Amazon has announced that it will acquire PillPack. Apparently, Walmart was nearing a deal to acquire PillPack, but the giant retailer delayed a deal from happening which is why Amazon stepped in. It is rumored that Amazon paid about $1 billion in cash to make the deal happen, according to CNBCs sources.
Walmart was in discussions for PillPack for months and was reportedly putting in a lower offer before Amazon stepped in with $1 billion cash offer. Plus Walmart was delaying putting in its final offer.
CNBCs sources also said that PillPack was in the process of raising another round of funding earlier this year in order to move to the next growth phase as it started looking for a buyer. Prior to the acquisition, PillPack had raised over $117 million in funding. PillPacks last round of funding closed was a $55 million Series D back in September 2016.
PillPack dubs itself as a full-service pharmacy that delivers a simpler experience for those who are managing multiple medications. PillPack makes it simple for any customer to take the right medication at the right time, and feel healthier, said PillPack co-founder and CEO TJ Parker in a statement. Together with Amazon, we are eager to continue working with partners across the healthcare industry to help people throughout the U.S. who can benefit from a better pharmacy experience.
Through the acquisition, Amazon will gain pharmaceutical licenses in 49 U.S. states (excludes Hawaii). PillPack delivers medicine, including refills, across the country via mail orders with Express Scripts. Express Scripts manages the prescription drug benefits with the insurers and is considered the largest pharmacy benefits manager company. This agreement will expire at the end of next month and will be renegotiated.
And this acquisition directly impacts pharmacies in retail stores such as CVS, Walgreens, Walmart, Target, etc. Amazons move into the pharmacy space has been rumored for months. And Amazon CEO Jeff Bezos recently formed a nonprofit healthcare organization with Berkshire Hathaway CEO Warren Buffett and JPMorgan Chase CEO Jamie Dimon, which is now being headed up by Atul Gawande as CEO.
It is unknown whether PillPack will continue to operate independently or if a medicine prescription feature will be integrated into Amazon.com.