Mark Cuban is spearheading an effort to widen Americans’ access to generic pharmaceuticals, adding a direct-to-consumer online pharmacy to the Mark Cuban Cost Plus Drug Company (MCCPDC) in January of 2022. The ecommerce site currently sells generic medications with a focus on drugs on the FDA shortage list.
Cuban’s involvement may come as a shock. He is a digital entrepreneur and investor who owns a professional basketball team and is well known for his time on the television show Shark Tank. His business experience mostly stems from tech and media, so why is he dabbling in drugs? The fact is, many Americans struggle to afford medication, and Cuban thinks he can do something about it.
Pharma in the USA
Insurer payments and individual spending for prescribed medications are higher in the U.S. than any other developed country and residents are feeling the squeeze of those high prices. A recent Gallup poll showed that 18 million Americans cannot afford vital medication, and one in 10 have skipped doses trying to make prescriptions last longer or to save money needed for other expenses such as food, utilities, or even other medications.
For some patients, skipping doses or forgoing medicines puts their lives at risk. “We will do whatever it takes to get affordable pharmaceuticals to patients,” said Alex Oshmyansky, CEO of MCCPDC. “The markup on potentially lifesaving drugs that people depend on is a problem that can’t be ignored. It is imperative that we take action and help expand access to these medications for those who need them most.”
Slashing Costs
MCCPDC plans to keep costs low based on vertical integration – managing or cutting out steps that would normally be handled by multiple business that could each apply a markup. MCCPDC is a licensed pharmaceutical wholesaler that negotiates directly with the manufacturers of approximately 100 generic medicines, and earlier this year became its own pharmacy benefits manager (PBM) with an ecommerce site. By taking insurance companies out of the equation, MCCPDC medicines must be paid for by the consumer and not processed for reimbursement, but the prices reflect manufacturer price plus a flat margin and pharmacist fee, making them even more affordable than many copays offered by health plans.
Imatinib, the generic version of Gleevec®, a treatment for leukemia and other cancers, is one example. Skipping doses means cancer growth can go unchecked, making it critical for patients who are prescribed this medicine to have access to the drug. The retail price for Imatinib in the United States exceeds $9,000 per month, while a patient with insurance might pay around $120 per month. MCCPD offers the drug for only $47 a month – less than one percent of the mainstream cost. Mesalamine, a treatment for ulcerative colitis that could cost as much as $940 per month, has a price of only $32.40 on the MCCPDC website. The story is the same across the board, with some medicines purchased through MCCPDC available for less than $10 a month.
Building Out
For the time being, the online pharmacy is only selling drugs sourced from other generic manufacturers, but company is currently building a manufacturing facility in Dallas to potentially remove that reliance as well. The company also has plans for a biologics license application, indicating that it may produce biosimilars (generic versions of biologic medicines) at the new facility. With the addition of the PBM to the business, MCCPDC hopes to partner with businesses to give employees access to these affordable options as a part of their benefits package.
Right now, MCCPDC only sells generic medicines and focuses exclusively on the FDA shortage list. By cutting out the middleman and a commitment to “radical transparency,” Cuban’s venture will transform the public understanding of drug costs – but will it disrupt the marketplace? MCCPDC joins a number of companies with programs that make generics available at a low cost – Walmart and Target to name a few. To really disrupt the high costs of medicines in the U.S., change will have to happen on a much broader scale.
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