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Amazon today unveiled plans to get into the pharmacy business with the acquisition of the online service PillPack. The company had raised $118 million and TechCrunch pegged the acquisition price at almost $1 billion, which would make it one of Amazon's largest acquisitions to date.

Pharmacy stocks in the U.S. market dropped on the deal announcement, most notably those of CVS (-8.1%), Rite Aid (-3.1%), and Walgreens Boots Alliance (-9.2%).

'PillPack's visionary team has a combination of deep pharmacy experience and a focus on technology, ' said Jeff Wilke, head of Amazon Worldwide Consumer. "PillPack makes it simple for any customer to take the right medication at the right time, and feel healthier", its cofounder and CEO TJ Parker said in a press release.

"We know that we have to change the level of our services to the customers and we are working quite hard on that direction, but we are not anxious", Pessina said. Apparently Walmart was also interested in buying PillPack and was outbid by Amazon. And they won't be alone: Drugstore giant CVS recently struck a deal with the United States Postal Service to deliver prescription drugs and other goods to customers homes. The company sorts your pills by dose, including vitamins and over-the-counter medicine, into personalized daily packets and delivers everything right to your door each month.

Lekraj noted that PillPack's business is geared largely toward patients with recurring medication needs, which, as a group, tend to be older, and many of those people still prefer to go to bricks-and-mortar pharmacies. It also handles refills and communicates directly with users' insurance and doctors. It counts Accel Partners, Atlas Venture, CRV, Founder Collective, Menlo Ventures, Sherpa Ventures, Techstars among its investors.

Walgreens Chief Executive Stefano Pessina, in a conference call after reporting quarterly results, said he was "not particularly worried" about the PillPack deal, describing it only as a "declaration of intent" by Amazon.