Will Amazon Conquer Healthcare Next?

Amazon is deepening its commitment to healthcare with the introduction of automatic coupons for more than 15 insulin and diabetes care brands through Amazon Pharmacy.

An estimated 85% of manufacturer-sponsored coupons go unused, leaving significant savings for consumers on the table. Amazon’s service aims to reduce the financial burden insulin and similar medications can have on many consumers — one in 10 Americans have diabetes, about 8 million use insulin to help manage their condition, and 14% of them struggle to afford the cost of treatment — by tapping into these coupons.

The coupons will be aimed at the most commonly prescribed products from manufacturers, including Novo Nordisk, Eli Lilly, Sanofi, Dexcom, and Insulet. They will cover items like insulin vials, pens, continuous glucose monitors, and pumps, with the goal of reducing the costs for eligible customers to a starting level of $35 per month. These benefits are being added to the free delivery and access to pharmacists already provided to Amazon Pharmacy members.

Amazon is enabling the automatic redemption of coupons through a proprietary technology that promises to work for all eligible customers, no matter if they’re insured, underinsured, or uninsured. The final price is viewable directly on Amazon to ensure that these shoppers don’t miss out on any potential savings elsewhere.

However, there are limits to the program. The e-commerce giant noted that these coupons are ineligible for use with other Amazon programs, like RxPass or the prescription savings available for Prime members. Additionally, they don’t apply to patients covered by state or federal healthcare programs.

Non-pharmacy retailers entering the healthcare space have often touted their ability to reduce costs for customers as one of the key benefits of their involvement. The aforementioned RxPass offers a selection of generic medications for $5 a month, and Prime members have access to six-month prescriptions for the equivalent of $1 per month — a move that was timed to coincide with a different cut-price subscription plan from medtail rival Walmart.

Amazon’s healthcare push isn’t limited to retail, either. Amazon Web Services recently launched HealthScribe, a HIPAA-eligible generative AI-powered solution that can help healthcare software providers automatically create clinical documentation. 

The non-retail push could prove helpful if Amazon is hoping to turn its pharmaceutical ambitions into major profits. A 2022 Morgan Stanley survey found that just 2% of consumers cited Amazon Pharmacy as a reason to want Prime, according to Business Insider. That hasn’t slowed down Amazon, which closed on its acquisition of One Medical in early 2023 to further enhance its telehealth capabilities.

Healthcare remains a lucrative industry even if pills and consultations aren’t moving Prime subscriptions. The space was valued at $4.3 trillion in 2021 and is estimated to grow to $6.2 trillion by 2028, according to data from Insider Intelligence. Even a small slice of that pie is valuable, and if Amazon can become as big a name in healthcare as it is in e-commerce and web services, the company that conquered the internet could be poised to conquer the world.