Bloomberg has a story about how Amazon's entry into the pharmacy business has not been smooth, despite its $753 million acquisition of mail order business PillPack, which sells packaged, presorted medicines.
PillPack, the story says, "has run into stiff opposition, from chains like CVS with thousands of stores to family-owned operations with a single shop. Having seen their business of selling shampoo and razor blades chipped away by online sellers, the drugstores are trying to keep Amazon from wresting away their piece of the $333 billion U.S. prescription-drug industry."
One of the ways that companies are fighting back against Amazon and PillPack is by insisting - not unreasonably, some would argue - on patient confirmations of prescription transfers to the PillPack system.
Here's how Bloomberg frames the story:
"When PillPack was new, there was rarely a problem getting prescriptions transferred, according to interviews with three former PillPack pharmacy technicians, who requested anonymity to discuss sensitive information. But once it hit the radar screen of the big chains, transfers became harder as drugstores increasingly insisted on direct confirmation from the patients, they said.
"Patients who take multiple medicines are a huge and lucrative market because pharmacies are typically paid a fee or markup on each prescription. An estimated 23.1% of the U.S. population — more than 70 million people — takes three or more prescription drugs per month, and 11.9% take five or more drugs each month, according to the U.S. Centers for Disease Control and Prevention.
"Those are the users PillPack wants, but they’re also customers that CVS Health Corp., Walgreens Boots Alliance Inc. and Rite Aid Corp. want to keep. And the chains, which together operate more than 20,000 drugstores in the U.S., aren’t giving in without a fight."
The story goes on: "CVS and other drugstores say any delays in the process are because they’re trying to make sure their customers are aware that they had agreed to have their prescriptions transferred. PillPack, on the other hand, maintains that it always gets consent and that the chains are purposely stonewalling to hang on to an outdated, inefficient retail model.
"PillPack is aggressively trying to work around any stall tactics. Its workers are following up faxed transfer requests with phone calls to make sure they aren’t ignored. They are increasingly contacting patients' doctors to write new prescriptions as an alternative to getting existing ones transferred. And the company is carefully tracking pharmacies that it believes have been uncooperative. While laws vary, states generally require pharmacies to fulfill valid prescription-transfer requests."
PillPack is said to be growing "steadily since joining the Amazon stable," and is currently "exploring deals with health plans and insurers."
PillPack, the story says, "has run into stiff opposition, from chains like CVS with thousands of stores to family-owned operations with a single shop. Having seen their business of selling shampoo and razor blades chipped away by online sellers, the drugstores are trying to keep Amazon from wresting away their piece of the $333 billion U.S. prescription-drug industry."
One of the ways that companies are fighting back against Amazon and PillPack is by insisting - not unreasonably, some would argue - on patient confirmations of prescription transfers to the PillPack system.
Here's how Bloomberg frames the story:
"When PillPack was new, there was rarely a problem getting prescriptions transferred, according to interviews with three former PillPack pharmacy technicians, who requested anonymity to discuss sensitive information. But once it hit the radar screen of the big chains, transfers became harder as drugstores increasingly insisted on direct confirmation from the patients, they said.
"Patients who take multiple medicines are a huge and lucrative market because pharmacies are typically paid a fee or markup on each prescription. An estimated 23.1% of the U.S. population — more than 70 million people — takes three or more prescription drugs per month, and 11.9% take five or more drugs each month, according to the U.S. Centers for Disease Control and Prevention.
"Those are the users PillPack wants, but they’re also customers that CVS Health Corp., Walgreens Boots Alliance Inc. and Rite Aid Corp. want to keep. And the chains, which together operate more than 20,000 drugstores in the U.S., aren’t giving in without a fight."
The story goes on: "CVS and other drugstores say any delays in the process are because they’re trying to make sure their customers are aware that they had agreed to have their prescriptions transferred. PillPack, on the other hand, maintains that it always gets consent and that the chains are purposely stonewalling to hang on to an outdated, inefficient retail model.
"PillPack is aggressively trying to work around any stall tactics. Its workers are following up faxed transfer requests with phone calls to make sure they aren’t ignored. They are increasingly contacting patients' doctors to write new prescriptions as an alternative to getting existing ones transferred. And the company is carefully tracking pharmacies that it believes have been uncooperative. While laws vary, states generally require pharmacies to fulfill valid prescription-transfer requests."
PillPack is said to be growing "steadily since joining the Amazon stable," and is currently "exploring deals with health plans and insurers."
- KC's View:
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As a patient, I think that my highest priority would be doing business with companies that have my best interests at heart. I'm a little surprised that rather than slow-walking these transfers, companies like CVS have not looked for a compelling competitive response to the PillPack business model.
Just offering resistance in this case won't be enough, I suspect.
