Why Does Amazon Want To Get Into Pharmacy?

It’s shaken the drone, delivery and retail markets. It’s making waves with its cashier-less store, blimp warehouse and homeless shelter. Now, having proven itself a formidable competitor in all other respects, the master of all trades is taking steps to infiltrate the multi-billion-dollar pharmacy business.

After several years of weighing its potential in the space, according to CNBC sources, Amazon.com, Inc. AMZN is preparing to capitalize on the evolving and increasingly attractive healthcare climate. The company is said to have hired a new general manager under the consumables division, begun recruitment of pharmaceutical players and entered talks with industry experts.

A Long-Set Precedent

The move isn’t necessarily out of nowhere. Amazon tiptoed into the medical realm through its recent sale of equipment and supplies in the U.S., as well as the offering of particular substances globally.

Last month, it began collaborating with Japanese pharmacies to deliver prescription drugs via its Prime services. Customers can use the website to report their symptoms and medical history and receive online approval by local pharmacists, according to The Japan Times.

If it continues to expand its delivery service, in-house drug development may help lower pricing to appeal to a broader consumer base. Regardless of its impact on sector costs, Amazon’s general participation in the market is reason for other pharmaceutical players to fear.

“A couple of months ago, they said they got in the auto parts industry. Look what happened to stocks like AutoZone, Inc. AZO — they got obliterated,” CNBC’s Guy Adami said on Tuesday’s "Squawk Box." “It’s world domination they’re going for, and right now they’re succeeding.”

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