Health and Science

FDA chief on Amazon's health-care move: 'Disruptive competition is a good thing'

Key Points
  • FDA Commissioner Scott Gottlieb says anything that makes much needed products more accessible to consumers and lowers costs is a good thing.
  • However, Gottlieb says there will be an important role for brick-and-mortar pharmacies and "incumbent players" in health care.
Dr. Scott Gottlieb
Cameron Costa | CNBC

FDA Commissioner Scott Gottlieb says Amazon's new push into health care is just fine because anything that makes much needed products, like pharmaceuticals, more accessible to consumers and lowers costs is a positive.

"Disruptive competition is a good thing," Gottlieb said Friday in an interview with CNBC's "Squawk Box."

"The supply chain, the intermediaries, are a cost on the system. So, seeing more competition into that marketplace will help bring down costs, maybe promote use of generics."

Amazon announced plans on Thursday to acquire online pharmacy start-up PillPack, immediately sending shares of drugstore operators and drug distributors tanking.

PillPack, which organizes and delivers packages of medications for consumers, is licensed to ship prescriptions in 49 states.

The move, which is the strongest indication yet of Amazon's intent to push further into health care, threatens to remove to one of the few distinguishing factors pharmacy chains have relied on to fend off the online retail giant — the sale of prescription drugs.

Gottlieb, who has a background in venture capital, said there will still be an important role for brick-and-mortar pharmacies and "incumbent players" in health care.

"If you're picking up your things in the pharmacy, you're also picking up other things as well," Gottlieb said. "My sense is this is going to be a slower evolution in the market towards disruptive systems. There's a reason why a lot of the incumbent players have built a lot of market share here."

Ana Gupte, senior health care services analyst at Leerink Partners, advised clients to remember that Amazon's push into the pharmaceutical space won't happen over night. However, she said the stock plunges Thursday on Amazon's news was "rational."

"It's going to take a long time," Gupte told "Squawk Box." "Maybe they get 5 percent market share after quite a while. But that threat will be there and they will grow share over time."

Gupte expects the new service will also attract Amazon's Prime members to its other products, saying it's a "pretty good cross sell move."

—CNBC's Angelica LaVito contributed to this report.