Amazon crunches One Medical for $3.9 billion

By acquiring One Medical and its digital healthcare and services platform, Amazon is strengthening itself in the medical sector. A diversification strategy on the tracks of acquisitions already made in food distribution and cinema.

Amazon is continuing its diversification strategy and shopping for billions of dollars. After the organic restaurant chain Whole Foods Market bought in 2017 for $13.7 billion, the mythical MGM film studio a few months ago for $8.45 billion, it’s the turn of the primary health care network One Medical to come under the control of the American giant. This acquisition was made for an amount of 3.9 billion dollars – or $18 per share representing a capital gain of 75% compared to the last price – debt buyback included. Following this acquisition, Amir Dan Rubin, current CEO of One Medical, is confirmed in his functions.

By getting its hands on One Medical, Amazon is strengthening its Health Services division, including the Care activity with telemedicine services, but also orders and delivery of pharmacy products, health insurance… “This leaves no one doubt about Amazon’s seriousness in healthcare,” commented Paddy Padmanabhan, Founder and Managing Director of Damo Consulting. “For One Medical, the acquisition by Amazon provides an excellent path to sustained growth in a market where the battle for primary care is heating up and major healthcare systems are stepping up their consumer digital efforts to focus on growth. and retention”.

In search of reinventing health care and services

With 125 locations in the United States, One Medical was launched in 2007 in San Francisco. It offers access to places of care but also focuses a large part of its activity on risk prevention. The group, which bases its business model on an annual subscription at $199, has already been adopted by more than 765,000 people as well as companies such as Airbnb, Lyft, Zendesk, ING and Google. One Medical relies on a hybrid mode of activity by mixing face-to-face consultations coupled with 24/7 digital healthcare services via its platform. This includes, for example, the management of laboratory results and prescriptions, making appointments, teleconsultations, etc.

“We believe healthcare is high on the list of experiences that need to be reinvented,” said Neil Lindsay, senior vice president of Amazon’s Health Services business. “Making an appointment, waiting weeks or even months to be seen, missing work, going to a clinic, finding a parking space, waiting in the waiting room and then in the examination room for minutes too often rushed with a doctor, then take another trip to a pharmacy – we see many opportunities to both improve the quality of the experience and give people back valuable time in their days.” Even if the company claims to place people at the heart of its strategy by making the cost more accessible, it remains a for-profit company. In 2021, its revenues were $254.1 million, up 109% year-on-year.

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