I do not trust Amazon with this type of product at all. Their lack of ability or interest in stopping counterfeits now fills me with wary about products that are important to me.
That's insane. I don't see Walgreens or CVS to be any more competent than Amazon. It's the regulations that's keeping them straight. I'm really really hoping that this brings down the cost of medicines. The pricing of drugs in the US is ludicrous.
They definitely have an interest in stopping counterfeits if it makes them liable for injuries or other lawsuits (e.g. fake chargers, cables, hoverboards, eclipse glasses).
AmerisourceBergen and Cardinal Health have current contracts with Walgreens.
Amazon is trying to reach a 1:1 relationship with generic producers so they can skip purchasing from a vendor, reducing costs. In this effect they would have an advantage over Walgreens, CVS, or Rite-Aid.
If Amazon really wanted to they could distribute for one of the aforementioned pharmacy chains as well, provided they are approved by the FDA & DEA.
I'd be interested in knowing what different pharmacies ultimately charge the various insurance companies for generic drugs.
During a job switch I had a couple of weeks were I was covered, but before I got my new insurance ids I paid full price (then reimbursed in full afterward.)
A very common generic drug I had a $10 co-pay for, was $139 without insurance at the chain pharmacy I went to. Is this ultimately what the insurance company is paying out?
I was shocked. I thought the generic would be mass-produced and only cost, maybe, a few dollars over my $10 co-pay. I suppose of that $139 dollars, only a tiny fraction was the actual drug price; the rest goes into salaries for the pharmacists, business costs and profit. It still seemed pretty outrageous to me.
If a company like Amazon ends up only charging back to the insurance company a lot less, on a mass scale, it would hopefully reduce overall insurance costs.
> Is this ultimately what the insurance company is paying out?
No not at all. “Self pay” was your status and those people pay the highest rates. This is true for almost all US healthcare. Being self pay is basically like going to a car dealer and paying MSRP with no negotiation or rebates, etc.
The pharmacy has agreements with wholesalers (sometimes directly with manufacturers) that determines their cost structure of inventory. This includes discounts and rebates and a lot of other cost reductions but All these drugs have sticker price. Insurance companies drive volume and can decide which pharmacies their patients use, thus they can negotiate prices as well. The pharmacy<>insurance transaction is usually going through a PBM, another middle man, that can tell them pretty much instantly what you owe based on your coverage (this is why a pharmacy can give you accurate pricing but doctors offices can’t). There’s a lot of intricacies but the difference between self pay and insured rates can significant. For a generic, I’d be surprised if the pharmacy paid more than 5-20$ but billed you what they could. When insured and you pay 10$, the insurance company has done the math that they will profit on their total generic base even if they lose a little on your purchase (but they probably didn’t).
I work in healthcare finance currently at a pharmacy
$139 is almost certainly not what the insurance company would pay. It's also largely a price determined by the pharmacy itself, not the drug manufacturer.
> Is this ultimately what the insurance company is paying out?
They get insanely large profit margin and its pretty much a result of years of lobbying and hard-to-get-in type of market. You are absolutely right with your hopes and when Amazon finally kicks in you will see massive "discounts" from Wallgreens CVS etc al... while they will still rack up nice profits! The whole idea behind Amazon looking deep into disturbing this market is exactly the fact how much lobbying and deals-behind-the-curtain are being made jack up the pricing.
PS. A friend of mine works high in ranking in Wallgreen and all upper management is truly losing sleep over this.
PS2. Same situation applies to aviation. All major players are in shenanigans in price gauging (they simply agree NOT to lower the price) that's why the price of oil went down over 50% meanwhile your average ticket went up 15%. With so much money on hands, I would hope Amazon will eventually disturb flying market in USA; we need it.
Consumers never benefit when there's only a single middleman. Have you not heard of robber barons? Or looked at the effects of a monopoly in an economics class?
Amazon no longer reliably has the lowest price on items, instead relying on the reduced friction of Prime to get people to pay more.
Amazon also has questionable quality and reliability these days with co-mingled inventory, 3rd party sellers, and reviews that are impossible to determine the authenticity of.
Please enlighten me as to how "consumers will only benefit."
Wonder if this would be able to solve the problem of price fixing, which has lately become an issue. People think that generic drugs equal cheaper drugs but companies can still manipulate prices to benefit themselves.
I can only hope that they take steps to control "additives" in pills. My mother (and probably her mother) are allergic to some of the additives in the pill, to the utter disbelief and dismay of many doctors.
I'd take Chinese manufactured drugs if it breaks the current hegemony. I already buy stuff from India from sketchy online pharmacies, having some semi-trustworthy body providing any oversight would be a an improvement.
Likely not. It'll most likely be India as they are the largest generics manufacturing nation by far. India is to generic drugs what we are to non-generics. Israel is another major generics manufacturer so it could be them. China's pharmaceutical market haven't developed as quickly because of their internal chinese medicine market.
I completely trust Amazon with this product. They have shown the ability to run complex systems at a high quality. I think they can only improve the availability of medicine.
Just because counterfeits still happen doesnt mean they are not trying to stop nor does it mean they are doing a bad job.
And Im sure there will be further regulations around this then there is for nockoff plastic goods.
