As brick-and-mortar drugstores struggle, Amazon doubles down on revamping the pharmacy experience

LAS VEGAS—Amazon is betting big on its pharmacy arm, with the retail giant aiming to bring its focus on ease of use for consumers to the prescription drug space.

The company first unveiled Amazon Pharmacy in late 2020 on the heels of its 2018 acquisition of online pharmacy PillPack. John Love, president of Amazon Pharmacy, told Fierce Healthcare in an interview at AHIP last month that its home delivery model is centered around addressing access and affordability in tandem.

When it launched, Amazon Pharmacy initially focused on mostly medications for chronic conditions, aligning with PillPack's strengths. It has since expanded that scope as it invests in physical sites and new capabilities around logistics.

"Fundamentally, what we think is the fact that our pharmacy is digital-forward so people can access it 24/7," Love said. "The pharmacy's in your pocket—which, in particular as pharmacy deserts grow, as hours are constrained and people's time is at more of a premium, that's convenient."

"We use technology at Amazon to make things simpler," he added.

Amazon's pharmacy push comes as traditional brick-and-mortar stores have faced some notable hurdles. Walgreens, for example, hosted its third-quarter earnings last week and said it would continue to close stores as a "challenging" environment puts pressure on its profits.

An example of this simplicity at work is Amazon's RxPass program, which it launched in January 2023. Under this model, people can secure unlimited access to 60 generic medications shipped to their door at a $5 monthly fee. 

The program also allows users to connect with a pharmacist around the clock. 

Love said the Amazon Pharmacy team works with pharmaceutical companies on manufacturer coupons, which members frequently do not take advantage of. That dovetails with the team's focus on transparency and providing prices upfront, which he said is already paying off.

"What we found, which was remarkable, is without changing any of the prices people paid, just showing them the price upfront of the copay on branded med, it improved adherence," he said. "So we saw more customers engaging."

Part of what makes this work is that Amazon as a retailer is built on convenience and ease of use. So customers coming to the pharmacy division expect that same experience.

Love said that prescriptions are often a "grudge purchase" for patients, as they don't know if they're about to find a $0 copayment or a bill that costs them hundreds.

"The feedback that we get, what people love and what they want more of, is just that simplicity and clarity," Love said.

Love said the team is hearing anecdotally from patients that knowing they can secure their key medications at a low, predictable price is encouraging them to "be more proactive about health." He said Amazon Pharmacy is still in early days on the quickest turnarounds for deliveries, including cases where patients can receive their medications within minutes of returning home from a doctor's visit, but those have also seen a warm reception.

"Those experiences don't really exist frequently in healthcare for folks," Love said, "and so that's more of what we're excited about."