Amazon

Amazon launches online pharmacy in new contest with drug retail

Amazon.com Inc (NASDAQ:AMZN) on Tuesday launched an online pharmacy for delivering prescription medications in the United States, increasing competition with drug retailers such as Walgreens, CVS and Walmart (NYSE:WMT).

Called Amazon Pharmacy, the new store lets customers price-compare as they buy drugs on the company’s website or app. Shoppers can toggle at checkout between their co-pay and a non-insurance option, heavily discounted for members of its loyalty club Prime.

The move builds on the web retailer’s 2018 acquisition of PillPack, which Amazon said will remain separate for customers needing pre-sorted doses of multiple drugs.

The company founded as an online bookseller has disrupted industries including retail, computing and now potentially pharmaceuticals, drawing criticism of its size and power from labor groups and lawmakers along the way.

Amazon faces entrenched competition from Walgreens Boots Alliance (NASDAQ:WBA) Inc, CVS Health Corp (NYSE:CVS), Walmart Inc, Rite Aid (NYSE:RAD) Corp, Kroger (NYSE:KR) Co and others. Take-up of online ordering of drugs has been low, according to market research from J.D. Power.

Should Prime members prefer buying in person, Amazon said its discounts on non-insurance purchases apply at more than 50,000 brick-and-mortar pharmacies – including those run by rivals. Inside Rx, a subsidiary of Cigna Corp (NYSE:CI)’s Evernorth, administers that benefit, Amazon said.

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