Amazon Looks to Expand into Healthcare Business by Adding a Prescription Drug Discount Program

Amazon to launch RxPass, a prescription drug discount program. Prime members can pay USD 5 per month to pick from a list of 50 generic medicines.

Written by: Arjita Gupta

Edited by: Krutarth Ghosalkar

Last Updated: January 25, 2023

Amazon is going to add a prescription drug discount program – RxPass, a subscription service for those who have Prime membership. In its hope to promote its position in the healthcare business, the company said on Tuesday that people can fill as many prescriptions by paying a meager fee of USD 5 a month, from a list of around 50 generic medicines, cheaper than the branded versions. The service will be available in Washington, D.C., and 42 states. The company has a pharmacy service to sell different generic medicines, some as low as USD 1 for a month’s supply.

Thus, the benefit of a prescription drug program will also vary from one customer to another based on the need for medication. This program does not accept insurance. Those with Medicare coverage and Medicaid from the government will not be eligible. The shopping site said that the flat fee will apply to a list of medicines such as anti-inflammatory naproxen, Sildenafil (used for erectile dysfunction under the Viagra brand and for high blood pressure as well), and antibiotic amoxicillin.

An economist, Karen Van studies medication pricing at the University of Southern California. She said that any health program that helps people to get low-cost generic medicines is a good thing. Going forth that given everything; Karen is not sure the impact RxPass will have on users because the Amazon’s prescription drug program is limited to subscribers of Amazon Prime only. There are alternatives such as the Mark Cuban CostPlus Drug Co that has a plan of under USD 5 for generic medicine, generating better sales.

Thus, Van said whether the initiative by Amazon currently is actually going to expand access to new patients or not is a huge question. In the healthcare market, the Amazon prescription drug program can help strengthen its presence. However, as of last year, the aim for which, has not been that successful as it had to shut off Amazon Care, an in-home care service with a hybrid virtual service. The initiative did not receive much response from employers. Also, Amazon had gone into a collaboration with Berkshire Hathaway and JPMorgan with its venture, Haven.

But the motto of improving health costs just did not click, and Haven was dissolved a year before Amazon Care. As a part of its healthcare plan, Amazon Pharmacy is an extension of its parent company. It also had plans to acquire One Medical, a primary care company for USD 3.9 billion. The proposed buyout is being investigated by the Federal Trade Commission. The firm may also come out with a messaging service, Amazon Clinic, in its announcement in the month of November. The service will help patients to consult doctors for over two dozen medical conditions such as hair loss, allergies, and others.