Amazon’s plan for the pharmaceutical space will be one of the biggest questions in health care. yet the tech giant’s inexperience within the space may be revealing itself, according to analysts at RBC Capital Markets.
Tuesday, RBC analysts suggested that will the cancellation of pharmaceutical wholesaler license applications in Maine may imply that will Amazon doesn’t plan to enter the space.
yet Wednesday, the analysts said This specific’s become clear that will the state, not Amazon, did the canceling, due to the applications not being complete by a Dec. 1 deadline.
“Our key takeaway coming from This specific experience will be that will Amazon will have to endure the same learning curve along with also regulatory hurdles within the space as any different company,” RBC analysts George Hill, Stephen Hagan along with also Lee Lueder wrote in a research note. “The Maine experience reminds us that will despite its mystique, Amazon will be not immune to doing mistakes or infallible.”
“Wholesale licenses are required for Amazon Business to sell professional-use only products to health-care customers — coming from medical along with also dental offices to hospitals,” an Amazon spokeswoman told CNBC. She referred different questions to its website.
Indeed, Morgan Stanley downgraded Henry Schein along with also Patterson Cos. on Wednesday because of competition coming from Amazon in dental distribution.
Amazon hasn’t commented on what, if any, plans This specific may have to compete within the pharmaceutical space, yet speculation about its entry has weighed heavily on stocks of retail pharmacies, drug distributors along with also pharmacy benefits managers.
In October, the St. Louis Post-Dispatch reported Amazon had acquired pharmaceutical wholesaler licenses in several states, yet experts quickly pointed out that will the licenses supported existing businesses rather than a brand-new area of prescription drugs.
RBC suggested Tuesday that will the Maine licenses could be a leading indicator of Amazon’s plans in pharmaceuticals, because the state doesn’t require a medical device license for the sale of medical supplies; thus, RBC suggested, Amazon’s application there may have suggested the licenses were for prescription medicines.
Wednesday, RBC referred to the canceled Maine applications as “evidence of inexperience,” pointing out This specific couldn’t find evidence of Amazon filing subsequent pharmacy licenses within the state.
“The consensus will be that will Amazon’s different healthcare related licenses are for the device along with also supply distribution,” the analysts wrote Wednesday. “Amazon does not need a license due to This specific line of business in Maine, only for drugs. This specific could explain why Amazon abandoned the license process.”
Many are skeptical Amazon will take on such a heavily regulated industry; Walgreens Boots Alliance CEO Stefano Pessina said as much at the Forbes Healthcare Summit last week.
“Maine’s action shows that will Amazon faces many challenges entering the pharmacy distribution along with also reimbursement system,” said Adam Fein, of Pembroke Consulting. “The drug industry will be much harder to disrupt than direct-to-consumer retailing or business-to-business channels for finished products.”
RBC’s analysts suggested the same, noting Wednesday that will “Amazon’s intentions for the drug supply chain are the subject of obsession at This specific point”— yet still are no more clear.