Amazon.com, Inc. (NASDAQ: AMZN) is now preparing itself to offer a larger medical supplier business, according to the Wall Street Journal. The business segment will supply major U.S. hospitals and clinics.
Amazon’s initiative is to expand its Amazon Business marketplace by adding on a healthcare segment, according to hospital executives that were invited to Amazon’s headquarters. The marketplace will be stocked to equip outpatient clinics, operation room and emergency rooms.
The reports of Amazon expanding its healthcare segment caused healthcare supplier companies McKesson, Cardinal Health and Owens & Minor’s shares to all fall. Owens & Minor’s share fell by 7 percent, Cardinal fell by 4 percent, and McKesson fell by 2 percent.
Amazon has been causing disruption all across the healthcare market. The eCommerce tech giant has spent the past year expanding itself into healthcare.
In Owens & Minor last earnings call in November, chief executive Cody Phipps described Amazon as a “formidable competitor” in any type of distribution business.
Owens & Minor did not respond to comments, while McKesson and Cardinal declined to comment on the matter.
Last year, there were reports on Amazon looking to launch its own pharmaceutical subsidiary and then by the end of year, the company was granted a wholesale distribution licenses in several states.
Last month, Amazon entered into a partnership with J.P. Morgan Chase and Berkshire Hathaway to discuss cutting costs for healthcare as well as improving it for their employees.
Amazon isn’t the only company looking to bolster its position in the healthcare market. Rising costs of healthcare has caused many companies in the market to look into possible acquisitions or mergers in order to combat it.
CVS reached a $69 billion to acquire Aetna to overcome increased healthcare spending through lowered costs in medical services in pharmacies.
While, Walgreens is reportedly looking to acquire AmerisourceBergen entirely or segments of the company to boost its profitability. Although, sources say there is a chance the deal may not happen. Walgreens already has a 26 percent stake in Amerisource.