CVS Health CEO: Amazon, others face 'many barriers to entry' into pharmacy

During a second-quarter earnings call Aug. 8, Woonsocket, R.I.-based CVS Health President and CEO Larry Merlo said the "barriers to entry are high" for companies like Amazon that may be looking to move into the pharmacy business, Forbes reports.

Mr. Merlo addressed speculation that Amazon may consider moving into the pharmacy space after its $13.4 billion purchase of Whole Foods in June. He noted while pharmacies serve as a distribution point for patients to receive their medication, they also provide the clinical prowess to help patients manage their care, a facet that will become increasingly important as healthcare transitions toward a value-based care model.

For Amazon to be successful, he said, the company would have to build stronger ties to local communities. However, if the retail giant did decide to enter the pharmacy realm, Mr. Merlo said CVS Health "[has] a lot of capabilities and a value proposition that can compete effectively in the market," according to the report.

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