WASHINGTON: Amazon set its sights on the pharmacy market Thursday with the acquisition of tech-focused retailer PillPack, sending shock waves through the sector over prospects of disruption by the US online colossus.
Amazon has long been rumored to be interested in the pharmacy business, and the entry by a powerful new player could unsettle a business dominated by large American chains including CVS and Walgreens.
Terms were not disclosed on the deal for PillPack, an online pharmacy which operates in all 50 US states and offers pre-sorted dose packaging and home delivery. Some media reports said Amazon paid $1 billion and outbid rival retail giant Walmart.
“PillPack’s visionary team has a combination of deep pharmacy experience and a focus on technology,” said Jeff Wilke, head of Amazon Worldwide Consumer, in a statement.
“We want to help them continue making it easy for people to save time, simplify their lives, and feel healthier.”
CVS shares slid 6.1 percent in closing trading on the news, while Walgreens Boots Alliance slumped 9.9 percent.
Neil Saunders of the research firm GlobalData Retail called the Amazon acquisition “a warning shot” for the pharmacy sector.