
Amazon gains wholesale pharmacy licenses in multiple states - refurb
http://www.stltoday.com/business/local/amazon-gains-wholesale-pharmacy-licenses-in-multiple-states/article_4e77a39f-e644-5c22-b5e6-e613a9ed2512.html
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vthallam
Apparently better for consumers in general now that there's more competition.
One Industry I really really want them to enter is Consumer Airlines. Service
in most airlines sucks, like big time. Can't wait for Amazon Airlines with
Prime Video and Internet available for all.

But of course I know that's a distant dream unless the Prime Air works great.

~~~
aknosis
Isn't Amazon notorious for bad customer service though? That would prevent
them from disputing the industry.

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krrrh
Amazon's customer service to consumers is exceptional, but the service they
give to their merchants is horrible and extremely incompetent.

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javiramos
Yes. Business customer service is terrible.

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refurb
This is going to be interesting. Drug wholesaling is a tough business with
razor thin margins. Wholesalers don't make much off of branded drugs because
the big drug companies have most of the negotiating power. It's not unusual
for their cut to be in the tens of basis points.

They make the most money off of generic drugs and often use arbitrage as a
revenue source when price increases happen. Price increases for generic drugs
have been weak lately and it's hurting them.[1]

[1][http://www.drugchannels.net/2017/09/drug-wholesalers-
struggl...](http://www.drugchannels.net/2017/09/drug-wholesalers-struggle-
slower.html)

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mrep
> razor thin margins

That's everything amazon does besides AWS

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billmalarky
Yeah razor thin margins is barrier to entry that amazon sees as an opportunity
not a threat.

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oh_sigh
Not exactly - Amazon has traditionally entered spaces with...not exactly razor
thing margins, but margins with some wiggle room. Even their grocery play was
on 'higher end' groceries and not a razor thin market like Acme/Shop
Rite/Kroegers.

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billmalarky
They then proceed to wrench out that wiggle room to drive out the established
players and create an impossible barrier to entry.

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arkitaip
Being able to order their medication and have it delivered the same day is
going to be huge for lots of people. Sure, Amazon won't make much money but
add everything else they sell and you have yet another reason why you can stay
in the Amazon eco system for all your shopping needs.

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seibelj
If it takes Amazon to fix American healthcare, god bless them. What a total
cluster fuck healthcare is, and if that’s what they want to fix, I’m very
supportive. Putting $5k into their stock tomorrow

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rorykoehler
Serious question: How is a cut throat capitalist company gaining the ability
to push pills going to fix American healthcare?

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legitster
American healthcare is completely non-competitive. No pricing competition,
high barriers of entry, and completely entrenched players. Any new players
would be a win.

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rorykoehler
The main issue with American healthcare besides the price of drugs, insurance
and care (which Amazon could help solve but is essentially a secondary
conidition) is the philosophy around healthcare in general. It's all reactive.
To solve healthcare America needs a better diet made up of actual food (not
psuedo-food products), more exercise (cities designed for walking and biking
not driving), doctors that aren't incentivized to sell drugs, no drug adverts
etc. Basically to focus on prevention not reaction.

~~~
seibelj
For starters, doctors are in a modern guild system. They artificially limit
the number of medical schools, increasing the salaries of licensed doctors
while limiting the supply. As society ages and needs more medical services,
the poor are continually priced out as the supply of doctors is limited
artificially.

Although extraordinary unpopular if you speak to doctors (as I have found),
drastically increasing the number of doctors would do wonders. I’m sure there
is a percentage (2%?) from poor countries that would pass in America as
average quality.

Next, transparent pricing. Laser eye surgery has radically improved in quality
while decreasing costs because insurance (typically) doesn’t cover it. People
want it, but must pay out of pocket, so they shop around and elect to laser
eye surgery on their own terms. The result is increased quality at lower
prices. Not every medical procedure is this way (such as the emergency room),
but perhaps if I needed a knee replaced, and until I did it I merely walked
with a cane, I might shop around for the best price and value.

Until transparent pricing happens, and the supply of doctors meets demand, we
will simply be passing laws to further warp free market incentives. My hope is
that amazon increases the influence of free market mechanics into this
horrible system.

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exelius
Medicine cannot be managed by capitalism. Elements of the industry can, but
the basic elements of care giving and treatment basically amount to “pay me or
die”. The moral hazard in withholding care from some to be able to raise
prices on others is too great.

Capitalism is great when the incentives line up without creating moral hazard;
which they do in a lot of areas. But we as a society can have different
priorities, and I do believe that there is a basic level of health care that
should be free to all. If you want better care or if you disagree with what is
provided, you’re free to shop outside the system.

~~~
legitster
But you could say the same about food. "Pay me, or starve". But in their
greed, food makers have made food cheap.

