Amazon Pharmacy: The Latest Sign That Online Shopping Is Here to Stay

Ryan Faist

Ryan Faist, Channel Key

December 27, 2021

Customers can now fill their prescription medication via Amazon as easily as ordering a pair of socks or a smart speaker. Well, almost as easily. In November, the retail giant launched an online and mobile prescription medication ordering and fulfillment service called Amazon Pharmacy. The new store allows customers to complete an entire pharmacy transaction on their desktop or mobile device through the Amazon App. Using a secure pharmacy profile, customers can add their insurance information, manage prescriptions, and choose payment options before checking out.

As a new benefit for those who pay $119/year, Prime members receive unlimited, free two-day delivery on orders from Amazon Pharmacy. The new service also provides savings of up to 80% off generic and 40% off brand name medications for Prime members who are currently uninsured. The discount applies not just to Amazon Pharmacy, but also more than 50,000 participating pharmacies nationwide.

Amazon states its new pharmacy service will make it simpler for customers to compare prices and purchase medications for home delivery. The retail giant emphasizes three key benefits that it hopes will appeal to customers:

  • Medication Research and Confidential Orders: The same browsing experience customers are familiar with from Amazon makes it easy to discover what medications – including branded and generic versions, and different forms or dosages – are available through Amazon Pharmacy. Before checking out customers can compare their insurance co-pay, the price without insurance, or the available savings with the new Prime prescription savings benefit to choose their lowest price option.
  • Seamless Transactions: Customers can add insurance information and ask their prescriber to send new or existing prescriptions directly to Amazon Pharmacy for fulfilment. Purchase is as simple as confirming the request on the Amazon App or website.
  • Access to Fully Digital, Personalized Quality Care: Customers have online self-service help options combined with phone access to customer care at any time. Friendly and knowledgeable pharmacists are available 24/7 to answer questions about medications.

The launch of Amazon Pharmacy comes more than two years after Amazon released an exclusive line of more than 60 over-the-counter healthcare products called Basic Care. The products are produced by private-label manufacturer Perrigo and range from allergy and cold medication to hair regrowth treatment. The move was considered by many as a sure sign that Amazon was interested in disrupting the pharmacy industry.

This speculation was reinforced when Amazon announced in August 2018 that it was acquiring PillPack for what was later revealed to be $753 million. PillPack is a full-service pharmacy that delivers individualized, single-serve packets of daily prescription medication directly to patients. Founded in 2013, PillPack quickly proved to meet an untapped demand in the healthcare market. By 2017, the startup was already forecasting $100 million in annual revenue.

“As more and more people look to complete everyday errands from home, pharmacy is an important and needed addition to the Amazon online store,” said Doug Herrington, Senior Vice President of North American Consumer at Amazon in a press release. “PillPack has provided exceptional pharmacy service for individuals with chronic health conditions for over six years. Now, we’re expanding our pharmacy offering to, which will help more customers save time, save money, simplify their lives, and feel healthier.”

Acquiring PillPack – which came with an established logistics infrastructure and proprietary software platform – provided a perfect foundation for Amazon to build out its own comprehensive pharmacy service. The launching of Amazon Pharmacy in November is particularly well-timed. Citing a study by the National Library of Medicine, Nasdaq recently reported that approximately 25% of older adults on a limited income have either delayed or simply not filled prescriptions due to cost during COVID-19. The savings provided by Amazon Pharmacy will likely appeal to these customers, as well as those who are out of work and now uninsured due to a struggling economy.

“Healthcare and drug distribution is ripe for disruption. Amazon has the infrastructure and the pharmacy know-how through its acquisition of PillPack to make it easier for patients to obtain their prescription medication.” – Dan Brownsher, President and CEO of Channel Key


Amazon’s disruption of the pharmacy industry has been in the works for several years now. With a massive customer base and efficient delivery infrastructure, it seemed inevitable that the retail giant would – at some point – find a way to enter the healthcare arena. In the middle of a pandemic, this could not have happened at a more convenient time. It’s no secret that COVID-19 has become a turning point for e-commerce. More people are shopping online than ever before – some because of convenience; others because of necessity. This year’s holiday shopping season has set just about every record imaginable, with Cyber Week generating $34.4 billion in sales, a 20.7% YoY increase from 2019. Perhaps more significant is what people are purchasing online. It’s not just gadgets and gifts. Online grocery shopping, for example, has exploded during the pandemic. Data from Inmar Intelligence shows that nearly eight out of ten consumers have purchased groceries online this year, a 19% boost from 2019. This spike in e-commerce has translated to a greater demand in the healthcare market as well. With more than 160 million Americans taking prescription drugs, it should be no surprise that people want to get their medication with the same convenience and savings that they do just about everything else – and via the same platform.

About Channel Key

Channel Key is a full-service channel management marketplace consulting agency that has helped generate $250M in Amazon sales for retail brands around the world. Complete 360-degree services include marketplace strategies, content development, marketing and advertising, catalog management, marketplace and fulfillment setup, ongoing consulting, and much more. To learn about how Channel Key can help increase sales for your business, contact us today for a free consultation.


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