PillPack is applying for licenses as Amazon expands pharmacy business


Amazon bought PillPack, an internet pharmacy start-up, earlier this year, leading to speculation that the e-retailer will soon start selling prescription drugs on its marketplace.

Before that happens, Amazon may be preparing to provide the service to its own employees.

PillPack recently applied for a string of new pharmacy licenses, primarily to ship drugs to customers from its Phoenix facility. The licenses in Washington, New Mexico and Indiana were spotted this week by analysts at financial services firm Jefferies.

In a report to clients on Monday, the analysts said it appears that the licenses would allow PillPack to ship to those states from Phoenix. Previously, Jefferies noted that PillPack’s facility in Phoenix was only licensed to ship to Arizona and New Hampshire, where it’s headquartered. The company has been applying for more licenses in the past few months.

Customers in every U.S. state except Hawaii can already receive PillPack shipments, but they only get delivered from a handful of facilities. With more licenses in Phoenix, the company potentially gets faster access to people in Western states.

It’s particularly notable that PillPack is targeting Washington, because that would mean gaining access to employees at Amazon’s Seattle headquarters. Amazon has used a similar company-first strategy in other areas, including through its health joint venture with Berkshire Hathaway and J.P. Morgan Chase, where it’s first focusing on its own workers.

“This move wouldn’t be unusual for AMZN as the company often pilots new product offerings (Amazon Locker, Amazon Go cashier-less stores) for its own employees and/or in geographies with higher employee concentrations like Seattle prior to a national rollout,” the Jefferies analysts wrote.

Amazon offers a very large testing ground. The company has hundreds of thousands of employees and has plans to add a combined 50,000 jobs at its two new headquarters offices, in New York City and the suburbs of Washington, D.C.

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