Amazon.com, Inc. (NASDAQ:AMZN) and GoodRx Holdings, Inc. (NASDAQ:GDRX) are signing up Americans for flat-fee prescription plans as health insurance coverage thins, according to a Reuters report on September 29.
Amazon charges from $5 a month and GoodRx from $14.99, with both including a range of generic drugs at no extra cost. GoodRx calls its version Companion, and bundles telehealth discounts into it. Both target the same customer, and only one needs that customer.
Amazon and GoodRx Can Sell Certainty Rather Than Discounts:
Reuters reports that both plans target Americans whose insurance coverage is thinning. Someone paying cash for a generic prescription faces a price that varies by pharmacy and by week. A flat monthly fee removes that, and the customer buys certainty rather than a discount. Certainty is easier to sell than savings, because the buyer can verify it immediately.
For the companies, the appeal is recurring revenue. Generics are the lowest cost part of the prescription market, though neither company has disclosed what margin these plans earn.
Amazon has an additional reason. It has described pharmacy as a way to deepen the customer relationship, the same rationale it has long given for Prime.
The two are not equal participants. Amazon is worth about $2.7 trillion, and GoodRx about $1.1 billion, so the pharmacy line is a rounding error for one and close to the whole business for the other.
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The Same Trend Threatens GoodRx More Than It Helps:
GoodRx built its business on discount codes that sit between the uninsured patient and the pharmacy counter. That model earns a fee on each transaction rather than a recurring payment, which is the weaker of the two positions.
A subscription is a defense against that model being commoditized, and it is also an admission that the original one is under pressure. GoodRx closed at $3.29 on September 30, more than a third lower than a year ago.
The deeper problem is who else is arriving. Amazon’s plan starts at $5 against GoodRx’s $14.99, although GoodRx bundles telehealth discounts that the cheapest Amazon tier does not.
There is also a question about how durable the demand is. Reuters attributes it to thinning coverage, which is a policy outcome rather than a product success, and policy can reverse.
If insurance coverage widens again, the demand these plans are meeting shrinks. A subscriber who signed up out of necessity has no particular reason to stay.
For Amazon, the calculation is easier. Pharmacy is a small line inside an enormous company, and its pricing does not have to be set by its own profitability.
One company is adding a feature. The other is rebuilding its business model against a rival that does not need the category to pay.
Conclusion:
The economics are genuinely attractive, because a flat monthly fee against the cheapest part of the prescription market produces recurring revenue. Both companies are also reaching customers the insurance system has stopped serving. However, the two face completely different versions of the same opportunity. One can treat the service as a retention tool. The other is defending its core business with it, against a competitor that does not need the category to pay.
What the Price Assumes:
Amazon closed at $249.15 on September 30, about 13% higher than a year ago. GoodRx closed at $3.29, more than a third lower. Amazon grew revenue 19.60% last quarter with earnings up 244.90%, which inflates the trailing figure. The shares trade near 20 times trailing earnings and about 24 times next year’s estimates, so the market expects reported profit to fall back.
That is what a buyer underwrites at Amazon, a forward multiple above the trailing one on earnings that include items unlikely to repeat. GoodRx poses the opposite question. At 55 times trailing earnings on a market value near $1.1 billion, the price assumes the subscription pivot works, and there is no second business to fall back on.
Market Sentiment:
Amazon.com, Inc. was held by 369 hedge funds with a combined stake value of about $97.1 billion at the end of Q2 2026 in the Insider Monkey database. This is up from 353 hedge fund holders with a cumulative investment value of around $77.6 billion in the previous quarter.
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This article is originally published at Insider Monkey.
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