Fears of Amazon entering the U.S. healthcare industry have already crossed over to Korea, with analysts putting out estimates of what the entry will bring about to the Korean market.

According to Daishin Securities, a possible landing on Korea by Amazon healthcare will have a limited impact on the domestic drug market due to legal regulation. Online distribution of prescription drugs in Korea is illegal under the pharmaceutical law, a provision most likely to act as a deterrent to Amazon healthcare’s presence in this country.

If Amazon healthcare can enter the market under changed laws, it will deal a blow to distribution industry but have only “limited” impact on pharmaceutical firms, it said. Korean pharmaceuticals partnering with multinational giants often rely on co-pays limiting their role to marketing and distribution.

Local drugmakers in co-promotion agreements can also suffer a decrease in profit margins, considering the already low margin rates, the report said.

In the U.S., recent reports of Amazon obtaining pharmacy-wholesaler licenses in more than 12 states have caused a flurry of selloffs, analysis, and speculation over the impact it could have, with most saying it will shake the healthcare industry.

yjc@docdocdoc.co.kr

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