Amazon Shuts Down Amazon Care In ‘Strategic’ Healthcare Move

Amazon may be shutting down its Amazon Care health venture in order to refocus after agreeing to buy medical network One Medical in July for $3.9 billion (£3.33bn), according to industry watchers.

Neil Lindsay, head of Amazon Health Services, announced the move in a memo to employees last week, saying the venture was “not a complete enough offering” for the large enterprise customers that had been targeted and “wasn’t going to work long-term”.

The company said it had determined the Amazon Care business model wasn’t working prior to, and independently of, its deal to buy One Medical, which is still moving ahead pending regulatory approval.

“This decision wasn’t made lightly and only became clear after many months of careful consideration,” Lindsay said in the memo.

Strategy

But analysts noted that there may have been areas of significant overlap between Amazon Care and One Medical, and that One Medical was already well-established in many of the aspects that Amazon Care was seeking to build from scratch.

One Medical has contracts with large enterprises, offers telemedicine, and has an established network of physicians, said OMERS Ventures health-tech investor Chrissy Farr.

“It could be a signal of where Amazon plans to focus its energies,” Farr said in a research note, adding that she did not have first-hand knowledge of the reasons for the decision.

Analyst Natalie Schibell at Forrester Research agreed, telling the Financial Times that the closure was a “strategic move” and not a “sign of failure” as the company continues to expand into the US healthcare sector.

Virtual care

Amazon Care offered access to a doctor, nurse or other health practicioner on demand, 24 hours a day.

It included virtual, in-home and urgent care services, without bricks-and-mortar clinics or physical locations.

The offering was launched in 2019 for its employees in the Seattle area, expanding nationwide to non-employees last year.

Amazon is reportedly one of the bidders for home healthcare provider Signify Health, a deal that could attract scrutiny from the the Federal Trade Commission (FTC) on antitrust grounds.