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Amazon Drops its Mighty Hammer on the Pharmaceutical Industry With Purchase of PillPack
Amazon announced on Thursday that it had acquired online pharmacy PillPack, immediately shaking up the pharmaceuticals industry and sending shares of some of the biggest companies tumbling.
PillPack “delivers medications in pre-sorted dose packaging,” while also handling refills, according to Amazon’s announcement of the deal.
“PillPack’s visionary team has a combination of deep pharmacy experience and a focus on technology,” Jeff Wilke, Amazon CEO Worldwide Consumer, said in a statement. “PillPack is meaningfully improving its customers’ lives, and we want to help them continue making it easy for people to save time, simplify their lives, and feel healthier. We’re excited to see what we can do together on behalf of customers over time.”
Terms of the deal were not disclosed.
Amazon’s acquisition immediately sent shock waves through the markets: Rite Aid, Walgreens Boots Alliance and CVS Health lost $12.8 billion in market value on Thursday after the announcement, as CNBC reports. Rite Aid dropped 11 percent, Walgreens Boots Alliance fell 9 percent and CVS Health lost 8 percent, respectively according to CNBC.
PillPack, which is available in 49 states, has raised $118 million, according to its website. Its investors include Accel Partners, Atlas Venture, CRV, Founder Collective, Menlo Ventures, Sherpa Ventures and Techstars.
CVS Health sent a statement to CNBC that said in part:
“We already have the capabilities that PillPack is offering and we have scale in the business. Keep in mind, that we have not seen a large shift of patients that are looking for their medications to be delivered versus coming to a retail pharmacy. And for those patients that do desire to transition, we offer the option to ship their prescriptions to their home from our pharmacies or obtain the prescriptions through our Caremark mail facilities.”
Amazon’s acquisition of PillPack is subject to regulatory approvals. The deal is expected to close during the second half of the year.