Amazon reorganizes its health-care business after executive departures Clutch Fire

For the better part of a decade, Amazon has been trying to carve its way into the U.S. health-care market, through billions of dollars worth of acquisitions, big-name hires and high-profile partnerships. It’s been a slog at times, and the company’s long-term strategy hasn’t always been clear.

Following a series of executive departures, Amazon is now restructuring its health business, telling CNBC that Amazon Health Services will be divided into six new units, with a goal of creating a simpler structure.

As part of the effort, the company has tapped a number of longtime Amazon leaders and elevated some One Medical executives to oversee the divisions. Neil Lindsay, senior vice president of Amazon Health Services told CNBC in an interview that the company has been working on the overhaul for the past several months.

“Our leadership team has been focused on simplifying our structure to move faster and continue to innovate effectively,” Lindsay said in a video chat. “One of the problems we’re trying to solve is the fragmented experience for patients and customers that’s common in healthcare.”

Amazon said it hasn’t conducted broad layoffs as part of the changes.

The reorganization comes after Amazon lost several senior health leaders in recent months. Dr. Vin Gupta, who joined in 2020 and served as chief medical officer of Amazon Pharmacy, left in February, followed by Trent Green, whose last day as CEO of Amazon’s primary care chain One Medical was in April.

Aaron Martin, vice president of health care at Amazon, announced internally last month that he plans to leave his role. Dr. Sunita Mishra, Amazon’s chief medical officer, also departed in May. 

Mishra and Martin’s departures have not been previously reported, and neither responded to requests for comment. Amazon doesn’t plan on naming a new CEO of One Medical following Green’s departure.

Martin, who lives in Nashville, Tennessee, said in a memo to staffers that he’ll remain at Amazon “for a while” to help with the transition.

“I then plan to take some time off this summer and hang out with my wife and my kids, finally get a cover band going in Nashville, and then possibly do something new,” Martin wrote in the memo, which was shared with CNBC.

Amazon has for years been on a mission to crack the multitrillion-dollar U.S. health-care industry, which is notoriously complex and inefficient.

While it had long served providers and others in health care with its cloud-based technology, Amazon’s first big splash directly into the market came in 2018 with the the acquisition of online pharmacy PillPack for about $750 million. Two years later, it launched its own offering called Amazon Pharmacy.

The company then bought One Medical for $3.9 billion in 2023, among its largest acquisitions ever, giving Amazon access to a chain of brick-and-mortar primary care clinics and a robust membership base.

There have been some major setbacks. The company shuttered its telehealth service, Amazon Care, in 2022. That came a year after it disbanded Haven, the joint health-care venture between Amazon, Berkshire Hathaway and JPMorgan Chase. The announcement of Haven in 2018 sent shockwaves through the medical world, pushing down shares of health-care companies on fears about how the combined muscle of leaders in technology and finance could wring costs out of the system.

In the areas where Amazon continues to operate, competition is fierce and, in the case of primary care, margins are very slim.

PillPack founders TJ Parker and Elliot Cohen, who left Amazon in 2022, recently launched a new health-care marketplace called General Medicine that will compete with Amazon. Mishra confirmed to STAT News that she advised the nascent startup. Amazon declined to comment on whether Mishra’s involvement with General Medicine was related to her departure. 

Lindsay characterized the recent departures as part of the natural evolution of Amazon’s health business. He added that there’s “no shortage of depth of talent” within his organization.

“We’re a fast-evolving organization because the opportunity is so big,” Lindsay said.

Under its new structure, Amazon Health Services will be focused around the six groups, or what the company calls “pillars.” 

• One Medical Clinical Care Delivery, led by Dr. Andrew Diamond
• One Medical Clinical Operations and Performance, led by Suzanne Hansen
• AHS Strategic Growth and Network Development, led by John Singerling
• AHS Store, Tech and Marketing, led by Prakash Bulusu
• AHS Compliance, led by Kim Otte
• AHS Pharmacy Services, led by John Love

Amazon declined to share financial figures for its health business, but Lindsay said it is seeing “very strong growth” across the offerings.

One Medical went public in 2020, and it was still losing money when it was bought by Amazon. At the end of 2022 in its last quarter as a standalone entity, it reported a net loss of $101.1 million on revenue of $272.4 million.

Since joining Amazon, One Medical has been working to open new offices in states including New Jersey, New York and Ohio. 

Amazon said in January of 2024 that its pharmacy business “doubled the number of customers” it served in the past year, though it didn’t share specific figures. The company is opening pharmacies in 20 new cities this year, and about 45% of U.S. customers will be eligible for same-day medication delivery.

“If we can make one thing a little bit easier for a lot of people, we’ll save them a lot of time, a lot of money, and some lives,” Lindsay said. “And if we stack these changes up over time, it’ll feel like a reinvention.”

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