Amazon’s license stumble shows inexperience in pharmacy

Amazon’s arrange for the pharmaceutical space is one of the biggest questions in healthcare. However the tech giant’s inexperience in the area could be revealing itself, relating to analysts at RBC.

Tuesday, RBC Capital Markets analysts advised that the cancellation of pharmaceutical wholesaler license applications in Maine may imply that Amazon doesn’t plan to enter the space.

But Wednesday, the analysts said it’s become apparent that the talk about, not Amazon, did the cancelling, because of the applications not getting complete by a good Dec. 1 deadline.

“Our key takeaway out of this knowledge is that Amazon will need to endure the same learning curve and regulatory hurdles found in the area as any other business,” RBC analysts George Hill, Stephen Hagan and Lee Lueder wrote found in a research note. “The Maine knowledge reminds us that despite its mystique, Amazon is not immune to making blunders or infallible.”

Amazon hasn’t commented on what, if any, programs it may need to compete found in the pharmaceutical space, but speculation about its access has weighed heavily on stocks of retail pharmacies, drug distributors and pharmacy benefits managers.

In October, the St. Louis Post-Dispatch reported Amazon possessed acquired pharmaceutical wholesaler licenses in several states, but authorities quickly described the licenses reinforced existing businesses rather than a new area of prescription drugs.

RBC suggested Tuesday that the Maine licenses is actually a leading indicator of Amazon’s plans found in pharmaceuticals, because the state doesn’t need a medical system license for the sales of medical supplies; as a result, RBC suggested, Amazon’s program there may have advised the licenses had been for prescription medicines.

Wednesday, RBC described the cancelled Maine applications mainly because “evidence of inexperience,” pointing out it couldn’t find evidence of Amazon filing subsequent pharmacy licenses in the talk about.

“The consensus is that Amazon’s other healthcare related licenses happen to be for the device and supply distribution,” the analysts wrote Wednesday. “Amazon will not need a license because of this occupation in Maine, only for drugs. This would clarify why Amazon abandoned the license method.”

Most are skeptical Amazon will need over such a heavily regulated industry; Walgreens Boot footwear Alliance CEO Stefano Pessina stated as many at the Forbes Healthcare Summit last week.

“Maine’s action implies that Amazon faces many issues entering the pharmacy distribution and reimbursement program,” stated Adam Fein, of Pembroke Consulting. “The medicine industry is much harder to disrupt than direct-to-client retailing or business-to-business stations for finished products.”

RBC’s analysts suggested the same, noting Wednesday that “Amazon’s intentions for the medicine supply chain will be the subject matter of obsession at this stage”- but nonetheless are no more clear.

Amazon didn’t immediately respond to a request for comment.

Read more on: http://www.cnbc.com/technology