Drug Companies Are Warming Up to the Idea of an Amazon Pharmacy

(Bloomberg) -- The market is buzzing with speculation that Amazon.com Inc. will enter the pharmacy business. Some drugmakers are just fine with changes the tech retail giant might bring to the complex market.

Drug companies say getting medicine into patients’ hands is too complicated and costly. Some have pointed to the multiple layers of middlemen -- including insurers, pharmacy benefit managers, distributors and pharmacies -- as one reason for distorted prices and high costs in the U.S.

Amazon’s entry could bring more efficiency, Takeda Pharmaceutical Co. Chief Executive Officer Christophe Weber said during an interview in London. That could impact business in the U.S. or in other markets.

“I am all in favor of a more effective distribution system,” Weber said, adding that in some countries the markup can be higher than the manufacturer’s own price. “For us it doesn’t matter so much where the point of sale is, as long as we reach the patient.” 

People would be surprised to know how concentrated the drug wholesaler business already is, said Alessandro Della Cha, CEO of Cosmo Pharmaceuticals NV. Sometimes there are only three competitors in the market, he said -- and Amazon might give better service and force others to adapt.

Amazon hasn’t commented on whether, or how, it could enter the drugs business.

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