After wreaking havoc on pet stores over the past decade with its predatory pricing strategies for pet food and supplies, Chewy now has its sights on making the veterinary channel the latest conquest in its campaign to dominate the pet care market.
Of course, this shouldn't be news for anyone who has been paying attention over the past few years—after all, the online retailer started offering prescription medicines and diets back in 2018 and announced the launch of its telehealth services in October 2020. However, Chewy has signaled a new era of aggressiveness in going after the veterinary market with a recent lawsuit.
In the suit, the online retailer accuses Covetrus (an online pharmacy service that partners with veterinary practices) and Vetcove (a provider of veterinary practice management software) of conspiring to use deception in order to redirect prescriptions originally placed with Chewy. Through this legal action, the company seeks to stop what it describes as deceptive communication between the defendants and veterinary clients, and wants to be reimbursed for revenue lost as a result of these practices.
As far as I can tell, Chewy has not provided specific examples of the types of communication that it takes issue with in its lawsuit, so it is impossible to gauge whether or not they rise to level of being "deceptive." However, I think the lack of specific examples probably speaks volumes about how far the online retailer is stretching the definition of the word. In fact, after wading through the points and counterpoints contained within statements given by all of the parties involved, it seems that the online retailer is objecting to the practice of trying to entice veterinary clients to fill their prescriptions through Covetrus (which, by the way, shares the proceeds with the veterinary practices with which it partners).
Does Covetrus have an advantage in partnering directly with veterinary practices to handle online prescription medication orders? Undoubtedly, but that is clearly the very same advantage that Chewy is trying to gain with the recent launch of its veterinary marketplace.
Now, it's hard to feel too bad for Covetrus, which is a publicly traded, multi-billion-dollar company, but there are also lots of small veterinary practices getting caught up in this battle over the prescription pet medication market. They have been consistently losing more and more revenue to Chewy's predatory pricing practices over the past few years, which is why they began partnering with companies like Covetrus in the first place.
At the end of the day, the whole lawsuit just seems like an attempt by Chewy to smother competition in a market that is vital for pets and their owners. But it's not like we've ever seen that before, right?