I am not normally a conspiracy theorist but Amazon manufacturing things to spy on me with audio, video, being able to unlock my doors and now know my prescriptions, naaah.
[+] [-] ProAm|8 years ago|reply
[+] [-] 8ytecoder|8 years ago|reply
[+] [-] doughj3|8 years ago|reply
[+] [-] paxy|8 years ago|reply
[+] [-] paulcole|8 years ago|reply
[+] [-] unknown|8 years ago|reply
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[+] [-] pcurve|8 years ago|reply
[+] [-] draw_down|8 years ago|reply
[deleted]
[+] [-] jlkjasldk|8 years ago|reply
Amazon is trying to reach a 1:1 relationship with generic producers so they can skip purchasing from a vendor, reducing costs. In this effect they would have an advantage over Walgreens, CVS, or Rite-Aid.
If Amazon really wanted to they could distribute for one of the aforementioned pharmacy chains as well, provided they are approved by the FDA & DEA.
[+] [-] refurb|8 years ago|reply
[+] [-] pcurve|8 years ago|reply
In order to sell drugs to people, you need pharmacy license in each state.
[+] [-] xefer|8 years ago|reply
During a job switch I had a couple of weeks were I was covered, but before I got my new insurance ids I paid full price (then reimbursed in full afterward.)
A very common generic drug I had a $10 co-pay for, was $139 without insurance at the chain pharmacy I went to. Is this ultimately what the insurance company is paying out?
I was shocked. I thought the generic would be mass-produced and only cost, maybe, a few dollars over my $10 co-pay. I suppose of that $139 dollars, only a tiny fraction was the actual drug price; the rest goes into salaries for the pharmacists, business costs and profit. It still seemed pretty outrageous to me.
If a company like Amazon ends up only charging back to the insurance company a lot less, on a mass scale, it would hopefully reduce overall insurance costs.
[+] [-] conductr|8 years ago|reply
No not at all. “Self pay” was your status and those people pay the highest rates. This is true for almost all US healthcare. Being self pay is basically like going to a car dealer and paying MSRP with no negotiation or rebates, etc.
The pharmacy has agreements with wholesalers (sometimes directly with manufacturers) that determines their cost structure of inventory. This includes discounts and rebates and a lot of other cost reductions but All these drugs have sticker price. Insurance companies drive volume and can decide which pharmacies their patients use, thus they can negotiate prices as well. The pharmacy<>insurance transaction is usually going through a PBM, another middle man, that can tell them pretty much instantly what you owe based on your coverage (this is why a pharmacy can give you accurate pricing but doctors offices can’t). There’s a lot of intricacies but the difference between self pay and insured rates can significant. For a generic, I’d be surprised if the pharmacy paid more than 5-20$ but billed you what they could. When insured and you pay 10$, the insurance company has done the math that they will profit on their total generic base even if they lose a little on your purchase (but they probably didn’t).
I work in healthcare finance currently at a pharmacy
[+] [-] blaisio|8 years ago|reply
[+] [-] joering2|8 years ago|reply
They get insanely large profit margin and its pretty much a result of years of lobbying and hard-to-get-in type of market. You are absolutely right with your hopes and when Amazon finally kicks in you will see massive "discounts" from Wallgreens CVS etc al... while they will still rack up nice profits! The whole idea behind Amazon looking deep into disturbing this market is exactly the fact how much lobbying and deals-behind-the-curtain are being made jack up the pricing.
PS. A friend of mine works high in ranking in Wallgreen and all upper management is truly losing sleep over this.
PS2. Same situation applies to aviation. All major players are in shenanigans in price gauging (they simply agree NOT to lower the price) that's why the price of oil went down over 50% meanwhile your average ticket went up 15%. With so much money on hands, I would hope Amazon will eventually disturb flying market in USA; we need it.
[+] [-] deegles|8 years ago|reply
[+] [-] hristov|8 years ago|reply
[+] [-] sushid|8 years ago|reply
[+] [-] shostack|8 years ago|reply
Amazon also has questionable quality and reliability these days with co-mingled inventory, 3rd party sellers, and reviews that are impossible to determine the authenticity of.
Please enlighten me as to how "consumers will only benefit."
[+] [-] stuffedBelly|8 years ago|reply
[+] [-] danmaz74|8 years ago|reply
[+] [-] rangersanger|8 years ago|reply
[+] [-] camus2|8 years ago|reply
[+] [-] srathi|8 years ago|reply
[+] [-] Lordarminius|8 years ago|reply
[+] [-] donarb|8 years ago|reply
https://www.reuters.com/article/us-usa-generics/u-s-states-a...
[+] [-] ungzd|8 years ago|reply
[+] [-] jenkstom|8 years ago|reply
[+] [-] amelius|8 years ago|reply
[+] [-] WillPostForFood|8 years ago|reply
[+] [-] eighthnate|8 years ago|reply
[+] [-] j4ship|8 years ago|reply
Just because counterfeits still happen doesnt mean they are not trying to stop nor does it mean they are doing a bad job.
And Im sure there will be further regulations around this then there is for nockoff plastic goods.
[+] [-] madamelic|8 years ago|reply
I am not normally a conspiracy theorist but Amazon manufacturing things to spy on me with audio, video, being able to unlock my doors and now know my prescriptions, naaah.
[+] [-] msmm|8 years ago|reply
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