Of course, issuing a press release is easy. Now comes the hard work of trying to change an entrenched and exceedingly complex market. Whoever leads the venture will have to form relationships with drugmakers, hospitals, insurers, regulators, pharmacy benefit managers and other stakeholders. Any impact is likely to be least three to five years away, according to Bank of America.
Not everyone agrees there ever will be an impact. “Many have tried but few have succeeded,” said Sarah James, a Piper Jaffray health services analyst. “We do not expect this joint venture to be a meaningful disruptor to the industry, despite the stock reaction indicating that it is.”
Dimon’s Respect
Successful or not, it will be a new model in an arena where the public and private sectors have struggled mightily, a project by powerful companies with close ties. JPMorgan uses Amazon for its cloud computing services and the bank issues Amazon-branded credit cards, for example.
Dimon has spoken glowingly of Buffett and fashioned his letters to shareholders after those the legendary investor writes. The banker often cites Bezos’s approach to disruption.
“Remember, Jeff Bezos says, your margin is my opportunity,” Dimon said at his last shareholder meeting. “When we see valid investments to make, we will make them.”
This article was provided by Bloomberg News.