Shares of pharmacy giants CVS Health (CVS) - Get Report, Walgreens Boots Alliance (WBA) - Get Report and Rite Aid (RAD) - Get Report all traded lower on Tuesday after Amazon announced the official opening of Amazon Pharmacy, its new full-service digital pharmacy for Prime members.
The offering puts Amazon in direct competition with the the pharmacy chains, and also puts it head to head with Walmart (WMT) - Get Report, Target (TGT) - Get Report and other big-box stores that already sell prescription drugs.
Amazon Pharmacy comes more than two years after Seattle-based Amazon's $753 million acquisition of PillPack, an online pharmacy known for organizing pills into packets that also delivers drugs directly to consumers’ homes.
Ir also comes as consumers continue to shun physical stores and order items online, a trend the coronavirus pandemic continues to reinforce, though Amazon has been looking at moving into the pharmacy drug business for some time.
Amazon this past 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.