Amazon failed to disrupt the prescription drug business with Drugstore.com. Could a second try succeed?
The headlines, spurred by Amazon’s entry into the pharmacy business, were as entertaining as they were exuberant. One hailed the company’s 1999 investment in Drugstore.com as “a likely gold mine.” In Canada, the Globe and Mail predicted a sea change in shopping habits, titling its story: “Farewell, Preparation H aisle.”
Nearly 20 years later, shoppers are still awkwardly perusing that aisle and getting their prescription drugs from many of the same bricks-and-mortar pharmacies. Drugstore.com no longer exists and never recorded an annual profit.
It turned out that the pharmacy business, especially in the United States, was harder to disrupt than Amazon and its partners had predicted. Amazon is much bigger now and has built a selling over-the-counter medicines and other products. But if it launches a second foray into prescription drugs, as it appears to be considering, the online behemoth would face many of the same obstacles that derailed the
