Amazon Pharmacy expanded its same-day medication delivery service to New York City and Los Angeles, with plans to add a dozen more U.S. cities by the end of the year, the company announced Tuesday.
Amazon's pharmacy business plans to use environmentally friendly delivery vehicles, including e-bikes and electronic vans, with a strategy to pick the "best delivery method at each location to get prescriptions to customers," executives said.
Customers in New York City and the Los Angeles area who need medication to manage flu, high blood pressure, diabetes, and other common conditions can now get their medications delivered to their door within hours, according to the company.
Amazon Pharmacy already offers same-day delivery of prescription medication services in Austin, Indianapolis, Miami, Phoenix and Seattle.
In October, the company launched drone delivery for prescription medication orders with the service initially taking flight in College Station, Texas.
“By bringing Amazon Pharmacy’s deliveries into our existing world-class logistics network, Amazon is building the fastest and most convenient service for the home delivery of prescription medications,” said Doug Herrington, CEO of Worldwide Amazon Stores.
Amazon Pharmacy is modernizing the home-delivery experience by reducing delivery speeds to hours in some cases. The company claims it outperforms the industry standard of up to two weeks.
The online retail giant unveiled Amazon Pharmacy in November 2020 after it acquired PillPack in 2018. The company has been using its logistics and supply chain muscle to make it faster and easier for patients to get their prescription medications and speed up "triage to treatment," executives said in previous interviews.
Dr. Vin Gupta, chief medical officer for Amazon Pharmacy and a pulmonologist, says speed to treatment and eliminating extended wait times for medicines is critical to provide better care for patients.
“The current pharmacy experience is broken, with patients facing long pharmacy lines and unexpected prices at the counter,” Gupta said. “Amazon Pharmacy is tapping its world-class logistics network, along with a variety of cutting-edge technologies, to change that.”
Amazon Pharmacy has largely been focused on price transparency and affordability of branded and generic drugs. Amazon rolled out RxPass, a prescription drug subscription for Prime members, as well as a new feature to make it easier for consumers to use manufacturer discounts on branded meds by integrating the coupons into the checkout experience.
But, in the past three and a half years, Amazon Pharmacy also has been building out its partnerships with major health plans and pharmaceutical companies, expanding its footprint in the pharmacy market.
In August, Blue Shield of California made a big splash when it announced it would sever most of its ties with CVS Health’s Caremark, its current pharmacy benefit manager, and instead partner with Amazon Pharmacy, Abarca, Mark Cuban Cost Plus Drug Company and Prime Therapeutics to manage prescription costs of its health plan members. Amazon Pharmacy will provide home delivery of prescription medications for the insurer's nearly 5 million members.
Earlier this month, Eli Lilly tapped Amazon's pharmacy unit to offer home delivery for diabetes, migraine and obesity medications, including GLP-1 weight loss drug Zepbound. The drugmaker launched its direct-to-consumer service, LillyDirect, in January to provide consumers access to telehealth and pharmacy services and the ability to get some medications directly from the company via online pharmacies.
Gupta contends that Amazon Pharmacy is changing the pharmacy experience and it goes beyond just faster delivery speeds.
"This is why we exist; it's through these partnerships to reimagine how large healthcare systems and traditional stakeholders can engage with a differentiated experience. So there's value for them, but then there's value for the individual patient, and especially for the individual provider," Gupta said in an interview. "I believe our growth and how we think about partnerships is ultimately based on what's best for clinical outcomes. We have the challenge of convincing a provider that they should take 15 seconds out of their day, in a patient visit, to revisit the pharmacy on file in the EHR to consider us. And, we think that considering us, across the country, but especially in places where we can offer an elevated speed experience, in choosing us, you would have access to the very best in logistics and technology that we're known for at Amazon. When coupled with the power or our clinical excellence and 24/7 accessibility, that is just an experience that no one is used to."
Amazon Pharmacy offers 24/7 access to clinical pharmacists, he noted.
"The ability to speak to a live human being, without having to wait 30 minutes, and get that 24/7 clinical support, that's rare. That's a differentiated clinical experience, and that is a big part of our partnership with [Eli] Lilly. We have a unique partnership with them. It's more than just us dispensing the medication, the last mile, it's also us being there for the patient if they have questions," Gupta said, adding, "Lilly recognized that; we're more than just logistics, we're clinical excellence."
Amazon Pharmacy aims to "check the boxes across all three"—direct-to-doorstep delivery, price transparency and clinical excellence, Gupta said. "We know the world doesn’t need another pharmacy. We need a better pharmacy that can partner with providers to provide patients the care they need at the time they need it the most," he said in a video.
Earlier this year, Amazon eliminated a "few hundred roles" across One Medical and Amazon Pharmacy.
But Amazon is seeing “tremendous growth” from Amazon Pharmacy, One Medical and its virtual health clinic, Neil Lindsay, Amazon Health Services Senior Vice President Neil Lindsay, wrote in a memo to employees last month, CNBC reported.
The use of AI in pharmacy operations
Artificial intelligence has become a buzzword in healthcare, but Amazon Pharmacy is integrating generative artificial intelligence (AI), machine learning and new technologies in its pharmacy operations with the goal of getting prescriptions filled more quickly and accurately.
AI can streamline prep work that historically would take hours down to mere minutes or even seconds, and reduce administrative errors, noted Kelvin Downes, director of fulfillment for Amazon Pharmacy.
AI is helping Amazon Pharmacy be “smarter” with its last-mile distribution capabilities, Gupta noted.
“There is often a delay simply on ingesting a prescription from provider to pharmacy to then physically get it out and dispense it, the processing time,” Gupta said. There is a lot of unstructured information with medication scripts, including directions from the prescriber. One physician might write “three times a day” as far as how frequently the patient should take the medication, while another physician might write, “t.i.d.,’ Gupta explained.
“It’s on the processing piece that we are really leaning heavily into generative AI,” he said. “We’re trying to remove as much operator error and decoding of a script as possible to process these scripts as fast as possible. We're making this process safer, not just not just faster."
The use of generative AI has helped Amazon Pharmacy increase processing speed by more than 90%, according to Gupta.
When handwritten or online prescriptions come in, Amazon’s AI models undertake a series of fact-checking tasks that help ensure pharmacists receive clear and accurate information.
According to Downes, no prescription leaves a fulfillment center without a pharmacist having verified that it includes the right medicine, strength, dosage, quantity, and address label.
Amazon Pharmacy also is using generative AI and machine learning to provide consumers with transparency pricing estimates for medications, Gupta noted. “Based on historical claims data, millions of data points on prior claims for medications, we can reasonably tell somebody who has never filled the medication once with us how much a medication would cost if they're applying traditional copay. We're able to leverage that information to say this is what you can expect to pay for a common generic or a branded medication,” he said.
Amazon's pharmacy unit also uses new small-format facilities, stocked with the most common prescription medications for acute conditions, to get medications closer to where customers live. The company’s new small-format facility in Brooklyn carries a subset of the more than 12,000 medications available from Amazon.com, focusing on supporting urgent care needs. The pharmacist and fulfillment team at the site can process a prescription within minutes rather than hours or days, according to the company.
The company also uses AI to forecast demand for medications in specific areas of the country to adjust its supply of prescription drugs in stock in those distribution centers.