Amazon’s deal to buy One Medical for $3.9 billion, a test for US lawmakers and regulators vowed to curb the power of big tech
Amazon has announced plans to buy healthcare provider in San Francisco a medical for $3.9 billion (£3.24 billion), in a deal that is likely to be a test for regulators and legislators, many of whom have declared their desire to curb the market power of the largest tech companies.
The all-cash scheme is intended to promote the company’s move into the medical industry, which is more than 20 years old.
The e-commerce giant said last week it would pay One Medical shareholders $18 a share, more than 75 percent more than Wednesday’s closing price. Shares of One Medical closed 69 percent higher on Thursday after the news.
Amazon CEO Andy Jassy. Image Credit: Amazon
U.S. Senator Amy Klobuchar said she called on the Federal Trade Commission (FTC) to “examine the deal thoroughly,” citing Amazon’s past investments in healthcare and the implications of the company’s access to medical data.
Asked by The Washington Post in June about Amazon’s expansion into healthcare, FTC Chairman Lina Khan said: “Our current approach to thinking about mergers has even more work to do to fully understand what it means for these companies to already to enter these other markets and industries.”
Amazon was a major investor in Drugstore.com, a start-up launched in 1999 and acquired in 2011 by US pharmacy chain Walgreens.
Image credit: One Medical
One Medical offers a subscription-based model where users pay a monthly fee to access doctors, including, but not limited to, virtual appointments.
The company went public in early 2020 and its stock price skyrocketed during the early stages of the coronavirus pandemic, but those shares are now trading below their original listing price.
“We think healthcare is high on the list of experiences that need to be reinvented,” Neil Lindsay, senior vice president of Amazon Health Services, said in a statement.
“We love inventing things that should be easy, and we want to be one of the companies that will dramatically improve the healthcare experience in the coming years,” he said.
One of Amazon’s biggest rivals in combining technology and healthcare is Google, which last year acquired fitness tracking company Fitbit.
London-based AI company DeepMind, which Google bought in 2014, operates a health division that became part of Google Health in 2019.