Amazon is buying the online pharmacy PillPack, the e-commerce giant announced on Thursday, representing Amazon’s latest push into the U.S. healthcare market.
The deal, reportedly worth around $1 billion in cash, is a major blow to retail rivals like Walmart, which was also vying for Somerville, Massachusetts-based PillPack. Traditional drugstore operators like CVS, Rite Aid and Walgreens Boots Alliance, all saw their stock prices drop on news of Amazon’s PillPack acquisition.
On the other side of the deal is PillPack CEO TJ Parker, 32, who co-founded the company in 2013 along with Chief Product Officer Elliot Cohen, 35. Parker and Cohen, who met while Parker was studying to become a pharmacist and Cohen was getting his MBA at MIT, started PillPack in the hopes of making it easier for people to buy prescription and non-prescription drugs online.
“PillPack makes it simple for any customer to take the right medication at the right time, and feel healthier,” Parker said in a statement on Thursday.
The company, which was valued at roughly $360 million in 2016 according to PitchBook, bills itself as a full-service pharmacy that fills prescriptions and ships drugs packaged in pre-sorted doses. The aim is to make it easier for customers to manage multiple medications. The startup is also notable for using robots to sort customers’ drugs in order to save on the costs of human workers.