NASHVILLE, Tennessee—Amazon rolled out a new feature to automatically apply drug manufacturer-sponsored coupons directly when consumers order brand-name medications through the online pharmacy.
Amazon Pharmacy is working with GSK, Kaléo, Novo Nordisk and Dexcom to integrate coupons for their branded medications—including Trelegy, AUVI-Q, Wegovy and G6/G7 sensors and transmitters, respectively—directly into the checkout experience on its website and app.
Amazon has been focused on ways to make prescription drugs more affordable for consumers as it works to carve out a piece of the retail pharmacy market. Its latest move puts pressure on drug discount platforms like GoodRx.
Amazon Pharmacy plans to work with manufacturers to add more coupon selections over time, the company said.
To reduce out-of-pocket costs, some drug manufacturers offer coupons for their brand-name medications. But these discounts and coupons can be hard to find and often require clipping, clicking and downloading. Consumers often face a tedious process that involves searching online, downloading forms, enrolling in a program or having to call the drug manufacturer directly. One study found patients only used manufacturer-sponsored coupons 15% of the time they were available to them.
"Coupons have existed for a very long time. This is not us inventing coupons. Manufacturers have had this out in the ecosystem for a while. I'll put on my provider hat—tools exist in healthcare, but the challenge often is knowing what exists and how to access it and to apply it," Vin Gupta, M.D., Amazon Pharmacy's chief medical officer, said in an interview.
"Without any thought or administrative burden, if somebody has a prescription for one of our included medications, it will be automatically applied during checkout. We're removing the onus on the patient to figure out whether some of these tools exist to actually make the medications cheaper," Gupta noted. "This can really can help bring down the price point of branded pharmaceuticals that often are inaccessible to the people who need them the most."
Through Amazon Pharmacy, coupons can be applied to brand-name therapies for the treatment of diabetes, asthma, emphysema, obesity and other conditions.
As a pulmonologist, Gupta says he understands the impact of drug prices on patients' ability to adhere to treatment. When the medication prescribed is too expensive, the provider has to pivot to a more affordable alternative. "Having that discussion at the point of prescription is useful and time efficient for the patient [and] doubles as also being really helpful for the provider. I think that really helps enable that therapeutic relationship to prosper, but also just streamlines that patient care experience," he said.
He added, "Coupons on Amazon pharmacy is an incremental step on what we've been building over the last, now almost four years, where it's leaning into services that we think can really streamline the patient experience and help providers in the process. Convenience is going to help the patient activation and engagement, which will ultimately help with adherence, and then think, over time, improve outcomes."
Amazon shook up the retail drugstore market when it acquired PillPack in 2018 and then again when it rolled out Amazon Pharmacy in 2020. The online retail giant has been rapidly expanding its reach in the healthcare space, most notably with its recent acquisition of One Medical for $3.9 billion.
Gupta declined to disclose how many consumers are using Amazon Pharmacy but said the "value proposition of the service is resonating with patients."
"We're beyond where we expected it to be in terms of new patients to our business," he said.
Competition in the pharmacy space is heating up as online pharmacies that offer price transparency and mail-order services are putting pressure on brick-and-mortar retail pharmacies. Mark Cuban Cost Plus Drug Company launched an online pharmacy earlier this year, aiming to disrupt skyrocketing prescription drug prices in the U.S. It currently offers approximately 350 unique generic prescription drugs that it says reflect manufacturer prices plus a 15% fee.
Amazon offers a prescription savings benefit for Prime members, Prime Rx, that enables discounts of up to 80% off generic and 40% off brand-name medications at more than 60,000 participating pharmacies nationwide, when paying without insurance.
A year ago, at ViVE 2022, the online retailer signaled it was expanding its drug discount reach when it unveiled the built-in MedsYourWay prescription discount card, administered by Inside Rx, which is available to Blue Cross Blue Shield (BCBS) health plans in states like New Jersey, Nebraska, Alabama, Florida, North Carolina, Minnesota, North Dakota and Kansas.
Back in January, Amazon rolled out a new prescription drug subscription for Prime members called RxPass that will ship generic medications to customers' homes for a flat monthly fee of $5.
Gupta says Amazon Pharmacy provides a high-touch service by connecting patients 24/7 with a pharmacist combined with its advanced logistics network for free shipping.
"Amazon Pharmacy exists because this area is ripe for reinvention, convenience and affordability," he said. "We love that there are other stakeholders co-creating in the space as well. I think it's forcing the entire industry to rethink what patients deserve and where they should get their care. We're really leaning into price transparency, delivery by a promised time, the features that you expect to get when you go to Amazon.com make so much sense in the pharmacy experience."