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E-Commerce Giant Amazon Launches Online Pharmacy

E-commerce giant takes on Traditional Pharmacies by selling prescription medicines


on Inc. has added a pharmacy counter to its virtual store. This was  a long-anticipated move to push deeper into health care and has sent shares of traditional drugstores tumbling.

The decision by Amazon to start selling prescription medicines comes about two years after the company acquired online pharmacy PillPack Inc., and it coincides with the Covid-19 pandemic, which has seen more consumers resorting to online ordering as they venture out less.

The e-commerce giant’s advance into the pharmacy business will again test its ability to crack a market where national chains and big insurance companies often control how drugs are dispensed. Amazon plans to use the convenience of its Prime shipping program to win over patients accustomed to trips to nearby pharmacists.

Various traditional pharmacies have been bracing for this moment, rolling out their own same-day delivery or expanding into medical services. But investors fear the drugstore chains might suffer the same fate that befell traditional bookstores or toy shops after Amazon encroached on their turf.

Shares of traditional pharmacies in the US such as CVS dropped 8.6% and Walgreens shed 9.6% on Tuesday, erasing $12 billion in market value. Smaller rival Rite Aid Corp. was off 16%. Those companies, plus Walmart Inc., account for the much of the 3.8 billion prescriptions filled each year in the U.S.

This trend will soon be mirrored in South Africa as the world moves to the digital space at a much faster rate due to the Covid-19 pandemic.


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