Issue No. 144: Amazon Prime Health

Courtney Powell

An online bookseller turned everything store, Amazon is the quintessential one-stop shop.

But eCommerce isn’t the end game. From sleep monitoring and fitness tracking to prescription medications and on-demand telehealth, Amazon is pursuing the trillion-dollar opportunity in healthcare.

As the company plots its next move, today, we’re exploring Amazon’s growing list of health-focused initiatives.

Ripe for Disruption

The US healthcare system is fundamentally broken.

  • In 2021, US healthcare spending will top $4T, jumping to $6.9T by 2028.
  • Despite spending more, the US healthcare system ranks last in performance among high-income countries.

As costs continue to skyrocket, outcomes aren’t improving. Lacking personalization and transparency, while becoming increasingly inconvenient, the overall experience has suffered.

Accelerated by the pandemic, healthcare providers and patients are adopting new digital tools as lawmakers ease restrictions on remote care. Seizing the moment, digital health startups attracted record levels of funding as tech giants like AppleGoogleMicrosoft, and Amazon doubled down on the space.

More specifically, Amazon is tapping customer loyalty and convenience as it enters new territory.

  • Amazon counts 200M Prime members worldwide, with 147M in the US.
  • The membership boasts first- and second-year retention rates of 90%+.
  • Member or not, nearly 50% of Americans use Amazon to search for products.

To date, the company’s health-related efforts have been largely siloed, ranging from wearables to health data and virtual primary care. But, as time goes on, these separate initiatives could come together as part of a comprehensive offering.

Pharmacy

Taking aim at $500B in prescription medication spending, in 2018, Amazon paid $750M to acquire PillPack.

Integrating PillPack into the broader platform, in November 2020, the company introduced Amazon Pharmacy. Now, users can fill a prescription through the Amazon website or app and have it delivered, with Prime members receiving free two-day shipping and special discounts.

“We designed Amazon Pharmacy to put customers first – bringing Amazon’s customer obsession to an industry that can be inconvenient and confusing.” – PillPack co-founder and VP of Amazon Pharmacy TJ Parker

A step further, Amazon has shown interest in opening physical retail pharmacies. According to Business Insider, the eCommerce titan has discussed setting up standalone stores as well as putting pharmacies inside Amazon-owned Whole Foods locations.

Fitness & Wellness

In August of last year, Amazon introduced Halo, a wrist-worn health and fitness tracker, app, and subscription service.

Like most health wearables, Halo monitors physical activity, heart rate, and sleep. But the device also tracks emotional health by monitoring a wearer’s tone of voice and uses computer vision to analyze body fat percentage.

In June, Amazon introduced a new Halo feature called Movement Health, accessing a user’s stability, posture, and mobility to create a corrective exercise program. An added utility, the Halo band now syncs with other fitness apps and connected equipment.

Other related developments include the company’s workout-tracking Echo Buds, complete with a built-in accelerometer and Alexa-powered voice commands for measuring calories, distance, pace, and duration of a run.

Pushing further into sleep tech, Amazon is developing a radar-powered device for “contactless sleep tracing functionalities.” Using 3D monitoring, the company said it’s focused on sleep hygiene and health benefits, possibly related to sleep apnea.

Of note, through its venture capital arm, The Alexa Fund, Amazon is also dabbling in the fitness space, with investments in ZwiftTonal, and Aaptiv.

Health Diagnostics

When the pandemic hit, Amazon launched on-site COVID-19 testing for employees. In a matter of months, the company was conducting tens of thousands of tests a day across hundreds of locations.

Then, this summer, Amazon rolled out at-home COVID tests for consumers. Following the blueprint used to scale initiatives like Amazon Web Services, the company operationalized test kits in-house ahead of a consumer offering.

Next up? The company could expand its home testing efforts to include kits for respiratory illness, sexually transmitted diseases, and genomics.

  • The point-of-care diagnostic test market is expected to top $81B by 2028.
  • Last year, venture funding for health diagnostics startups reached a record $4.8B.

Known internally as codename Project Ultraviolet, Amazon Diagnostics is reportedly shaping up to compete with consumer tests like Everly Health and 23andMe, as well as testing competitors Quest and Labcorp.

Amazon Care

Earlier this year, Amazon said it would expand its telehealth service nationally, making it available to employees and other companies.

Amazon Care initially launched two years ago as a pilot program for the company’s employees in Washington state. As the service expands publicly, it will offer virtual consults and in-home visits for urgent and primary care needs.

