Amazon closed its $3.9 billion acquisition of primary care provider One Medical shortly after multiple news outlets reported the Federal Trade Commission wouldn’t sue to block the deal.
The acquisition marks another move into healthcare for the tech and retail giant. It’s launched a number of ventures in the space, including the new Amazon Clinic and the recently shuttered Amazon Care offering for employers.
Late Wednesday, The Wall Street Journal and Bloomberg reported that the FTC wouldn’t block the deal from closing, though the agency would continue its investigation. Amazon and One Medical first announced the acquisition in July, and they disclosed the deal was under review by the antitrust regulator several months later.
“The FTC’s investigation of Amazon’s acquisition of One Medical continues,” FTC spokesman Douglas Farrar said in a statement. “The commission will continue to look at possible harms to competition created by this merger as well as possible harms to consumers that may result from Amazon’s control and use of sensitive consumer health information held by One Medical.”
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THE LARGER TREND
The completed acquisition is another move into primary care for retail players. After weeks of rumors, CVS Health recently announced plans to buy Oak Street Health, a primary care provider geared toward the Medicare population. Late last year, primary care company VillageMD, which is backed by Walgreens, signed a definitive agreement to acquire Summit Health, parent company of urgent care provider CityMD.
In its latest earnings report, One Medical said it had 836,000 members at the end of the fourth quarter last year, compared with 736,000 at the end of 2021. The company reported net revenue of $274.2 million, a 19% increase compared with the prior-year period. It also posted a net loss of $101.1 million, and adjusted earnings before interest, taxes, depreciation and amortization showed a loss of $36.9 million.
Amazon has been delving into other aspects of healthcare for several years. The company purchased digital pharmacy PillPack in 2018, and it launched Amazon Pharmacy about two years later. It recently announced a subscription service for some generic drugs that will cost a flat fee of $5 per month.
Though some critics have raised concerns about patient data privacy, the tech giant argues its push into healthcare will offer a more convenient patient experience.
“If you fast forward 10 years from now, people are not going to believe how primary care was administered. For decades, you called your doctor, made an appointment three or four weeks out, drove 15 to 20 minutes to the doctor, parked your car, signed in and waited several minutes in reception, eventually were placed in an exam room, where you waited another 10 to 15 minutes before the doctor came in, saw you for five to ten minutes and prescribed medicine, and then you drove 20 minutes to the pharmacy to pick it up – and that’s if you didn’t have to then go see a specialist for additional evaluation, where the process repeated and could take even longer for an appointment,” Amazon CEO Andy Jassy said in a statement.
“Customers want and deserve better, and that’s what One Medical has been working and innovating on for more than a decade.”
Source: Mobihealthnews
