In a statement, PillPack CEO and Co-Founder TJ Parker said the company, together with Amazon, plans to "continue working with partners across the healthcare industry to help people throughout the USA who can benefit from a better pharmacy experience".
Founded in 2013, Boston-based PillPack is an online pharmacy that ships pre-packaged doses of medication straight to customers' doors.
Amazon's acquisition of PillPack follows a larger-though less defined-move into the healthcare sector for the online giant.
Amazon is pushing further into pharmacy with a deal to acquire prescription-management service PillPack. Shares of drug wholesalers Mckesson Corp, Cardinal Health and AmerisourceBergen were also down.
The transaction is expected to close during the second half of 2018. CVS is buying insurer Aetna for while Cigna, another insurer, is scooping up pharmacy benefits manager Express Scripts. A person who takes five different medications each morning, for example, could receive a packet with all the pills in a single pouch, instead of having to manually sort the doses into pill boxes for each day. In January, the company announced a collaboration with JPMorgan and Berkshire Hathaway meant to reduce healthcare costs for U.S. workers. Those ties will give Amazon access to much of the prescription drug market in the U.S.
PillPack, which is closely held, also has software that automates many routine pharmacy tasks, such as verifying when a refill is due, determining co-pays, and confirming insurance.
Some analysts played down the immediate threat Amazon poses. And what's notable about this particular case is the outsized degree of the market cap erased, relative to the price Amazon paid for PillPack. "And I think that that's more likely than not what you're going to see today"'.
These and other health care stocks rose a few months ago after reports that Amazon may not have been interested in selling prescription drugs. It counts Accel Partners, Atlas Venture, CRV, Founder Collective, Menlo Ventures, Sherpa Ventures, Techstars among its investors. Pessina insisted that physical pharmacies would continue to be "very important". Both deals are valued at almost $70 billion.