Amazon, a mega-giant in the retail world, has moved into the healthcare arena. Unfortunately for the organization, not every decision Amazon makes regarding this highly regulated industry is successful. The most recent example is the fact that the organization stepped back from its telehealth venture at the end of 2022 amid concerns the company was unable to give patients the care they deserved. Fortunately for everyone else, particularly leaders in healthcare industries like pharmacies, Amazon’s errors provide a slew of learning opportunities.
Amazon’s response to these failures
As the saying goes, if at first you don’t succeed, try again.
And try they will.
This is, arguably, the first lesson leaders in healthcare can learn from Amazon’s failures. Failures happen. Take steps to mitigate the risk and help better ensure your organization can bounce back and keep on trying.
A review of the timeline of Amazon’s foray into healthcare
These lessons may be best learned by looking at Amazon’s efforts to find success within the healthcare marketplace. The review feels akin to a ride on a rollercoaster. Some highlights include:
- Up in 2018. Acquire PillPack, an established online pharmacy operation.
- Up again in 2019. You can almost hear the wheels pulling the rollercoaster car up the peak as Amazon launches Amazon Care, a telehealth service that offered primary and urgent care services.
- And some more in 2020. Amazon launches its own online pharmacy, Amazon Pharmacy, moving that rollercoaster car further up the track. Amazon Pharmacy is set up as a service that can ship medications to patients after their physicians send in prescriptions.
- Down in 2021. The car starts a slow downward progression as Amazon abandons healthcare deal with JPMorgan Chase and Berkshire Hathaway to start their own healthcare company.
- Down again 2022. And, as in any good rollercoaster ride, the car takes a surprising and steep drop when Amazon suddenly steps away from its telehealth program (noted above).
- Starting up again in 2023. Amazon announces RxPass, an online format that allows those who subscribe to buy qualifying generic prescriptions at a set rate. If this sounds familiar it is, WalMart and Mark Cuban’s popular Cost Plus Drug Company have similar models. It could symbolize another ride up the rollercoaster that is common when navigating the healthcare marketplace.
This move into the prescription space is marked with other attempts to enter the healthcare marketplace. Although Amazon is navigating what appears to be the entire healthcare marketplace, there are some important lessons that deal specifically with those looking to buy or merge pharmaceutical practices.
Three lessons for pharmacy owners from the Amazon example
The first lesson, noted above is the importance of due diligence and avoiding a risky business decision while also including as many safety nets as possible so your business can bounce back if a deal fails.
Next, know that it takes time to navigate these deals. The timeline above is just a brief glance at the overall evolution of Amazon’s entrance into healthcare. This need to evolve is something that is common in any successful business and pharmacies are no different in this respect. Having some flexibility to evolve as the marketplace changes can help pharmacy owners navigate those dips in the rollercoaster and come out on top.
Finally, it may take more than one deal to find the right combination for success. Perhaps your pharmacy merges with another and then realizes it needs more representation within the tech industry. Queue another potential acquisition of a tech company to provide that online presence. Do not be afraid to consider various mergers to fill your goals for your pharmacy’s future.
Attorney John Rivas is responsible for this communication