The health care industry is becoming more interconnected as CVS Pharmacy stated they will acquire Oak Street Health for $10.6 billion by the end of this year on Feb. 1 and on Jan. 24, Amazon announced RxPass, a $5 prescription delivery service for Prime members.
Oak Street Health is a primary care provider endorsed by the American Association of Retired Persons, more commonly known as AARP, which specializes in treating older adults. Recently CVS has been expanding through multiple different outlets, and in January they invested $100 million in Carbon Health, a membership-free primary care provider. CVS will now be offering clinical services and is closer to becoming an all in one provider.
Amazon is using the same strategy and it was recently reported by the Wall Street Journal on Feb. 3 that they are being examined by the Federal Trade Commission (FTC) for antitrust violations. Official reports have yet to be released, but the FTC has been monitoring Amazon’s business practices for years to determine if they favor their own products over other vendors on their platform.
Along with their absorption of RxPass, Amazon acquired One Medical, a virtual care membership, in July of 2022 after shutting down Amazon Care. While acquisitions such as these can drive up product prices and temporarily stunt revenue, investors approve of them as absorbing other companies could bring a greater return of investment for Amazon in the long run because eliminating competition means consumers will have less options to shop elsewhere.