• C.E.K. & Partners

How Will Amazon’s PillPack Affect Healthcare?



Image of pills is from AMA blog post!

It’s no secret many people believe today’s healthcare system holds significant opportunity for improvement, whether around it is rising costs or putting people at the center of care. Recent announcements that are disrupting its current state include the formation of a healthcare company by Jeff Bezos, CEO of Amazon, along with JP Morgan and Warren Buffet’s Berkshire Hathaway, and most recently, Amazon’s $1 billion acquisition of PillPack.

As our on-demand lives get busier, people want convenience, and a growing list of brands and services are offering it. Amazon, Walmart and a slew of other companies with a strong online presence have made ordering and receiving everyday essentials easier with subscription-based deliveries, from clothes to meal-prep kits, packaged, organized and delivered based on our personal preferences. Our medicines can be automatically refilled using online services now, too, and PillPack offers this along with the convenience of personalization to which we’ve become accustomed.

When it comes to pills, it’s an exciting proposition—especially for those of us who have to take daily doses to address chronic health conditions. If you’re one of millions taking medicine daily, you can probably remember a time when you couldn’t recall whether or not you took your designated dose of meds or supplements. PillPack wants to help with that; their value proposition is “Your medication, made easy.” PillPack describes its company as a “a full-service pharmacy that sorts your medication by the dose and delivers to your door.” If you aren’t familiar with their model, it means that instead of bottles of multiple pills, a pharmacist creates small packets with your different doses for each distinct time of day. What’s not to love about an easy way to stay on top of the different pills you or a loved one take?

While it is too early to know how PillPack will actually affect the ecosystem of pharmacies and healthcare providers, consumers and caregivers, below is our take on how it just might. It includes a perspective from Tim Gentilcore, director of retail pharmacy at Mission Health & Healthy State. It also includes high-level implications for your organization as a brand.

Healthcare Providers

For healthcare providers, it seems like PillPack will have a positive impact since it could translate to increased compliance (aka medication adherence) in taking medicine correctly. Better compliance should lead to better outcomes and general health of individuals undergoing treatments. This is especially the case with those managing chronic conditions such as diabetes. Looking deeper, in a discussion with Gentilcore he told us, “What community providers and pharmacists are seeking is bidirectional transparency to better counsel patients on their prescriptions. Providers would like to see their patient’s entire prescription profile, and in turn, pharmacists would like to see the corresponding medical data. PillPack offers a potentially great proposition and one that may further support the important continuum of care. However, there still remains an opportunity for a brand to reconcile providers’—doctors’ and pharmacists’—need of access to an individual’s comprehensive medical record to support the best care possible.”

Brand Implication: How can your practice or health plan innovate to improve on the customer/patient experience while supporting the continuum of care?

Pharmacies

With the acquisition of PillPack, Amazon seemingly has made it easier to order and manage pills—not to mention eliminate the need to stop at one’s local pharmacy for routine medicine. So it should be no surprise that pharmacies might not be too happy about this acquisition, especially since Amazon’s mobile app is one of the most popular among smart phone users. On the day of the announcement, stocks of top pharmacy chains dropped pretty significantly—some by up to 10%. Gentilcore did remind us, “In addition to the personalized services that local pharmacies offer patients, there will be those instances when patients need to fill a new prescription right away and local pharmacies will remain critical for that need.” However, the local pharmacy does now have competitors bigger than PillPack already disrupting their model. Unfortunately, there’s no reason to think drug prices would be affected.

Brand Implication: eCommerce is growing and disrupting traditional brick-a