Last week, Amazon launched its own online pharmacy – Amazon Pharmacy – to provide door-to-door delivery of prescription medications and refills in select areas. Prime members receive unlimited, free two-day delivery of prescriptions in discreet packaging. After setting up a secure patient profile through the Amazon App, customers can add insurance information, manage prescriptions and payment options. Through the Amazon Pharmacy program, members can price prescriptions (generic and brand name) with and without insurance and with their co-pay to determine the most affordable option.

In addition, Amazon announced that customers paying for prescriptions without insurance can save up to 80% off generic and 40% off brand name medications at Amazon Pharmacy and at more than 50,000 other participating pharmacies across the country. The Prime prescription savings benefit, available through Inside Rx, LLC, cannot be combined with other offers and is not considered insurance. Prime members and one other adult member of their household can access the prescription savings benefit. Limitations may apply for patients covered under Medicare, Medicaid or Tricare.

Prescriptions must be authorized by a licensed health care provider. Schedule II controlled medications, including most opioids, are not part of the program. Other categories not available through Amazon Pharmacy include compounded medications, pet prescriptions, vaccines, vitamins, over-the-counter items, diabetic testing and administration supplies, medical devices, suspensions, and specialty medications.

Amazon recommends that customers who have an urgent need for medication, like antibiotics, go through their regular pharmacy for faster turnaround. Currently, 30-day supplies of approved medications are available, but 90-day supplies and automatic refills are not. A separate program – PillPack – has been available through Amazon for more than six years. It provides packs of daily medications for patients with chronic conditions.

Customers first

“We designed Amazon Pharmacy to put customers first – bringing Amazon’s customer obsession to an industry that can be inconvenient and confusing,” said TJ Parker, vice president of Amazon Pharmacy, in a November 17, 2020 news release. “We work hard behind the scenes to handle complications seamlessly so anyone who needs a prescription can understand their options, place their order for the lowest available price, and have their medication delivered quickly.”

Doug Herrington, senior vice president of North American Consumer at Amazon, also commented on the new Amazon Pharmacy program.

“As more and more people look to complete everyday errands from home, pharmacy is an important and needed addition to the Amazon online store,” said Herrington. “PillPack has provided exceptional pharmacy service for individuals with chronic health conditions for over six years. Now, we’re expanding our pharmacy offering to Amazon.com, which will help more customers save time, save money, simplify their lives, and feel healthier.”

Access to affordable medication

Jamil Ghani, vice president of Amazon Prime, said, “We understand the importance of access to affordable medication, and we believe Prime members will find tremendous value with the new Amazon Prime prescription savings benefit. Our goal is for Prime to make members’ lives easier and more convenient every day, and we’re excited to extend the incredible savings, seamless shopping experience, and fast, free delivery members know and love with Prime to Amazon Pharmacy.”

Insider Take

Amazon Pharmacy creates some additional competition between Amazon and big box retailers like Walmart and Target, as well as drug store chains like Walgreens and Rite Aid. From a customer standpoint, especially during a pandemic, the convenience of ordering prescriptions through Amazon – especially with significant discounts – is very attractive.

There are caveats like no automatic refills, of course, but some of those features are likely to be adapted as the program matures. From a Prime member standpoint, this is just one of many benefits Amazon offers its Prime members that give the ecommerce giant staying power. Provided the program is well executed and doesn’t create unforeseen problems, this new business segment could be a great strategy for Amazon.