Adhering to the company’s key selling points, convenience and customer obsession, the Amazon Care website reads:

“Healthcare has never been more convenient. At Amazon Care, healthcare is built around you and your family. Here, your needs, time, schedule and loved ones come first.”

So far, Amazon Care has signed “multiple clients,” including Peloton-owned fitness equipment manufacturer Precor and its 800 employees. But, it’s also struggling to get insurers like Aetna to pay for the medical service.

Looking Ahead

Bringing the convenience of one-click buy or same-day delivery to healthcare, it’s not hard to imagine a service like Amazon Prime Health.

Still nascent, as Amazon’s healthcare ecosystem takes shape, members can use Halo to monitor their vitals, receive at-home health kits, fulfill prescriptions, and access virtual doctor’s visits on their own terms. And, with AWS for Health housing the data, the company can explore disease diagnosis and treatments.

A massive undertaking, Amazon has the capital and infrastructure to make a run at reimagining healthcare. Along the way, they’ll encounter stiff competition from Big Tech foes like Apple, retailers like Walmart, and a growing list of startups pursuing the same personalized approach.


🎙Stay Ready

From movement health to recovery and durability, The Ready State pioneered mobility training as we know it.

On the Fitt Insider podcast: Kelly and Juliet Starrett, the husband-and-wife team behind The Ready State, joined us to discuss the evolution of their business, from a CrossFit gym to a YouTube channel and a variety of digital coaching products and coursework.

We also cover: the fitness industrial complex as it relates to the booming fitness industry but widening health gap. Plus, the Starretts share their values-driven approach to business.

Listen to today’s episode here

🙏 Dying Well

The wellness trend has reached the grave. Discussing death has long been taboo in American culture, but as the population ages, a rising number of grief wellness startups are here to help you die better.

Death positivity. Millennials are increasingly embracing a pragmatic approach towards mortality. 18% of Americans aged 18–39 believe that people should prepare for their funerals before the age of 40, compared to 7.9% of individuals over 60 who thought the same.

“[Millennials] are a generation that [understand that]… not talking about death can lead to a less self-aware life,” says mortician Caitlin Doughty.

The COVID-19 pandemic further exacerbated issues in the end-of-life care industry, which has seen limited innovation in the past 50 years.

  • From funeral preparations to gathering digital accounts, families can spend up to $12,000 and over 500 hours managing a loved one’s post-mortem affairs.
  • Millions of patients across the world are dying alone in sterile hospitals, surrounded by unfamiliar faces instead of their loved ones.
  • Meanwhile, church membership and trust in social institutions have dropped to historic lows.

Filling in the spiritual gap, grief wellness startups are harnessing tech in an attempt to return a sense of meaning to bereaved family members.

  • Empathy, an AI death assistant for grieving families, raised $13M in April.
  • Cake, an online platform for navigating mortality planning, raised $3.7M this July.
  • Lantern, a “how-to” app for preparing for death, raised $1.4M in seed funding.
  • GoodTrust, a digital legacy management platform, secured $2.3M.

Reconsidering cremation. Others are rethinking methods of body disposal. Mark Cuban-backed Eterneva turns ashes into diamonds and raised $10M in July. Meanwhile, Recompose turns corpses into compost and is seeking $15M in Series A-3 funding.

Looking ahead: Terminal patients are turning to VR to check off their bucket lists, using psychedelics to cope with end-of-life distress, and hiring death doulas to ease the actual passing process.

Takeaway: Death tech isn’t entirely new, but to date, most startups have been unable to overturn long-held traditions. The pandemic has accelerated a shift in attitude, and more believe that preparing to die well later is essential to living well now.

David Kessler, an executive officer at Empathy,  lost his 21-year-old son several years ago and saw his life spiral into logistical chaos. After discovering grief wellness apps, he noted:

“Technology can’t promise to take the pain away, but it can hold your hand through the process [and offer] guidance in the often unknown terrain of grief.”

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🧐 Branding or Better-for-you?

Consumers are swapping out meat and dairy for plant-based alternatives. But beyond ethics and sustainability, is plant-based actually better for our diets?

Meatless mania. As demand booms, countless startups are competing to make plants palatable.

  • Vegan-related searches on Google spiked 47% to an all-time high last year.
  • Retail sales for plant-based foods are projected to increase fivefold by 2030 to $132B.
  • Driving interest in healthy eating, COVID-19 continues to transform our shopping behaviors.

Across the US, an increasing number of health-conscious consumers are going vegan/vegetarian while less-gung-ho flexitarians may honor the occasional meatless Monday.

