In recent years, we have seen a significant increase in the involvement of big tech companies in the pharmaceutical industry. According to a report by CB Insights, the "FAMGA" companies (Facebook, Amazon, Microsoft, Google, and Apple) have been making strategic investments and partnerships in the pharmaceutical and healthcare sectors. Three major factors have been driving this increased involvement and interest on behalf of the big tech companies: Inefficiency, data, and digital. With a large part of the drug development process still manual, there is a market for more efficient solutions and these solutions are enabled by the increase in patient data and digital technologies such as AI that are now available. With such bold and targeted moves on behalf of these companies, it is very likely that we will see a massive shift in the health tech industry in the future, with large corporations at the forefront.
Amazon
One major way Amazon is getting involved in the healthcare industry is by building online pharmacy capabilities. From November 2021 to March 2022, Amazon was in talks with Apollo Hospitals and Blue Cross, Partnering with Blue Cross in a few states. In July of 2022, they acquired One Medical for $3.9 Billion and eventually launched a virtual clinic this past November. You would think that this would cause quite a stir, however, news around Amazon’s actions in the pharmaceutical industry has dropped off significantly. Amazon has also been taking measures to build connections and knowledge in the pharmaceutical supply chain, suggesting a quiet but bold attempt at establishing itself in the industry in the near future.
Microsoft
With the acquisition of Nuance in 2021, followed by the expansion of Microsoft Cloud for healthcare and partnership with CRM Surgical, Microsoft is focusing on the software and date side of things. With new SaaS offerings, progress in data storage, and the use of AI for drug research, Microsoft is positioning itself to take a new age of pharmaceutical tech by storm.
Apple
Apple has turned its focus to hardware, data-powered biomarkers, and a software ecosystem for pharmaceutical companies. Medical equipment, such as a portable ultrasound device, is now compatible with the iPhone and Apple with John Hopkins University, the Mayo Clinic, and Rune Labs to increase the health monitoring capacities of the Apple Watch. In January 2021, Apple partnered with Biogen to help study digital biomarkers for disease using data. With Apple’s software ecosystem, Pharmaceutical companies are finding it easier to build apps in the industry.
Alphabet
Alphabet is data-driven, baking startups such as DNAnexus, Verana Health, and Tempus. They have also partnered with Mayo Clinic and Highmark Health amongst others. Alphabets subsidiary, Verily, raised $1 Billion to use towards precision health backed by patient data. Alongside this, Alphabet is building RPM hardware and utilizing AI for new drug discovery.
It's important to note that these big tech companies' entry into the pharmaceutical industry is not without controversy. There are concerns about data privacy and the potential for these companies to dominate the market and drive out smaller competitors, not to mention general motivations. However, the potential benefits of their involvement, such as improved patient outcomes and reduced healthcare costs, cannot be ignored.
Overall, the involvement of big tech companies in the pharmaceutical industry is a trend that is worth paying attention to. Their advanced technologies and vast amounts of data have the potential to revolutionize the way we approach healthcare, but it is crucial to ensure that patient privacy and fair competition are protected.