Walmart (WMT  ) is flirting with buying PillPack, the online mail-order pharmacy startup.

Walmart may acquire the startup for less than $1 billion. Walmart is likely drawn to PillPack's model, which is focused on making it easy for customers to fill and refill prescriptions. The talks have been under way for four months, but the deal is by no means final, and could still fall apart. PillPack is not alone amongst the startups that Walmart is considering acquiring. As part of its overall plan to expand its health care operations, Walmart has also made a deal with behemoth insurer Humana Inc. (HUM  ) to offer co-branded Medicare drug plans. Walmart may also form a closer partnership, or perhaps even a merger, with Humana Inc., which would represent a much larger deal than the PillPack purchase.

The deal comes as many retail giants either pivot into the health industry or try to improve what they already offer. Walmart already runs about 4,700 pharmacies across the U.S., and has been looking for ways to expand their reach for years. Walmart rival Amazon (AMZN  ), for instance, once courted PillPack as part of an overall effort to disrupt the drug supply chain, which constitutes a $3 trillion market. Amazon has also partnered with Berkshire Hathaway (BRK.A  ) and J.P. Morgan Chase (JPM  ) to lower health care costs for its employees. And CVS (CVS  ), the largest pharmacy health care provider in the U.S., recently acquired Aetna (AET  ), the country's third-largest insurer, hoping to integrate health care services and more smoothly meet customer health care needs.

Experts believe that PillPack would be a good fit for Walmart. PillPack is oriented towards customer convenience, with a customer service team available 24/7 and complete medication management, including packaging, organizing, and delivering drugs even for patients with multiple, complex, or chronic conditions. The service has been particularly useful for the elderly - a key demographic for Walmart.

PillPack was valued at $330 million in 2016, and has since raised $118 million in funding from funders like CRV and Menlo Ventures. Its revenue topped $100 million in 2017. Walmart would be able to capitalize on PillPack's existing services without spending tons of money on the acquisition.

The only blemish on PillPack's record since its foundation in 2013 is their dependency on Express Scripts (ESRX  ), a pharmacy benefits manager. A contract dispute between Express Scripts and PillPack raised alarm bells in 2016, particularly since PillPack CEO TJ Parker acknowledged that Express Scripts constituted a third of its revenue. Still, the dispute revealed that PillPack has a loyal customer base, as consumers took to social media to defend PillPack and help settle the matter.