(CTN News) – One Medical and Amazon Pharmacy are reportedly set to lose over 100 jobs, according to a letter sent by Amazon Healthcare Services director Neil Lindsay to employees.
One Medical is making this move in order to reduce its operating losses. The article cites a source who estimates that up to 400 employees may lose their jobs as a result of the restructuring.
The report said One Medical planned to reduce its fixed operating costs from 41% to 20% of revenue by 2028, and to reduce each patient’s visit to $322 from $372 by 2024.
As part of a company-wide effort to save $100 million this year, Seeking Alpha reported that several hundred jobs could be cut.
It was not possible to reach anyone at the company for a comment immediately.
WHY THIS IS IMPORTANT
The acquisition of One Medical by Amazon was announced in July 2022. It was valued at $3.9 billion. In July 2022, Amazon agreed to acquire One Medical.
There are both virtual and in-person visits available through One Medical, a membership-based primary care organization.
Another company outside of traditional healthcare provided by hospitals and physician practices made inroads into the primary care market with this deal.
The retailization of healthcare is often viewed as a threat to traditional hospital and physician services, however these transactions have not always gone smoothly. Healthcare has a learning curve and low operating margins, according to experts.
TRENDS OF A LARGER SCALE
According to a report from Seeking Alpha, Amazon’s healthcare division is the latest business unit to cut jobs. A number of company divisions, including Audible, Prime Video, Twitch, and Buy with Prime, were laid off last year.
Earlier this month, Amazon announced better-than-expected fourth quarter results and gave upbeat guidance for Q1 2024.