When surveyed, over 40% of these consumers have a “health halo” mindset towards plant-based products, believing that they’re healthier. The thing is, that’s not always the case.

Oatly, the new Coke? In 1970, Coca-Cola touted the “health benefits” of sugar, funding misleading research and deceptive ads to build its sugary empire. Drawing parallels, some are souring to Oatly’s marketing, which tends to downplay the alt-milk’s vegetable oil and sugar content while “hand-waving away evidence that they’re harming you.”

Examining the company’s messaging, writer Nat Eliason calls out a common misconception: “They make zero claims about it being healthy, but you definitely feel like they said it was healthy for you.”

Processed plants. On the patty front, meatless meats tend to be ultra-processed, high in saturated fat, and packed with sodium, according to a Harvard study.

While you probably won’t be worse off eating a traditional burger, dietitians raise concerns over consumers who might then overindulge following a presumably “healthy” plant-based meal.

Now, as fast food giants like McDonald’s and Burger King jump on the plant-based train, nutritionists are worried that companies are masquerading artificial, processed products under the guise of a better-for-you offering.

The bottom line: The honeymoon phase might be coming to an end for “plant-based”-branded products as more sophisticated consumers learn to read between the lines of flashy marketing.

And while most plant-based alternatives prevail when viewed through the lens of animal welfare or climate change, expect brands who champion nutritional transparency to win out in the long term.

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📰 News & Notes

  • From IV drips to infrared saunas, recovery heats up.
  • Beyond Meat files trademark on Beyond Milk name.
  • Allbirds launches activewear line ahead of planned IPO.
  • Updated: 950+ job openings at top health and fitness companies.
  • GlaxoSmithKline and R/GA Ventures ready health studio for startups.
  • Startup Q&A: Oova CEO Amy Divaraniya on ​​the complex world of fertility.
  • Ultra-processed foods make up 2/3 of calories in children and teen diets.

💰 Money Moves

  • Connected rowing company Aviron, a “gaming-first platform”, secured $4.5M in new funding from Samsung NextFormic VenturesGFC, and Y Combinator.
    More from Fitt Insider: The Connected Rowing Wars
  • Maven Clinic, a telemedicine platform for women’s and family health, raised $110M in Series D funding co-led by Lux Capital and Dragoneer Investment Group.
  • UK-based biotech firm Beckley Psytech pulled in £58M ($79.6M) in new funding to advance its psychedelic treatments of depression and migraines.
    More from Fitt Insider: Psychedelic Wellness
  • Carrot, a fertility benefits provider for employers, landed $75M in a Series C round led by Tiger Global.
    More from Fitt Insider: Femtech 2.0
  • Private equity firm First Bev acquired a majority stake in kombucha maker Health-Ade with backing from Manna Tree. Terms of the deal were not disclosed.
  • LifeAID, maker of a portfolio of vitamin-infused functional drinks, added $20M in an oversubscribed Series C round.
    More from Fitt Insider: Functional Beverage Takeover
  • Hydration company Cirkul secured $30M in Series B funding led by AF Ventures to accelerate the footprint of its patented water bottle.
    More from Fitt Insider: The Rise of Clean Hydration
  • San Francisco-based Spora Health, a digital primary care provider designed for people of color, raised $3M in a seed round led by M13MaC Venture Capital, and Refactor Capital.
  • TeamGenius, a player evaluation and development platform for youth sports organizations, landed $1.1M in an oversubscribed seed round led by Great North Ventures.
  • Australian food tech company Fable Food secured AUD$6.5M ($4.73M) from Blackbird Ventures and others to launch its mushroom-based meat alternatives in the US.
    More from Fitt Insider: Meat vs. “Meat”
  • Boxmagic, a Chile-based booking and payment platform serving gyms in Latin America, landed an undisclosed investment from Defiance Ventures.
  • Israeli healthtech startup Hagar, creators of a continuous glucose monitor using radio frequency, raised $11.7M in a Series B round led by Columbia Pacific.
    More from Fitt Insider: The Business of Glucose Monitoring
  • Swiftarc Ventures launched a $10M fund investing into female-founded beauty and wellness startups.
  • Dream Sports, the parent of fantasy gaming app Dream11, launched Dream Capital, a $250M fund to invest in sports, gaming, and fitness-tech startups.
  • Starday, a healthy and sustainable food products company, raised $4M in seed funding co-led by Equal Ventures and Slow Ventures.
  • Vision Quest Velocity, a performance-driven cycling app, acquired PerfPro Software Suite, a software platform for indoor cycling.