The announcement of the acquisition of PillPack by Amazon was newsworthy for not only what it signals about Amazon's intentions but also the impact it had on the stock price of competing pharmacy chains. It's also important to consider this from a health care delivery and insurance perspective.
One of the long-time frustrations of health care, especially in population health management, is that patients do not take their medication. Whether they forget to take their medication, get confused as to which pill to take daily, skip it due to the side effects, miss it because of traveling or activities, or even have trouble affording it, the result is poorer health. Once I volunteered to evaluate solutions designed to overcome those myriad challenges at a local health care MBA program. The students designed apps, pill boxes with timers and reminders built in, and pill boxes connected to apps with reminders. Most of these require work from the patient - put the pills into a different container, set up the reminders, and manage the process which can be hard with small pills and hard-to-read labels. It's the same in the start up world; similar solutions vied for attention, though at the end of the process, none seemed to break through the challenges.
What was intriguing about PillPack, and what makes it so easy, is not just that it mails the prescriptions to patients, but that it packages them up completely differently and in a more consumer-friendly way.
It organizes medication, not one pill per bottle, but puts all the medication for a patient in a daily pack. It reorganizes the medication in a way that is organized around the patient. It's simple, but I'm sure that logistically and operationally, it was a challenge. However, I would rather get medication this way.
So why does this matter to health care?
First off, the ease of having medicine delivered. Mail order pharmacy has been a staple of insurance plans for a long time, but with the daily dose concept, this is even easier.
Next, it creates an incentive to ensure that all medicines are ordered and makes it easy to take them. The adherence to the regimen is important to overall health.
And as we know, Amazon makes it easy for consumers to order, and frankly reorder. They want to me to reorder my granola bars regularly, they have the algorithms to do this well.
So, if there is a way to improve the distribution of prescriptions, in 49 states, with the ease of Amazon ordering, consumers will be interested. Insurers will cover PillPack like they cover prescriptions at Walgreens. And health systems that have integrated pharmacies may find themselves needing to compete in convenience, which is hard to do when going head-to-head with the World's Largest Everything store.
It's a bold move that helps Amazon in this space, and one worth watching if you're in the health care industry.
