Amazon Pharma Business Rumors Are Making Drug Stocks Go Crazy
The rumors around Amazon’s potential entry into the pharmaceuticals distribution business are gathering steam.
CNBC reported late Thursday that the e-commerce giant was holding preliminary talks with generic drug manufacturers such as Mylan (MYL) and Novartis’s Sandoz. The report gave Mylan’s stock price a 4.5% pop in after-hours trading.
A note from investment bank Leerink claimed Thursday that Sandoz’s North American chief, Peter Goldschmidt, recently “met and discussed with Amazon its plans for getting into the U.S. healthcare market.”
CNBC’s sources said Amazon (AMZN) was considering taking on the likes of McKesson (MCK) and Cardinal Health (CAH) in the drug purchasing business. McKesson’s stock price fell by 3.3% in after-hours trading, before recovering slightly.
It’s more likely that Amazon, which is essentially a logistics powerhouse, would try to get into the wholesale pharmacy business than to try selling directly to consumers—if indeed it decides to get into the industry at all.
In October, the St. Louis Post Dispatch cited public records to report that Amazon has over the last year quietly gathered regulatory approval from a dozen states to become a wholesale pharmaceutical distributor.
It does not appear that Amazon has the licenses it would need to get into pharmacy retail. Amazon declined to provide any comment for this story.