Amazon.com Inc on Thursday set its sights on the pharmacy market with the acquisition of tech-focused retailer PillPack, sending shock waves through the sector over prospects of disruption by the US online colossus.
Amazon has long been rumored to be interested in the pharmacy business and the entry by a powerful new player could unsettle a business dominated by large US chains, including CVS Health Corp and Walgreens Boots Alliance Inc.
Terms were not disclosed about the deal for PillPack, an online pharmacy which operates in all 50 US states and offers presorted dose packaging and home delivery.
Photo: EPA
Some media reports said Amazon paid US$1 billion and outbid rival retail giant Walmart Inc.
“PillPack’s visionary team has a combination of deep pharmacy experience and a focus on technology,” Amazon Worldwide Consumer chief executive Jeff Wilke said in a statement. “We want to help them continue making it easy for people to save time, simplify their lives and feel healthier.”
CVS shares slid 6.1 percent at the close on the news, while Walgreens shares slumped 9.9 percent.
Neil Saunders of the research firm GlobalData Retail called the Amazon acquisition “a warning shot” for the pharmacy sector.
“Not only has Amazon finally made a solid move into pharmacy, it has done so via an innovative supplier which helps patients manage and organize their prescription drugs,” Saunders said in a research note. “[This] is only the first play in an increasingly aggressive strategy.”
“This is incredibly bad news for traditional players, like Walgreens and CVS, who stand to lose the most from Amazon’s determination to grow its share,” Saunders added.
Saunders said that “Amazon’s entry into any market will put downward pressure on prices and upward pressure on costs as others try to match its service,” and that CVS and Walgreens could be vulnerable.
Walgreens chief executive Stefano Pessina on Thursday told a conference call on the firm’s quarterly results that “we are not particularly worried” about Amazon, but added that “we know that we have to change the level of our services to the customers and we are working quite hard on that.”
PillPack was launched by two members of the “hacking medicine” initiative at the Massachusetts Institute of Technology.
It helps people manage multiple medications with a software platform that offers reminders, dose-specific packaging and delivery.
The Boston-based company has said it has raised US$118 million from investors and venture funds since its launch in 2013.
“Together with Amazon, we are eager to continue working with partners across the healthcare industry to help people throughout the US who can benefit from a better pharmacy experience,” PillPack cofounder and chief executive T.J. Parker said in a statement.
Amazon and PillPack said they expected to close the deal by the end of the year, subject to regulatory approval.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six