Dr. Alexa? How Amazon could reshape health care
It may be planning to deliver prescriptions
The online giant has reportedly received approval for wholesale pharmacy licenses in at least 12 states.
SAN FRANCISCO – Paging Dr.
Alexa?
As the U.S. health care industry shifts, Amazon is quietly moving in directions that suggest the company may be planning to deliver prescriptions, not just books, clothes and other merchandise.
“It’s entirely likely Amazon will play a role in health care. They’re a company that’s been very disruptive to multiple industries,” said Wendell Potter, a health care industry critic. “I bet you they’ve been looking at health care for some time — there are opportunities there for them.”
Speculation has intensified after the St. Louis Post-Dispatch reported Thursday that Amazon has received approval for wholesale pharmacy licenses in at least 12 states.
Amazon declined to comment on the report.
Experts and analysts say they can easily see a place for an “Amazon-like company” in the health care market.
“A lot of (health care) companies are already looking to see what they can learn from Amazon,” said Marcus Ehrhardt, partner of consulting firm PwC’s pharma and life sciences division.
Could U.S. consumers one day find themselves logging in to Amazon Healthcare Prime, or asking Dr. Alexa — Amazon’s popular Echo home assistance device uses a digital voice answering to the name Alexa — what they should do about their cough?
The licenses Amazon has so far sought are far from what’s needed to begin shipping drugs to consumers. They give it the ability to sell medical professional-use-only products such as sutures, ultrasound gel and syringes for use in medical and dental offices or hospitals, the company said.
Delivering prescription drugs might seem like simply a transportation issue, but it’s not. Neither Amazon nor any other online seller can just put drugs next to toys, books and household staples in its warehouses and ship them all
in the same box to homes because of complex, state-based regulations around prescriptions, said Ehrhardt.
But Amazon does have expertise that makes it a natural candidate to look for ideas that would reform the U.S. health care industry as it tries to control costs, said Gil Irwin, PwC deals partner.
Seattle-based Amazon excels at analyzing enormous amounts of data and then knowing how to use it to motivate customers, he notes.
Amazon, for example, might see that a customer has bought cough drops every week for the last month and went to the doctor for a cold six weeks before but never filled his prescription.
Amazon, or “an Amazon-like company,” could use that kind of insight to encourage consumers to go back to the doctor or drop by a nearby clinic for a nurse practitioner to examine them, Irwin said. “That could help solve the problem of getting the wrong care,” and overall lower expenses.
Potter, who recently launched Tarbell.com, a site that focuses on corporate influence over health care, can see a role for Amazon’s digital assistant Alexa. His first job in health care was setting up a hotline for a hospital so patients could talk to a nurse about their symptoms and get advice on what to do.
“Why can’t Alexa do that?” Potter asked.
The missing link for Amazon now is doctors and prescribers, both of which represent huge regulatory and logistical hurdles.
But it’s also got some interesting synergies, given the company’s newly acquired network of brick and mortar Whole Foods stores. It’s also got dozens of fulfillment centers nationwide that each support hundreds of workers, who might benefit from in-house clinics.
All of which is “wild speculation,” said Sucharita Mulpuru, an Amazon analyst with Forrester. “The medical world is still highly fragmented and it won’t be a trivial task to tackle this, but that’s not to say it won’t happen.”