Will Amazon disrupt the UK community pharmacy market?

March 21, 2018

 

As part of C+D’s internet pharmacy week, NHS Digital’s Mohammed Hussain considers whether the Amazon takeover is round the corner

 

Amazon’s virtual assistant Alexa can do many things, including laughing randomly, which is sure to freak people out. Each week, the company sends out an update email to show the latest skills Alexa has learned. As yet, Alexa can’t order your repeat prescription.

 

Amazon has, however, signaled an entry into the pharmacy and healthcare sectors. The company is exploring providing distribution and fulfillment of orders, pharmacy licensing to comply with regulation, and has even introduced its own-brand over-the-counter pharmacy line.

 

Is pharmacy about to be ‘Amazonised’?

 

Here are three reasons why it could be:

  1. Other, similar, industries have all been disrupted by digital technologies: groceries, book shops, video rental and banking, to name a few.

  2. Citizens are increasingly moving online for services. They expect to be able to conduct digital interactions and not have to receive services on a solely face-to-face basis.

  3. Citizens expect to have 24/7 ability to interact with a provider, both synchronously (phone, chat, Skype) and asynchronously (NHS mail, app messaging).

If this were the whole picture, then pharmacy would have already been significantly disrupted.

This has not been the case, so this is not the whole picture.

 

 

Why pharmacy may not be ‘Amazonised’:

  1. Pharmacy services are much, much more than a simple transactional interaction. Pharmacy provides access to a trained and regulated health professional, adds clinical value, ensures safety, and provides tailored help and advice – all with or without the supply of a product.

  2. It has not happened yet – which underlies that healthcare is different. The regulatory environment in healthcare is complex and has not yet fully kept pace with technology.

  3. The digital infrastructure is not sufficiently mature in pharmacy. This constrains the ability for software to deliver the service. A decade on from the launch of the electronic prescription service, it is clear this has been less transformational and more foundational for disruption. A structured, computer-readable dose syntax has not been developed. Sharing of data is still hard, and interoperable systems remain in their infancy.

  4. Medicines are not just another commodity. A medicine is not like a book or loaf of bread. Although they can be ordered and shipped, they are fundamentally different. Safeguards to prevent abuse or harm need to be included, and individual wants have to be balanced against protecting the individual and the wider public interest. Inappropriate use of medicines, such as antibiotics, can have a population-level effect and, as such, additional care is needed to ensure the wider public health interest is considered.

Amazon will undoubtedly enter the pharmacy sector in some capacity. However, my own judgement is that the greater disruption will come from [prescription ordering] pioneers such as Echo and Dimec, as they bring in new business models with two-sided network effects that are more rapidly scalable.

 

Two-sided networks are platforms where two sets of users can conduct transactions with one another, and the value of the platform grows in a 'virtuous circle' as providers and consumers grow. Examples include Airbnb (hosts and guests), app stores (developers and purchasers), and Uber (drivers and riders).

 

While we wait for the disruptive models to scale, the one thing that can’t be outsourced (yet) is exercise: “Alexa – start my seven-minute workout!”

 

Mohammed Hussain is senior clinical lead of operations and medicines at NHS Digital.

 

 

Source : https://www.chemistanddruggist.co.uk/opinion/digital-online-amazon-disrupt-takeover-uk-community-pharmacy

 

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