Amazon just spent billions to try and replace your doctor
Amazon has announced it is set to buy US firm One Medical in its latest foray into the healthcare industry.
The San Francisco-based firm operates 182 medical offices in 25 markets across the US, offering digital health services, including access to its own physicians, in exchange for a subscription fee.
The all-cash acquisition has a value of around $3.9 billion according to a statement by Amazon, at a cost of around $18 a share, inclusive of the company’s existing debt.
What does this mean?
“Booking an appointment, waiting weeks or even months to be seen, taking time off work, driving to a clinic, finding a parking spot, waiting in the waiting room then the exam room for what is too often a rushed few minutes with a doctor, then making another trip to a pharmacy – we see lots of opportunity to both improve the quality of the experience and give people back valuable time in their days,” said Neil Lindsay, senior vice president of Amazon Health Services.
The company was fairly tight-lipped regarding what its long-term plans are surrounding the acquisition, other than saying “health is high on the list of experiences which need reinvention”.
This isn’t the first time that Amazon has dipped its toes into the world of healthcare, as it has its Amazon Care program that allows employees to access healthcare facilities without leaving their home, either remotely via chat or video conferencing (opens in new tab) or in-person for blood tests or for delivering prescriptions.
Amazon purchased online pharmacy PillPack for $750m in 2018 prior to launching an online drug store of its own.
Completion of the transaction is still pending approval by One Medical’s shareholders as well as regulatory approval.
It’s likely there is wider strategic importance, however, as the latest buy-out is one of the largest purchases made by a company known for them.
The size of the deal is the third biggest in the company’s history, falling behind the $13.7bn it spent to buy Whole Foods in 2017 and the $8.5bn it forked out to purchase Hollywood studio MGM.
Remote healthcare was of the beneficiaries of the pandemic; One Medical claims to currently serve 767,000 customers, up 28% year-over-year, and went public in January 2020.