Mark Cuban’s Cost Plus Drugs is turning the prescription drug industry on its head.
Last year, the company started shipping generic prescription drugs to customers at severely reduced rates.
Fourteen months after launching, Cost Plus company has 2.1 million accounts.
How? It’s simple. Cuban, the eccentric, billionaire owner of the Dallas Mavericks and co-star of NBC’s “Shark Tank,” said Thursday in Nashville he eliminates intermediaries while offering transparency in pricing.
Cuban said 14 months after launching, his Cost Plus company has 2.1 million accounts.
“It’s crazy that people in this country have to choose between rent, food and whether or not they’ll have to ration their medication,” Cuban said. “We felt like if the delta in price or cost saved one more person, that was direction we wanted to go.”
His savings strategy has caught the eye of Vanderbilt University Medical Center. On Thursday he spoke on a university panel about the state of prescription drug costs and insurance in America.
Cost Plus Drugs changing the game
Stacie Dusetzina, a professor of health policy at Vanderbilt, participated on the panel with Cuban and Talwar. She is leading the charge locally to get people better access to prescription drugs.
Dusetzina said 49 million Americans receive insurance through Medicare. She also said Americans face two insurance-related problems.
Either they are not insured, or they are so underinsured they don’t have coverage that meets their needs.
“There are too many entities in it who are making a lot of money,” she said. “Everyone in the system will have to make less money if you want to fix this for patients.”
Ruchika Talwar, an urologic oncology fellow at Vanderbilt University Medical Center, published an article in the Journal of Urology, stating Medicare could save $1.29 billion by purchasing nine different urology drugs through Cuban’s company.
Four years ago, Cuban said he realized prescription costs were increasing to all-time highs. Still, he believed the pricing market was a mess and prices could be slashed.
“Nobody ever knew what things cost,” Cuban said. “So, we felt by showing our costs and being completely transparent, we could change the industry.”
Prices include a 15% pharmacy charge, with a fill fee of $3 that could soon raise to $5. There’s also a $5 shipping charge.
Cuban’s personal stake in affordable prescription drugs
One of Cuban’s friends was paralyzed in an accident. His friend was told they would have to pay $30,000 every three months for Droxidopa.
Under Cost Plus Drugs, his friend would pay $61 a month.
A cancer patient seeing chemo therapy would pay $2,000 at a pharmacy for Imatinib, a type of cancer growth blocker. .
“Why do they ask for $2,000?” Cuban asked. “Because they can.”
Cuban: Not like other pharmacies
Cost Plus Drugs only accepts insurance from companies that accept rebates, which kick more money to other vendors.
Said Cuban: “Healthcare in this country is doomed to fail, because of the way the payer models work.”
Reach reporter Craig Shoup by email at firstname.lastname@example.org and on Twitter @Craig_Shoup. To support his work, sign up for a digital subscription to www.tennessean.com.
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