Amazon sent shockwaves through the pharmacy industry when it launched its online pharmacy business three years ago, though at the time, experts were split on how disruptive the venture would prove for incumbents like CVS and Walgreens.
Now, a top leader at Amazon Pharmacy says the business has evolved in the past three years — and in the past three months, after announcing a new generic drug subscription for Prime members and manufacturer coupons for select brand name medications — though the business is still finding its footing.
Healthcare Dive caught up with Vin Gupta, Chief Medical Officer of Amazon Pharmacy, at the HIMSS conference in Chicago on Tuesday. Gupta, a pulmonologist who’s been with Amazon since 2020 and joined Amazon Pharmacy in January, said that the business still has work to do educating providers on Amazon’s options for prescriptions. He also teased updates to affordability initiatives and shared his thoughts on how Amazon’s acquisition of primary care chain One Medical fits into its pharmacy strategy.
This interview has been lightly edited for clarity and brevity.
HEALTHCARE DIVE: How is the Amazon Pharmacy of today different than three years ago?
VIN GUPTA: After the PillPack acquisition we focused on polychronic — how do we make it as easy as possible for those with multiple conditions to take their medications. Now, from a versatility standpoint, just in the last three months we’ve launched RxPass — a Prime membership benefit for $5 a month with free delivery and access to over 50 different medications — and manufacturer coupons.
We’ve seen a lot of traction. We’ve experienced double-digit growth just over the last 12 months. We think that’s largely been driven by not just our DTC channels, but our partnerships. We work closely with PBM Prime Therapeutics and a variety of different insurance plans through them, and are working more closely with providers. And that’s resulted in what has been really sustainable growth.
What other affordability initiatives is Amazon working on?
GUPTA: Manufacturer coupons. It’s a concise list, but it’s a list that we plan to grow. It’s currently eight medications for conditions with large unmet needs. We’re really trying to focus on partnerships directly with manufacturers to expand that offering. That’s a key focus of 2023, and we’ll have more to share in the next couple of months.
With RxPass, there’s been a lot of positive uptake. But it’s a formulary that we don’t view as necessarily concrete. We’re continuing to revisit whether any changes need to occur there to make it pertinent and valuable to as many people as possible.
There’s been some speculation that RxPass might not result in meaningful savings for consumers, given Amazon Pharmacy already offers inexpensive generics. What’s your take?
GUPTA: For the subsegment of individuals who have chronic disease, who might not have robust healthcare coverage, we do think that RxPass provides disproportionate value. Do we think that we’re solving all of the systemic ills in our healthcare delivery system with this offering? Of course not. But I do think that this is an incremental step towards affordability and transparency in drug selection.
Just a small fraction of Prime members use the subscription because of Amazon Pharmacy. Why do you think that is, and how are you addressing it?
GUPTA: Provider awareness is important when it comes to where a patient is designated to get their medications filled. So we’re actively ensuring that my peers, providers across the country, are aware of our services. Whenever I have conversations with my colleagues, they had no idea that Amazon Pharmacy provides this type of visibility into various ways patients can pay, and what that means for bottom line costs. At the heart of it, it’s education. It’s building awareness that we exist.
How are you building awareness?
GUPTA: There’s definitely a word of mouth component. I’ve had several conversations with provider groups. What we hear from them is, tell us more about what this means for our patients. There’s a lot of curiosity. And that curiosity has really spiked. It’s often patients bringing it up to providers, but now provider groups are coming to us proactively and saying, tell us what you’re doing that’s different.
It’s been somewhat bespoke, in terms of us having conversations with interested provider groups. To me, they feel quite collegial and collaborative, on what are the needs right now when it comes to patients across demographics? How are those needs being met from a pharmacy standpoint? And where can we plug in?
Does Amazon direct Amazon provider businesses, like One Medical and Amazon Clinic, to nudge patients to fill prescriptions through Amazon Pharmacy?
GUPTA: With One Medical, it’s just like other provider groups that are not part of Amazon Health Services. One Medical is a provider group that we’re talking to and having conversations with, no different than what we’re talking about with large healthcare systems or another telemedicine company. What do you feel is the biggest pain points in the pharmacy experience for patients? How can we potentially better serve?
But I’ll take off my Amazon hat, and put on my clinical hat, to say that at the end of the day, we still believe in patient choice. It’s important for patients to have choice in where they get their care, and where they fill their prescriptions. We just want to make sure that we are top of mind.
Are you concerned Amazon Pharmacy, if successful, could decimate community pharmacies like Amazon’s ecommerce site did with bookstores?
GUPTA: Many of my patients go to small and medium-sized pharmacies run by families, because they love that interaction with a pharmacist that they know. We believe that we are one stakeholder among many stakeholders that are trying to reinvent an experience. There’s always going to be a place — I firmly believe it’s important to have a place for small and medium-sized organizations within the pharmacy space because some patients prefer that. And we need to nurture that.