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article imageAmazon drops plan to sell bulk pharmaceuticals

By Tim Sandle     Apr 22, 2018 in Business
Amazon Business, which is the bulk products arm of Amazon, appears to be dropping its plan to become a major distributor of pharmaceutical and medical devices products. This follows on from indications last year that Amazon was to enter the fray.
According to Pharmaceutical Manufacturing magazine, Amazon has changed course following an in-depth review of the complicated logistics of distributing temperature-sensitive pharmaceuticals. This part of the supply chain requires detailed safety and product efficacy assessments at every step. This is one reason why many pharmaceutical companies have been investigating the support that blockchain can provide to their supply chains.
Another factor that may swayed Amazon is the issue of counterfeit medicines, which has become increasingly concerning in terms of the economic cost of the global black market. Any company distributing medicines would need to be very sure of the source in order to safeguard the human life that could stem from a consumer taking counterfeit drugs. This is either through the falsified medicine containing no active ingredients or ingredients that might cause patient harm.
Dietary supplement pills
Dietary supplement pills
A report by CNBC adds that Amazon has also learned that hospitals are not enthusiastic about changing their traditional purchasing process in terms of leaving current distributors and gravitating towards Amazon.
In place of its major bulk pharmaceutical distribution idea, Amazon has said it intends to shift its focus on continuing to sell less critical healthcare supplies (the company already sells glucometers, gloves and stethoscopes to medical clinics). Here e-commerce could still prove to be disruptive in the healthcare space, since the retailer is still weighing up whether to begin direct-to-consumer pharmaceutical sales.
This follows Amazon ramping up its hiring of healthcare experts and engaging in consultation with dozens of people about a potential move into the pharmacy market.
In a sign of market trepidation about Amazon’s consideration of bulk pharmaceutical sales, following the news that the retailer was now not minded to enter this sphere, shares in companies that operate within the pharmaceutical supply chain, plus drug price negotiators, rose sharply following the release of the news. This included Cardinal Health, CVS, McKesson and Walgreens.
Meanwhile, Amazon continues to examine alternative healthcare projects via different groups within the company, including the team around Alexa and the somewhat secretive Grand Challenge team (also called the "1492.")
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