The U.S. health care supply and retail industry is folding in on itself amid pressure to cut costs and defend against outsiders, and a potential deal between Walgreens Boots Alliance Inc. and AmerisourceBergen Corp. would take two major pieces off the table.
A Wall Street Journal report that the companies were in takeover talks sent AmerisourceBergen shares surging late Monday. The discussions are at an early stage and may not ultimately lead to a deal, the paper said, citing people it didn't identify.
If the companies agree to combine, it would be only the latest such move among firms that distribute, sell or administer health care products and services. Last year, CVS Health Corp. agreed to pay $68 billion for insurer Aetna Inc., after both looked at other companies. More deals could follow: Insurer Humana Inc. and drug-plan administrator Express Scripts Holding Co. could be potential takeout targets, according to analysts.
The threat of Amazon.com Inc. or another well-funded outsider disrupting the drug supply chain has loomed over deal discussions.
The tech retail giant acquired licenses in more than a dozen states that would allow it to distribute and sell health care goods as a wholesaler, Bloomberg reported in October. On Tuesday, the Wall Street Journal reported that Amazon had met with hospitals about potentially becoming customers of its business-to-business arm.
"The Amazon bogey finally seems to be finally spreading its wings to medical supplies," wrote Vijay Kumar, an analyst with Evercore ISI. He said the company could be a "formidable player" when it comes to selling basic hospital staples like gloves, catheters, drapes and other products.
Last year, Amazon announced Business Prime Shipping, which brings the quick delivery associated with Amazon household orders to workplaces.
