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Amazon could start selling drugs when PillPack deal closes in 2018

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When Amazon bought Whole Foods, shoppers were able to access discounts the day the deal closed. It all started with a few items, but expanded to a much broader array of groceries.

Some experts believe Amazon will take a similar approach with prescription medicines to show value right off the bat. The companies said the deal would close in the second half of the year, which means it could happen any time.

“Amazon could rename PillPack as ‘Amazon Pharmacy,’ and start right away,” said Talha Sattar, CEO of internet pharmacy start-up Nimble. “The bigger question is about the form that the offering will take.”

Amazon could start by targeting those who pay cash for their meds, either for generic drugs or branded drugs with coupons from companies like GoodRx.

“Day 1, Amazon will likely focus on cash purchases of both generic and brand medicines — all they need to do so is [get] a board of pharmacy license in all 50 states, and dispensing capacity,” said Jonathan Schwartz, CEO of another internet pharmacy start-up, CareZone.

That’s a chunk of a $450 billion market, or about 6 percent of the U.S. population, which includes the noninsured and those with high-deductible plans. It also doesn’t require working with the largest pharmacy benefits managers, like Express Scripts, which are gatekeepers of sorts for those who opt to use their health insurance.

Amazon’s biggest rival, Walmart, already offers a service like this. It’s essentially a list of generic medicines with a $4 price for 30-day prescriptions — no insurance required. Some experts believe Amazon could do its own version of this quickly, and with even lower prices to attract users away from its competitor.

“A company like Amazon could capture $10 [billion] or $20 billion in revenue by doing that well,” said Sattar.

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