News That Amazon Is Shelving Plans To Sell Drugs To Hospitals Sends Distributors’ Stock Soaring
“This is not necessarily an all-clear event for the supply chain,” said Eric Coldwell, an analyst at Robert W. Baird & Co. “Still, it’s a good reminder that Amazon’s supply chain ambitions might not be as big as feared or valuations indicate.”
Reuters:
Drug Suppliers' Shares Rise As Looming Amazon Threat Appears To Ease
Shares of U.S. drug suppliers rose on Monday after a report that Amazon.com Inc had dropped plans to sell drugs to hospitals, in a boost to a pharmaceutical supply chain rattled by the looming threat of competition from the online retailer. Stocks of drug distributors McKesson, AmerisourceBergen and Cardinal Health rose 2 to 3 percent, while drugstore chains Walgreens Boots Alliance and CVS Health each advanced about 5 percent. (Mishra, 4/16)
CNBC:
Amazon Has Shelved A Plan To Sell Drugs To Hospitals, And Insiders Say There Are Two Reasons Why
Instead, the company is focused on selling less sensitive medical supplies to hospitals and smaller clinics through Amazon Business — and it has found that business to be more challenging than expected. The setback illustrates the challenges of getting into the medical supply and pharmaceutical space, even for a company as big as Amazon. (Kim and Farr, 4/16)
CNN Money:
Pharmacies Surge On Report That Amazon Is Backing Away From Prescription Drugs
Amazon's potential entry into the prescription drug business has weighed on pharmacies for months. The specter of an Amazon pharmacy likely played in a role in CVS's decision to acquire Aetna, and Walmart's consideration of snatching up Humana. Last summer, Amazon quietly launched a line of over-the-counter private-label medicines manufactured exclusively for Amazon by Dublin-based Perrigo. (Wiener-Bronner, 4/16)
Bloomberg:
CVS Rallies After Amazon Report
CVS Health Corp., along with rival drugstores and drug distributors, rallied after a report that Amazon.com Inc. had shelved plans to sell drugs to hospitals and other businesses. ... CVS rose as much as 8.7 percent, the biggest intraday gain since December 2011. Drugstore chain Walgreens Boots Alliance Inc. was up as much as 6.8 percent. Neither company’s main business is selling directly to hospitals or doctors. (Langreth and Soper, 4/16)
