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Even Amazon will have a tough time disrupting health care

 2 years ago
source link: https://finance.yahoo.com/news/even-amazon-will-have-a-tough-time-disrupting-healthcare-181337510.html
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Amazon to shutter Amazon Care as it pivots to other telehealth acquisitions
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Even Amazon will have a tough time disrupting health care

Alexandra Garfinkle
·Senior Reporter
Sat, August 27, 2022, 3:13 AM·6 min read
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Amazon (AMZN) this week announced its plans to shutter Amazon Care, its telehealth offering. The timing doesn’t seem like an accident — the tech giant recently announced its $3.9 billion acquisition of primary care provider One Medical (ONEM), which offers, among other things, broad telehealth capabilities and a substantial footprint of in-person clinics.

Amazon’s health care deals are important enough to merit headlines, sure. But, in the scheme of a highly regulated and competitive industry, Amazon still has a long way to go when it comes to being a major player, some experts say. That group includes Susan Lang, CEO of XIL Health, a health care-focused analytics and tech company.

“Amazon is typical of many tech giants who considered disrupting health care,” she said. “In general, they grossly underestimate how difficult and complex the $4 trillion health care industry is to disrupt. So in terms of their importance in health care, they are still not a significant factor, especially in the delivery of actual care, which is where Amazon Care sat.”

A number of tech giants, including Amazon, and corporate stalwarts have attempted to move into health care in recent years with varying degrees of success. For example, Apple (AAPL) has in recent months shown signs of doubling down on the health-related applications of its Apple Watches, even publishing a report on its health care plans. Amazon, for its part, has been making health care deals for years, acquiring PillPack in 2018, and even partnering with JPMorgan Chase and Berkshire Hathaway on a health care initiative called Haven, which shuttered last year.

Physician John Jones, D.O. tests administrative assistant Morgan Bassin for the coronavirus disease (COVID-19) at One Medical in Scottsdale, Arizona, U.S. June 17, 2020. One Medical employees receive testing every two weeks.   REUTERS/Courtney Pedroza
Physician John Jones, D.O. tests administrative assistant Morgan Bassin for the coronavirus disease (COVID-19) at One Medical in Scottsdale, Arizona, U.S. June 17, 2020. One Medical employees receive testing every two weeks. REUTERS/Courtney Pedroza

This year, Amazon’s been looking to make deals in quick succession in health care and beyond. Recently, the company also acquired Roomba-maker iRobot and is reportedly bidding for home health services company Signify Health (SGFY).

However, it’s still important to remember that, from a deal-making perspective, Amazon’s acquisition of One Medical is significant because it’s Amazon — not because the deal is by definition re-making the health care landscape, said Arjun Kapur, managing director of VC firm Forecast Labs.


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