Amazon’s online pharmacy shakes up another industry

NEW YORK — Now at Amazon.com: insulin and inhalers.

The retail colossus opened an online pharmacy Tuesday that allows customers to order medication or prescription refills and have them delivered to their front door in a couple of days.

The potential impact of Amazon’s arrival in the pharmaceutical space rippled through that sector immediately. The stocks of north suburban-based Walgreens, CVS Health Corp. and Rite Aid all tumbled Tuesday.

The big chains rely on their pharmacies for a steady flow of shoppers. All have upped online services and touted their abilities to deliver prescriptions and other goods as the COVID-19 pandemic has pushed more consumers to stay home. But Amazon.com has mastered these things, and its online store is infinitely larger, with millions of loyal shoppers.

“The news represents a disruption to the system and competitive threat that will likely shift scripts away from the retail channel,” analysts at Citi Research said in a note.

The company said its pharmacy will offer commonly prescribed medications in the U.S., including creams and pills, as well as medications that need to stay refrigerated, like insulin. Shoppers have to set up a profile on Amazon’s website and have their doctors send prescriptions there. It won’t ship medications that have a high risk of being abused, like some opioids.

Most insurance is accepted, Amazon said. But Prime members who don’t have insurance can also buy generic or brand-name drugs from Amazon for a discount.

Health economist Craig Garthwaite sees several reasons Amazon may become an attractive option for patients. The retailer may be able to make price shopping for prescriptions more pleasant, and it might be competitive on the pricing of generic drugs, said Garthwaite, who teaches at Northwestern University’s Kellogg School of Management.