Initially Walmart made an offer to PillPack around $700 million but this was delayed over regulatory concerns, according to CNBC. As a result, Walmart’s stock lost about $3 billion in value as soon as it became clear that Amazon was to buy the online pharmacy start-up.
PillPack is an online pharmacy offering a modern technology-based system that helps people take timely medication. The company, founded in 2013, is based in Boston, Massachusetts, U.S. PillPack sorts, fill, and delivers medications in personalized packets based on when patients need to take them.
PillPack was founded by CEO TJ Parker, aged 32 and Elliot Cohen, Chief Product Officer, aged 35. The two have apparently received $1 billion in cash for their company as a result of the Amazon purchase. Explaining his company’s success model, Parker explained succinctly: “PillPack makes it simple for any customer to take the right medication at the right time, and feel healthier.”
The move is a signal that Amazon aims to achieve a more direct and more commercial role in the world of healthcare in the coming years. This follows on from Amazon, BerkshireHathaway and JPMorgan Chase coming together to establish a yet-unamed healthcare company, which will be headed by Dr Atul Gawande.
Neil Saunders, managing director of GlobalData Retail, told the BBC that Amazon’s entry into the drug distribution arena is “a warning shot in what is about to become a major battle within the pharmacy space.”
