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Amazon’s entry into the pharmaceuticals industry is bound to bring change to the market as competition forces pharmaceutical providers to innovate in the space. But what is amazon pharmacy offering and what is it all about? In this blog we will delve into the ethical and technical applications of this Amazon venture.
There are few pies in which online giant Amazon does not yet have its fingers. However, in 2019 it grew further by becoming an online pharmacy. Amazon Prime members are eligible for free two-day delivery and discounts of up to 80% on generic medicines and 40% on prescribed brand-name drugs. Using Amazon, customers need to provide some basic health information, such as whether they are pregnant, as well as date of birth, gender and insurance details.
After launching its own line of over-the-counter drugs in 2019, this is arguably Amazon’s broadest push into the healthcare business to-date, one that could open very large, new revenue opportunities for the company, especially as the ongoing COVID-19 pandemic pushes consumers both toward more remote care and using online channels for all their shopping needs.
As it stands, Amazon pharmacy is only available to customers in the United States however it is really a global opportunity for the e-commerce giant. In January of 2020 Amazon has filed for an “Amazon Pharmacy’” trademark in the UK, Canada and Australia. All indicators point to Amazon entering the UK market, but it is just a matter of time.
In the United States, the way in which the drugs industry is built gives pharmaceutical companies full autonomy over the price of medication. This ultimately leads to high pricing strategies amongst the firms. Amazons entry to the market threatens to undercut these firms by offering discounted pricing as mentioned above at almost 80% cheaper at times – facilitating wider consumer choice in a multi-billion-dollar industry.
However, in the UK the price of medication is regulated so there will be a less volatile interaction between Amazon and existing online medication suppliers. The competition will be focused more so on logistics and convenience – where amazon has a proven track record of excelling in this domain.
UK online pharmacy businesses are worried from the threat of Amazons huge marketing budget on their market function. Fearing that Amazon will take a considerable chunk of the market share from each existing company.
As it stands there is no clear timeline for Amazon expanding its online pharmacy services outside of the US just yet. However as the global pandemic forces consumers hands to telehealth and its consortium it appears Amazons entry is imminent.