Amazon Shifts Employees To PillPack And PBM RxAdvance

Amazon is making a bigger move into pharmacy by moving thousands of employees and their prescription benefits to a new cloud-based pharmacy benefit manager, RxAdvance, and Amazon’s own PillPack online pharmacy.

The move is being viewed by some as the latest effort by Amazon to tap into the healthcare business by first testing a new way to control prescription costs and improve medication adherence for its U.S. employees.

Amazon more than two years ago announced plans to launch a new venture with Warren Buffett’s Berkshire Hathaway and JPMorgan Chase to improve healthcare for the more than 1 million employees of all three giant corporations. Also in 2018, Amazon bought the online pharmacy PillPack and gained a valuable regulatory entry point into the growing U.S. prescription business.

Websites for Amazon employees are notifying the online retailer’s workers in certain markets this month, welcoming them to new drug benefit choices. A spokeswoman for Pillpack by Amazon Pharmacy confirmed it would be involved in the switch, saying “PillPack is an in-network pharmacy with RxAdvance, as described on the website, and we look forward to serving their members.”

Neither Amazon nor RxAdvance would comment. Premera Blue Cross, which provides medical benefits to many Amazon employees, had no comment on Amazon’s decision to change prescription benefits. Neither Cigna nor Express Scripts, Amazon’s current PBM for its employees, would comment.

The decision is for now considered a pilot for some Amazon employees, sources familiar with Amazon’s move say. In four states, Amazon employees are being offered information on how to make the switch from Express Scripts.

“On April 1, 2020, RxAdvance will replace Express Scripts as the prescription plan for Amazon employees with Premera Blue Cross medical coverage working in the following states: DE, FL, KS, and NV,” a website for employees says. “On this site, you will be able to learn more about what drugs are covered, how much they will cost, and which pharmacies are in-network.”

The loss of the Amazon business is for now not a big loss for Cigna, which owns Express Scripts, but it shows the intensifying competition for employer drug benefits. PBMs are the middlemen between drug makers and patients when it comes to purchasing drugs in bulk and leveraging their buying clout to negotiate better discounts for consumers and employers on their prescriptions.

Sources familiar with Amazon’s move say more than 10 PBMs received requests for proposals for the Amazon employee drug benefits including Express Scripts, CVS Health’s Caremark PBM and UnitedHealth Group’s OptumRx.

RxAdvance is growing rapidly as a cloud-based PBM. Health insurer Centene, for example, has begun in the last year shifting its health plan subscribers to the cloud-based RxAdvance. “This is a national full service cloud-based PBM that manages standard and specialty drug benefits with unmatched compliance and transparency,” Centene CEO Michael Neidorff said of RxAdvance during an April 2019 earnings call with analysts.