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Amazon acquires health provider One Medical for $3.9 billion

E-commerce giant Amazon announced Thursday it will acquire primary health care organization One Medical in a deal valued at roughly $3.9 billion, marking another expansion for the retailer into health care services.

Amazon said in a statement it will acquire One Medical for $18 per share in an all-cash transaction. Outside of the health care space, Amazon also owns grocery store chain Whole Foods, esports streaming service Twitch, home security doorbell service Ring and dozens of other subsidiaries. 

One Medical marks one of Amazon's biggest acquisitions, following its $13.7 billion deal to buy Whole Foods in 2017 and its $8.5 billion purchase of Hollywood studio MGM, which closed earlier this year.

Neil Lindsay, senior vice president of Amazon Health Services, said in a statement that the acquisition is geared toward reinventing the health care "experience" for customers, particularly around things like booking an appointment, long waits in a hospital waiting room, and taking trips to a pharmacy.

"We think health care is high on the list of experiences that need reinvention," he said. "We love inventing to make what should be easy easier and we want to be one of the companies that helps dramatically improve the health care experience over the next several years."

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A nonprofit that advocates for stricter antitrust laws raised concerns about Amazon acquiring One Medical. The American Economic Liberties Project in Washington said it's unclear if Amazon will protect patients and their sensitive medical records.

"Allowing Amazon to control the health care data for another 700,000 plus individuals is terrifying," Krista Brown, the group's senior policy analyst, said in a statement Thursday. "Amazon has no business being a major player in the healthcare space, and regulators should block this $4 billion deal to ensure it does not become one."

Under terms of the deal, which must still pass regulatory approval, Amir Dan Rubin will remain as CEO of One Medical.

One Medical is excited to join Amazon, a company that has a "willingness to invest in the long-term," Rubin said in a statement.

"There is an immense opportunity to make the health care experience more accessible, affordable and even enjoyable for patients, providers and payers," he said. 

One Medical, whose parent company is the San Francisco-based 1Life Healthcare, Inc., is a membership-based service that offers patients both in-person and virtual doctor visits. As of March, it had about 767,000 members and 188 medical offices in 25 markets, according to its first-quarter earnings report, which also showed the company had incurred a net loss of $90.9 million after pulling in $254.1 million in revenue.

Amazon's latest acquisition furthers the company's foray into the health care services. In 2020, the retail giant opened an online drug store that allows customers to order their medication or prescription refills online and have it delivered to their front door in a couple of days. Last year, it began offering its Amazon Care telemedicine program to employers nationwide.

In morning trading, shares of 1Life Healthcare surged 68% to $17.13.

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