Amazon will enter the Japanese prescription drug market next year

According to reports, people familiar with the matter said today that Amazon is considering entering the Japanese prescription drug market. This could be a turning point for brick-and-mortar pharmacies in Japan. Amazon plans to partner with small and medium-sized pharmacies in Japan to create a platform for selling prescription drugs, people familiar with the matter said. After placing an order online, users can sit at home and wait for delivery. Through the platform, patients can also receive online instructions on how to take their medications.

Amazon plans to launch the service next year, when e-prescribing will be legal in Japan. Of course, Amazon doesn't operate its own pharmacy. Instead, Amazon will invite small and mid-sized pharmacies to sell prescription drugs online, and delivery will be provided by Amazon.

Amazon declined to comment.

This change will allow patients to receive medical care online or obtain electronic prescriptions after visiting a medical facility in person. They can then order medicines from Amazon's online pharmacy. The pharmacy will be responsible for dispensing the medication and providing patients with online instructions on how to take the medication. And Amazon’s delivery network will bring medicines from pharmacies to patients’ homes.

After the pandemic, Japan began to allow online medical care, online instruction on how to take prescription drugs, and preliminary patient consultations. This spring, the measures took effect permanently. Next, as e-prescribing became legal, it became possible to provide complete online medical services.

Since the price of prescription drugs in Japan is fixed, the out-of-pocket costs (excluding shipping) for patients who purchase drugs online will not vary much. As a result, pharmacies located near a patient's home can quickly ship to buyers. Through the platform, Amazon can refer consumers to pharmacies that can meet their needs.

As of fiscal 2020, about 60,000 pharmacies in Japan dispense prescription drugs. Over the past decade, that number has increased by about 10 percent. If online sales become common, traditional pharmacies that rely on locational advantages to do business could face stiff competition.