Amazon is showing interest in health care, and it’s making industry players ‘nervous,’ says investor

Amazon is sending all kinds of signals that it’s interested in the health-care industry.

CNBC reported in May that the company was on the hunt for a general manager to lead a new pharmacy unit. Since then, it has brought on a slew of health experts to bolster its cloud offering, Amazon Web Services, and rallied the industry to build applications for its Alexa voice technology. Amazon has also been selling medical supplies online for some time.

That interest is making some players in the health-care industry nervous.

“I get asked all the time what Amazon is doing,” said Tom Rodgers, managing director of McKesson Ventures. McKesson, a medical distribution giant, is one of the companies that analysts suggest would be poised for disruption by Amazon.

“Everyone in the supply chain is nervous,” Rodgers acknowledged. “It’s a low-level paranoia that Amazon will drive down profitability.”

But Rodgers doesn’t think Amazon will take on the big distributors head on — at least not right away. Instead, he thinks the company will want to be the “partner of choice” to help consumers navigate health care.

“I would expect a marketplace of sorts for consumers to choose a doctor or service, and schedule it,” he explained. The companies that would be threatened — or potentially bolstered through M&A and/or partnerships with Amazon — are early stage and include consumer health tools like Zocdoc, Castlight, Teladoc and GoodRx.

Rodgers expects that Amazon will roll this out in a quiet way by developing strategic partnerships and building its own internal tools. Someday, he said, users will wake up and realize that Amazon has access to a huge repository of health data, which will be easily accessible in the cloud.

That might pave the way for Amazon to get into other areas of health care, including pharmaceutical distribution.

By Christina Farr | CNBC

Image Credit: Michael Prince/Forbes Collection/Corbis Outline


About Peter Coffaro 833 Articles
A growth-driven and strategic executive, Peter Coffaro commands more than 20 years of progressive management success within the orthopedic industry. Recognized by as one of the top medical sales influencers in the industry; he has 10 years of combined sales management experience and has held positions as a Director, General Manager and Distributor. Peter has worked for some of the top orthopedic companies in the world - Zimmer, DePuy and Stryker. He is also the founder of OrthoFeed: a popular blog that covers orthopedic news and emerging medical technologies. Peter is a three-time Hall of Fame award winner at Johnson and Johnson and has an extensive background in organizational development, business development, sales management, digital marketing and professional education. Peter holds a B.S. degree in Biology from Northern Illinois University.

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