Pharmacies take a $10 billion hit as Amazon lands Whole Foods deal
The pharmaceutical supply chain is down by a total market cap of $10 billion, according to UBS.
In addition to the grocery stores whose stocks have been getting clobbered on the news, here are the drug industry companies that are also taking a hit.
- CVS, which owns pharmacies as well as operates a pharmacy benefit manager was down roughly 5%.
- Walgreens was also down 5%.
- The news also hit drug wholesalers Cardinal Health (down 2%), Amerisource Bergen (down 2%), and McKesson (down 2.5%).
- Express Scripts, one of the largest pharmacy benefit managers, was down about 1%.
It's not the first time the prescription drug industry has been concerned about Amazon entering the pharma business. CNBC reported in May that Amazon is seriously considering entering the pharmacy business, leading to speculation about what that might look like.
Whole Foods doesn't have a pharmacy, though it does sell vitamins and supplements. That means that Amazon's entrance into the pharmacy business, at least at a brick-and-mortar-level, might not be immediate.
"We recognize that the sheer establishment of a physical presence is likely to give pause to those more concerned by the Amazon risk but note that Whole Foods does not have pharmacy and therefore is less likely to serve as a specific conduit towards driving whatever Amazon's eventual pharmacy strategy might be," UBS said in a note.
