By Jeff Mordock
The Amazon effect has rocked bricks-and-mortar retail. Now it’s moving in on the health care market.
Analysts say CVS Health Corp.’s $69 billion bid for Aetna Inc., marking the first time a large pharmacy chain has merged with a major health insurer, is a direct result of Amazon’s plan to enter the prescription drug market.
“Everything Amazon does is disruptive; sometimes it’s just not clear how,” said Jason Bloomberg, CEO of Intellyx, a digital transformation consultant business.
The online retail giant made pharmacy chains nervous in October when it was revealed that Amazon had secured licenses to distribute prescription medicines in 12 states. CVS is believed to be making the Aetna deal to withstand a potential challenge from Amazon by creating a “one-stop shop” where consumers can get prescriptions, insurance coverage and treatment in one location.
By forcing CVS into the largest merger announced this year, Amazon is showing its might, analysts said. But they are unsure how Amazon will disrupt the health care sector — perhaps by acquiring a pharmaceutical manufacturer or by launching its own pharmacy benefits manager, or PBM.
Mr. Bloomberg said he wouldn’t be surprised if patients one day are treated at Amazon hospitals.
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