In this article, Amazon announced on Thursday that Prime members can now access new fixed pricing for the treatment of conditions such as erectile dysfunction and men’s hair loss. This move is seen as Amazon’s latest attempt to compete with other direct-to-consumer marketplaces like Hims & Hers Health and Ro.
Following this announcement, shares of Hims & Hers experienced a significant drop, closing down more than 24% on Thursday, marking the company’s worst day on record.
Amazon revealed in a blog post that Prime members will be able to view the cost of a telehealth visit and the desired treatment for five common issues before deciding to proceed with care. Treatment options include anti-aging skin care starting at $10 a month, motion sickness for $2 per use, erectile dysfunction at $19 a month, eyelash growth at $43 a month, and men’s hair loss for $16 a month. These services can be accessed using Amazon’s savings benefit Prime Rx at checkout.
In July 2022, Amazon acquired primary care provider One Medical for approximately $3.9 billion. This recent announcement further enhances Amazon’s existing pay-per-visit telehealth offering, where video visits cost $49 and messaging visits cost $29 where available. Users can seek treatment for over 30 common conditions, including sinus infections and pink eye.
Medications filled through Amazon Pharmacy are eligible for discounted pricing and will be delivered to patients’ doors in standard Amazon packaging. Prime members are required to pay for the consultation and medication without any additional fees, according to the blog post.
Bank of America analysts downgraded shares of Hims & Hers from buy to underperform on Thursday, attributing this decision to Amazon’s entry into the hair loss and erectile dysfunction markets. The analysts noted that Hims & Hers derives over 80% gross margins from its core offerings in erectile dysfunction and hair loss, estimating that Amazon’s medications for these conditions are approximately 42% and 29% cheaper, respectively.
As a consequence, the analysts believe that Amazon’s presence will restrict the prices that Hims & Hers can charge and impede the company’s ability to attract new customers.
Amazon has been striving to establish a foothold in the lucrative health-care sector for several years. The company launched its online pharmacy in 2020 following the acquisition of PillPack in 2018. Amazon also introduced and later discontinued a telehealth service called Amazon Care, along with a line of health and wellness devices.
Additionally, CNBC reported on Wednesday that Amazon had terminated a secretive project aimed at developing an at-home fertility tracker.
This report includes contributions from CNBC’s Annie Palmer.
