Shares of Teladoc Health (TDOC) - Get Report dropped Wednesday as telehealth stocks fell following news that Amazon.com's (AMZN) - Get Report health services ambitions were larger than previously thought.
The declines came following a report that said Amazon plans to offer primary care options to large employers through a mobile app that provides both in-person and online doctor visits as an extension of its Amazon Care business.
Amazon Care currently only is available to the company's own employees in pilot mode. Business Insider's report of its expansion plans sent telehealth stocks tumbling Wednesday.
Competition from Amazon "could further pressure the competitive landscape of the telehealth industry," Stephen's analyst Scott Schoenhause wrote in a note, according to Bloomberg. "We are becoming increasingly worried about competition in the space."
Last month, Amazon launched Amazon Pharmacy, a full-service digital pharmacy that lets Amazon Prime members order and fill their prescriptions online and have them delivered directly to their front doors.
Shoppers can pay using their health insurance. Prime members who don’t use their insurance are eligible for discounts on generic and brand-name drugs on Amazon’s site or at about 50,000 participating pharmacies, Amazon said.
Amazon officially moved into the U.S. drug space in 2018 when it acquired PillPack, and has been dabbling in introducing prescription medications to its marketplace in Japan with the support of local partners.
Amazon in January filed to trademark “Amazon Pharmacy” in Canada, according to the Canadian Intellectual Property Office website, signaling a potential move into selling prescription drugs outside the U.S. Similar trademark filings have also been made in the U.K. and Australia.