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Amazon looks set to enter pharmacy market

Seeking a new pharmacy model — to offer legitimate medicines by online ordering — Amazon appears set to enter the world of pharmaceutical products distribution. This is a lucrative world, as The Wall Street Journal points out, with a market worth some $412 billion in the U.S. alone.

The latest news comes via the St. Louis Post-Dispatch, which has come across information about Amazon’s new business venture. This is based on a review of public records, which indicate that the pioneering e-commerce site has been issued licenses that will allow it to become a wholesale drug distributor in 12 U.S. states. These states are: Nevada, Arizona, North Dakota, Louisiana, Alabama, New Jersey, Michigan, Connecticut, Idaho, New Hampshire, Oregon and Tennessee.

Amazon itself has made no statement about its move into medicines. It could be that the licensing is part of a much longer-term strategy and that no immediate changes will be apparent, or it could be that Amazon has entered into agreement with one or more pharmaceutical companies to act as a drugs distributor.

In terms of what the impact will be, the news is unlikely to be positive for established pharmacies and Engadget reports that the stock price of several pharmacies have fallen in anticipation of Amazon’s new venture. How these pharmacies respond the disruption will be interesting and the outcome of this process is likely to see a shift in how consumers access non-prescription medications.

According to Linda Pissott Reig, who co-chairs the Food and Drug section of the Pittsburgh-based law firm Buchanan, Ingersoll & Rooney PC: “Amazon has shown that they have mastery of the technology and innovative approaches to really transform how the marketplace delivers product.”

This application of technology could see Amazon harness big data analytics to, for example, market an anti-depressant medication at a consumer who has recently purchased a book on the subject. This would make Amazon a major player in the medicines market. In terms of obstacles the main one is the tight regulation of medicines supply in many countries, including the U.S. where the Food and Drug Administration sets tight rules on both marketing and sale.

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Written By

Dr. Tim Sandle is Digital Journal's Editor-at-Large for science news. Tim specializes in science, technology, environmental, business, and health journalism. He is additionally a practising microbiologist; and an author. He is also interested in history, politics and current affairs.

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