Amazon Pharmacy is here and that’s bad news for the brick-and-mortar retail pharmacy industry. But is it accurate to call Amazon Pharmacy “disruptive”?

In a April 2019, CVS Health CEO, Larry Merlo, sat down for an interview with Barron’s to talk about how his company’s assets are positioning them to take on healthcare’s biggest challenges:

It’s estimated that 30% to 40% of emergency room visits could be handled at a lower acuity setting at a dramatically lower cost. If we’ve got chest pains, we’re going to the E.R. But think about the infrastructure cost there. …

Photo by Status Quack on Unsplash

First I want to give a quick thank you to everyone who shared words of support after I published the inaugural S.E.M.I. article. It’s great to see there’s so many who share my interest in pharmacy, healthcare, tech, and strategy. Keep sharing that feedback!

Now, for the first real S.E.M.I. article…

Giant Eagle & Amazon Collaborate

This story, which is now a couple months old, is one worth revisiting because it fits so perfectly into the ethos of Side Effects May Include. There’s so many interesting aspects to this story: competitors becoming collaborators, a legacy company trying to adopt new technology, a new(ish) platform looking…

The identity of pharmacy over the last 60 years has been: 1) push high-dollar products 2) with healthy margins 3) at high volumes 4) as efficiently as possible. Companies carved out their place in that value chain and made a lot of money along the way. However, that model of pharmacy is gradually eroding. Price deflation is contracting margins, payers are clawing back dollars, and patients are increasing their expectations on value and service.

Those existential challenges are producing out-sized effects. Just look at the 5-year stock performance of companies in these three pharmacy sub-industries:

Pharmacy Chains: CVS, Fred’s, Rite Aid, Walgreens

Alex Hoopes, PharmD, CAHIMS

Director of Innovation @ OutcomesMTM, a Cardinal Health company. Responsible for healthcare product development and strategy. Viewpoints are my own.

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