Amazon is buying online pharmacy PillPack — a move that could disrupt the drug store business.
PillPack has pharmacy licenses in all 50 states. The company delivers medications to customers in pre-sorted doses designed to make it easier for people to take multiple medications a day.
Amazon has widely expected to move into the pharmacy business.
The PillPack deal is scaring investors in the top two drugstore chains.
CVS fell 8% in early trading. Walgreens Boots Alliance, the newest Dow component, plunged nearly 10%. Walgreens was already trading lower after reporting in its latest earnings report that same-store sales in its US pharmacy business fell.
Rite Aid shares fell too, as did the stocks of big drug distributors Cardinal Health and AmerisourceBergen.
These and other healthcare stocks rose just a few months ago following reports that Amazon may not be interested in selling prescription drugs. So much for that.
The PillPack acquisition comes just a week after CVS announced it will start delivering prescriptions to people’s homes — a move that’s in response to growing competition from PillPack and Capsule, another online pharmacy startup.
Amazon’s entry into the pharmacy business comes at a time when Jeff Bezos, the world’s richest man, is also creating a new health insurance company along with Warren Buffett’s Berkshire Hathaway and banking giant JPMorgan Chase.