There’s an old saying about how people don’t like big box stores. “I won’t buy my groceries where I buy my tires,” or some equally incongruous pair of items. But are people ready to buy their prescription medications where they buy their lawn furniture online? Amazon (NASDAQ:AMZN) is counting on the answer being “yes,” because that’s the move they’re making. Investors aren’t enthusiastic, as the stock is down slightly going into Tuesday afternoon trading.
The move is called RxPass, and it’s an additional feature to Amazon Prime. For $5 extra per month, Amazon Prime members can have eligible generic medications mailed right to their doors. So far, RxPass covers 50 different generic medications which cover a wide range of chronic conditions from diabetes to high blood pressure. Further, those who sign up for RxPass can also get in on Amazon Pharmacy, which opens up access to other prescription medications. Perhaps best of all, RxPass doesn’t accept any kind of insurance.
This isn’t Amazon’s first time getting involved in the healthcare field. Back in 2018, Amazon acquired PillPack and picked up One Medical last year as well. Then, Amazon joined a coalition of companies to form Haven, a failed project which attempted to offer healthcare management tools. Amazon’s attempt to become part of the ranks of healthcare stocks hasn’t always worked out well, but this time, it might pull off a win.
Regardless, Amazon’s massive market power makes it attractive to Wall Street. Analyst consensus calls Amazon stock a Strong Buy with an average price target of $133.04, giving it 37.13% upside potential.