Amazon has elected 14-year company veteran Nader Kabbani to run and look after its new pharmacy initiative, which also includes the team of PillPack, an online pharmacy, which was bought by Amazon for more than $800 million last year.
The 14-year old veteran is now the vice president of consumables and special projects. He helped in building Amazon’s Kindle platform. He served as vice president in the logistics and Flex business.
In the United States, the pharmacy business has great potential for Amazon. More than 4 billion prescriptions are ordered every year, while it is expected that the spending will reach $600 billion in the next few years, much of that will be covered by Medicare and Medicaid.
The appointment of Kabbani shows that Amazon is leaving no stone unturned in putting its most ambitious project into the hands of a trusted executive with a vast amount of experience in supply chain and logistics. However, he has no background in medical, pharma or health care.
The online pharmacy and distribution industries have been watching Amazon’s closely.
After the collaboration of PillPack and Amazon, it has been found that the shares of pharmacies and drug distributors and pharmacies dropped steeply.
Pharmacy is an extremely challenging field, given the supremacy of brick-and-mortar pharmacies and the distributors that negotiate drug prices.
The vice president was the point person for buying PillPack. According to sources, Walmart was in talks with PillPack for months before the deal with Amazon.
Buying PillPack was Amazon’s entry into the $3.5 trillion health care industry. Amazon has been keeping an eye on the online pharmacy business for years. It has even started hiring a team in 2017.
Jonathan Schwartz, CEO of CareZone, an online pharmacy, said, “No matter how complicated health care may be behind the scenes, consumers see pharmacy as just another e-commerce category. They want modern digital experiences. Traditional providers ought to be rethinking their approach to customer retention.”
Since the deal, the PillPack team has remained quiet. So far, Amazon has not announced any plans for PillPack and has done little by adding a few medical products. The company already supplies OTC medicines, at-home DNA tests, and products such as bandages and gauzes. Kabbani is known to report to a former Procter & Gamble managing director, Sunny Jain, who is now Amazon’s vice president of consumables.