The shares of drugstore companies had started to fall on Thursday after the ecommerce giant Amazon announced that it had signed a deal for taking over the online pharmacy Pill Pack. The shares of Rite Aid went down by about 11 percent, Walgreens Boots Alliance by about 9 percent and CVS Health by about 8 percent. These three companies together lost about 12.8 billion dollars in terms of market value on Thursday alone. Pill Pack is an online pharmacy that packages, organizes and delivers pre-sorted doses of medications. The website of the online pharmacy states that it is licensed to ship prescriptions in 49 states. In the month of November last year, the CEO of Pill Pack mentioned that it was on track to post more than about 100 million dollars in revenue for the year 2017.
Jeff Wilke who is the Amazon CEO Worldwide Consumer mentioned in a statement that the visionary team of Pill Pack has a great combination of deep pharmacy experience along with a focus on technology. Jeff also added that Pill Pack is meaningfully improving the lives of its customers and Amazon wants to help them in continuing with this task, making it easy for people to save time, simplify their lives, and feel healthier. He said that Amazon is extremely excited to see what both of them can do together on behalf of the customers with the passage of time.
Investors have expected for a long period of time that Amazon would be disrupting the pharmacy business. In May 2017, CNBC reported that Amazon was hiring people for the purpose of breaking into the multibillion-dollar pharmacy market. In October 2017, the St. Louis Post-Dispatch reported that Amazon had possession of the necessary approvals for wholesale pharmacy licenses in about 12 states. This is a report which had sent these same stocks faltering that day. All the stocks of the three pharmacy companies, Walgreens, CVS and Rite Aid went down by more than about ten percent the past twelve months because of this particular fear. More than about four billion prescriptions are ordered in the United States each year. An estimated amount of about 300 billion dollars was spent on prescription drugs by patients, insurance companies and other parties in the year 2015. The terms of the agreement were not revealed. The companies expect Pill Pack to shut down during the second half of this year.