How Amazon’s continued expansion into healthcare could boost the industry –


After Amazon’s $3.9 Billion acquisition of One MedicalBusiness Insider reported that the company would to add mental health care to her portfolio. While there are skeptics who fear Amazon’s track record of privacy in healthcare, some say the company’s moves could be positive for the industry.

The tech behemoth originally entered the health sector after it acquired PillPack, an online pharmacy, in 2018 and was later renamed Amazon Pharmacy. The company also offers Amazon care as a way for individuals in certain states to receive treatment.

While those efforts seem to be paying off, Amazon also had a failed venture, Haven, with Berkshire and JPM disbanding after multiple internal issues.

Despite the ups and downs, Amazon said in a press release detailing the acquisition of One Medical it plans to improve quality of care across the board:

We think healthcare is high on the list of experiences to be reinvented. Make an appointment, wait weeks or even months to be seen, take time off from work, drive to a clinic, find a parking space, wait in the waiting room and then the exam room for what are all too often a rushed few minutes with a doctor , then take another trip to a pharmacy – we see many opportunities to both improve the quality of the experience and give people back valuable time in their days.

Now that Amazon has its own resources for drug distribution, the acquisition could in a sense boost demand as the company can now access providers in different markets.

For Deena Shakir, a partner at Lux Capital, Amazon’s move demonstrates the value of healthcare for leading tech companies.

“This deal underscores the value Big Tech places on healthcare and the importance of omnichannel/hybrid (brick-and-mortar in addition to virtual) and tech-enabled services,” Shakir told via email. “It’s a better multiple/comp than we’re seeing in the public markets right now and shows that there are valuable exit opportunities for businesses, even in a downturn or icy IPO market.”

But for Adrian Aoun, founder of Forward Health, he said he wished Amazon did more.

“You literally take the world’s most impressive tech company and you’re just aiming low,” he said.

a medicalBased in San Francisco, it provides care in nine markets and serves nearly 400,000 people, but for Aoun, that’s not enough for Amazon. He explained to that Amazon needed to align itself with being proactive rather than reactive in healthcare.

“What Amazon just did is they joined the completely wrong incentive,” Aoun said. “They just literally said, ‘We’re going to focus on keeping you working, not staying alive.'”

While there is pressure from the tech giant to expand its own services, Aoun added that the company had to be resourceful.

“Amazon just honestly made one of the classic mistakes in innovation, I’d say,” Aoun said. “They’re trying to rebuild the old world. They don’t try to innovate and build the new world [ … ] If you don’t really innovate, I don’t know if this will yield that much.”

While Amazon’s acquisition of One Medical has been confirmed to be underway, the launch of their on-demand therapy has yet to be launched. According to Insiderwhich originally announced the launch, the product would be delivered through Amazon Care and was a way for the company to bolster its healthcare business.

Shakir and Aoun both agree that Amazon’s expansion creates new pressure for startups and investors to enter the space with a stronger offering.

“In the end, healthcare is undoubtedly a huge market opportunity, and the pandemic has shed light on its many inefficiencies and reliance on technology,” said Shakir. “Now that Amazon is on the market, a delightful consumer experience will be an essential must-have, not just a fun thing to have. While Big Tech will always play an important role in the healthcare ecosystem, groundbreaking innovation is more likely. comes from budding entrepreneurs who can collaborate with Big Tech at scale.”

Aoun explained that it is not necessary to keep up with Amazon, but to find ways to be creative in space.

“This actually opens up more opportunities for other players because now Amazon is frankly distracted by a strategy that won’t go far. Now you have a whole host of opportunities for everyone to get into the game,” he said.

As Amazon begins to deploy its healthcare services in a larger capacity, some asked questions about patient privacy data in light of recent events.

Talkspace and BetterHelp took the spotlight earlier this year when the US Senate asked these mental health app providers to clarify their data collection and sharing policies after reports suggested the companies could share data with Meta and google.

Shakir said Amazon needs to understand the space and accept that Big Tech companies have a “complicated relationship with healthcare”.

“One of the challenges of building a healthcare product is that it not only requires nuance – understanding clinical workflows and consumer habits – but also has to be built within specific constraints such as HIPAA, billing codes, EMR interoperability, etc.” . “This can be especially challenging when innovating within a large company that also has its own stakeholders and competing priorities.”

Other tech giants like Apple and Google have also ventured into healthcare.

While Apple hasn’t acquired a company, they have together with various healthcare providers to provide healthcare professionals with patient biometric data collected through an Apple Watch. To name a few features, a patient can track their heart rate, download apps to assist with neonatal care, and manage medication intake.

google on the other hand, more attention is being paid to the research side of health care. Collaborations at several universities have allowed them to expand digital wellness research, educate about suicide, and expand Fitbit features.

Bigger players focusing on healthcare could spur new entrants, but it could also push startups to explore aspects of the space that haven’t received much attention in the past, but could deliver significant improvements for both patients and payers.