JPMorgan Chase & Co were forming a joint venture to tackle rising US health care costs.

Amazon, which has become a retail behemoth since its start as an online bookseller in 1994, is known for its willingness to forego profit, while slashing prices to win customers.

The company had attracted interest from Walmart Inc, which was looking to buy it for under $1 billion, CNBC had reported in April. "We're excited to see what we can do together on behalf of customers over time".

The damage was felt all along the pharmacy supply chain, with the likes of CVS, Rite Aid, Cardinal Health, AmerisourceBergen, McKesson, and Express Scripts all dropping on the news.

Pharmacy shareholders will perhaps find solace in the fact that they're not the only industry to have billions in market value erased by a single Amazon announcement.

Echoing that sentiment, Morningstar senior analyst Vishnu Lekraj called the stock's tumble after the Amazon news a "huge overreaction", in an interview after the call.

Parker grew up behind the counter of his father's drug store in Concord, N.H., and has spoken of his exasperation seeing customers resort to spreadsheets to figure out how to schedule and sort their medications. "Pharmacy networks are controlled by managed care companies and pharmacy benefit managers with captive mail order capabilities".

A September 2016 funding round valued the Boston-based startup at around $360 million, according to venture capital data base PitchBook.

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