Blendcap method will work, by Merge of curvy rounded rectangle, and extrusion. Then do fillet of 0.19. (Might want to start with a slightly smaller curvy rounded rectangle.)
Note, there are 3 naked edges in the lower indent of the bottle.
Really cool Zarkow. I especially like the "sweep" to cutback both edges to use blend for the connection!!!
Here is a method using "Flow" to place a pill on the bottle to cutout and fillet (With the fillet you can choose the constant distance or the rolling ball)
The "depth" of the cutout can be controlled by the placement of the base curve, relating to the pill.