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Friday, January 27, 2023

Amazon launches subscription-based prescription drug service

Amazon is adding a prescription drug discount program to its growing health care business.

The retail giant said Tuesday that it will launch RxPass, a subscription service for customers who have Prime memberships. Amazon said people will pay $5 a month to fill all the prescriptions they need from a list of about 50 generic drugs, which are usually cheaper versions of brand-name drugs.

The company said the flat fee could cover a list of drugs including the antibiotic amoxicillin and the anti-inflammatory drug naproxen.

Sildenafil also made the list. It is used to treat erectile dysfunction under the brand name Viagra and also treats a form of high blood pressure.

Amazon sells a variety of generic drugs through its pharmacy service. Some are already as low as $1 for a 30-day supply, so the benefit of this new program will vary by customer.

The program does not use insurance, and people with government-funded Medicaid or Medicare coverage are not eligible. It will be available in 42 states and Washington, DC at launch.

Any program that brings low-cost generic drugs to more patients “is a good thing,” said Karen Van Nuys, an economist who studies drug pricing at the University of Southern California. But she added that she wasn’t sure what impact RxPass would have.

He noted that the program is limited to Amazon Prime customers. Other options like Mark Cuban CostPlus Drug Co. sell more generic drugs, many for less than $5.

“I just don’t know if it’s expanding access to a new group of patients,” Van Nuys said.

Still, the move could help the company take up more space in the healthcare market, though it hasn’t always been successful in its goal. Last year, the company shut down its hybrid virtual home care service called Amazon Care after it failed to get traction from employers. And Haven, a company Amazon created in collaboration with JPMorgan and Berkshire Hathaway to improve healthcare costs, dissolved a year earlier.

Amazon has said that its Amazon Pharmacy online pharmacy is a key part of its health care plan, along with primary care organization One Medical, which the online giant is seeking to acquire for $3.9 billion. The Federal Trade Commission is investigating the proposed purchase.

In November, the company also said it would start offering “Amazon Clinic,” a messaging service that connects patients with doctors for some two dozen common conditions, including allergies and hair loss.

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