Partnerships / Acquisitions

Walmart In Talks To Acquire PillPack For Under $1B

Walmart is in talks to acquire online pharmacy start-up PillPack for under $1 billion.

CNBC cited two sources, who stressed that while the talks have been ongoing for months, the deal is far from done and might not happen.

PillPack manages prescription medications for its customers, including people with multiple chronic conditions. The site packages, organizes and delivers drugs while offering 24/7 customer service.

The startup has raised $118 million from investors, including CRV and Menlo Ventures, and earned more than $100 million in revenue last year. In 2016, it was valued at $330 million.

One source said that PillPack will continue offering its service to customers, regardless of whether it’s acquired by Walmart or another company. In fact, the sources said that Amazon had also expressed interest in the company at one point. Amazon could not be reached for comment.

A Walmart spokesperson simply told CNBC, “We are often asked to speculate on possible acquisitions and we simply don’t comment on those types of questions.”

But health experts say that acquiring the startup would be a good move for Walmart, especially since it is in early talks to buy insurance company Humana. If the deal goes through, Walmart would become one of the largest health insurance companies in the United States.

The retail giant currently operates pharmacies in close to 4,700 stores in the U.S., as well as in many of its Sam’s Club warehouse stores. It also operates primary care clinics, and recently announced it was looking to work with a big lab company to provide lab testing services.

“A PillPack-like experience for customers would be a huge differentiator for any pharmacy,” said Bob Kocher, a health investor with Venrock, who does not have any inside knowledge of the deal.

In addition, the move would help Walmart expand its online pharmacy business.

“Walmart is trying to offer a better eCommerce experience as a retailer, as well as on the health side with its pharmacies, and it wouldn’t cost them that much to buy a company like PillPack,” he added.


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