Amazon’s Latest Ambition: To Be a Major Hospital Supplier
Amazon is pushing to turn its nascent medical-supplies business into a major supplier to U.S. hospitals and outpatient clinics that could compete with incumbent distributors of items from gauze to hip implants.
Amazon has invited hospital executives to its Seattle headquarters on several occasions, most recently in late January, to solicit information about the sector and sound out ideas for expanding the company’s business-to-business marketplace, Amazon Business, into one where hospitals could shop to stock outpatient locations, operating suites and emergency rooms, according to hospital executives who attended the meetings.
Amazon Business already sells a limited selection of medical supplies—some sutures, for example, but not more specialized items like hip implants—as well as industrial and office supplies.
Amazon recently dispatched employees to a large Midwestern hospital system, where hospital officials are testing whether they can use Amazon Business to order health-care supplies for the hospital system’s roughly 150 outpatient facilities, according to a hospital official overseeing the efforts.
The pilot is customized for the hospital system’s catalog of supplies, the official said, allowing employees to compare prices the hospital negotiates with its distributors against those in the Amazon Business marketplace.
In response to questions about these efforts, Amazon said it is building technology to serve health-care customers, and seeking to sell hospitals on a “marketplace concept” that differs from typical hospital purchasing, which is conducted through contracts with distributors and manufacturers.
By Melanie Evans & Laura Stevens | The Wall Street Journal