By Chris Williamson-
Amazon has expanded its ever growing ambition into distant parts retail landscape, and is now venturing into the U.S pharmacy market.
Amazon’s several ventures
that has seen the giant company excel it expand its landscape across streaming videos, groceries, fashion, and other areas has not stopped amazing from continuing its dream to extend its empire beyond its own wildest dreams. The giant company at the moment provides supply-chain services to other retailers and also operates physical stores. The biggest cloud services company in the world, Amazon has not decided to venture into the U.S pharmacy market.
The U.S pharmacy market is a very lucrative market, Amazon wish to explore. It is more regulated than any of Amazon’s current markets. That aside, though, it has several features that put it right in Amazon is already in talks with a few industry figures and have hired a few executives in the field to support their latest business ambition.
PHARMACY MARKET
Among the drug makers, are the pharmacy benefit managers, or PBMs,. Their multiple roles include negotiating drug prices with manufacturers, processing pharmacy benefit claims, and operating home-delivery pharmacies. Next are the wholesalers, who physically distribute drugs to pharmacies and hospitals.
Retail pharmacies. involved in the deal include PBMs, Express Scripts, Caremark and Optum Rx, which control three-quarters of that market, according to Barclays’ research. The first is an independent company valued at $44bn. The latter two are owned by CVS Health, the largest US pharmacy chain, and United Health, the biggest health insurer, respectively.
Unsurprisingly, the industry boasts strong returns. Express Scripts’ percentage return on invested capital exceeds those of Amazon’s level, and it earns about $5 in operating profit for every prescription it processes. There are three dominant wholesalers in the mix, namely; AmerisourceBergen, McKesson and Cardinal Health, with a total market value of $77bn. They distribute 90 per cent of the drugs sold in the US. The two largest retail pharmacy chains, CVS and Walgreens, have thousands of outlets between them, and control half of the market. At both the distributors and the pharmacies, returns on capital are, again, solidly ahead of Amazon’s.FT Engage
Yesterday , Amazon captured the UK TV rights to the US Open tennis tournament, in a move likely to confirms circulating whispers that it is a potential competitor in the upcoming Premier League rights auction. The mega rich company has struck a five-year deal for the U.S Open, formerly shown by Sky and Eurosport in the UK. Amazon is estimated to have paid about $40m (£30m) for the rights. Its ownership of the rights to one of the four grand slams adds to Amazon’s £50m, five-year deal for the UK rights to the ATP World Tour.