~~~
exelius
That’s because food is easy to grow. Stone Age people seem to have figured it
out. Medicine is much harder..

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frankwiles
They're coming for you too CVS and Walgreens.

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jonknee
That’s why CVS is trying to buy Aetna. They’re going to be everything from
your insurer, to your walk in clinic to your pharmacy. Maybe they’ll buy a
hospital chain and go full stack.

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jakelarkin
so Kaiser Permanente, basically

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curun1r
Kaiser still has the "everything in the same building" advantage. There are
some down sides to Kaiser, but seeing my doctor, getting immunizations, having
blood drawn for labs, having prescriptions filled and being out the door 45
minutes after I arrived isn't one of them. It's damn convenient.

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nyxtom
Does this imply that Amazon will be in the place to negotiate drug prices?
Trying to understand what could change given how a lot of PBMs appear to be
wed to insurance groups (and now CVS looking to buy Aetna). What would be the
next step, buy an insurance company? Or is it a matter of exposing the true
cost of drug prices and drive the market costs down?

~~~
legitster
I don't think they would be in a position to negotiate prices anymore than
CVS/Walgreens are. Their upside would mostly be changing the delivery method.

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aviv
Yep, a pharmacy coming to a Whole Foods near you. Circle of life.

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dawnerd
Amazon Basics generic drugs? That could be very interesting.

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mseebach
Not really. FDA approval is already the Amazon Basics of generic drugs. If it
says Acetaminophen 500mg, that's what you're getting, nothing more, nothing
less, within a very narrow tolerance, entirely regardless of brand.

Not so with batteries or HDMI cables, and thus brands add meaningful value in
that space.

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losteverything
Cvs big fear is drone delivery.

Amazon will solve last mile.

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AdamJacobMuller
Why do they need drones for last mile, they can just use their own existing
delivery infrastructure. Drones might be cheaper/better/faster in the long
run, but, they aren't _required_ for this to work.

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losteverything
My comment was totally anecdotal from a big data insider who said cvs is
already extremely concerned drones remove store visits..

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mseebach
The "technology" required is the same as the postal service have provided for
centuries (think pizza delivery for more urgent situations). Sounds like that
insider is spending too much time on pop business sci-fi and too little time
understanding basic facts about logistics (and, very likely, regulatory
restrictions).

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mxuribe
Hey whatever it takes to bring down the awfully (and artificially) inflated
prices of pharmaceuticals in this country (USA), the better I'll feel. If it
takes Amazon getting in on the act - assuming pricing gets better - I'm in
favor of it.

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adventured
Walmart has a large pharmacy business. They attempted to enter the market and
bring prices down (they succeeded in a small way, on a selection of common
generic prescriptions). I'm not sure what Amazon can accomplish beyond what
Walmart was able to with thousands of pharmacy locations. Hoping Bezos & Co.
shake it up though, maybe they'll figure out something new.

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burntrelish1273
Maybe to compete against Express Scripts and drugs stores, to a degree, but a
by-mail pharmacy has a very steep hill to climb in terms of in-
person/telepresence pharmacist expertise.

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revel
Express Scripts is primarily a PBM. It's not the same business

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ben1040
They did $51 billion in network revenue and $43 billion in home delivery
pharmacy revenue in 2016, and their revenue mix has been trending more toward
the pharmacy side over the last few years.

[https://www.sec.gov/Archives/edgar/data/1532063/000153206317...](https://www.sec.gov/Archives/edgar/data/1532063/000153206317000004/esrx-12312016x10k.htm)

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teddyh
Just _think_ of all the interesting data they will aggregate!

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oh_sigh
HIPAA would like to have a word with you.

~~~
bm1362
> "It'd be cool if you kept that data encrypted at rest and kept track of
> every time it's accessed. Oh, you guys have a physical form everyone fills
> out when they access files? Perfect." \- HIPAA in practice

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nasredin
Finally my dream of getting my _cough_ legally prescribed meds _cough_ dropped
by a drone straight into my hands or mouth may come true!

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excalibur
Looks like thousands of Afghan children beat you to the punch there.

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dmead
sounds bad for the opioid problem

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CommentCard
That's a doctor issue, not a pharmacy issue. Although they're probably going
to need some warehouses with higher clearance levels / restricted access to do
this.

I'm all for Amazon filling prescriptions, healthcare is hugely inefficient and
any bargaining power Amazon can wrestle away from pharmaceutical companies
probably won't negatively impact the consumer.

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rs999gti
> I'm all for Amazon filling prescriptions, healthcare is hugely inefficient
> and any bargaining power Amazon can wrestle away from pharmaceutical
> companies probably won't negatively impact the consumer.

I doubt RX prices will decrease if Amazon enters the market. Wal-Mart, Costco,
and Express Scripts buy, warehouse, and dispense millions of drugs to patient
members and drugs prices have barely moved.

