Billionaire Mark Cuban is providing a solution to the rising costs of prescription medicines in the US via an online pharmacy.
The Shark Tank investor and owner of the Dallas Mavericks has launched The Mark Cuban Cost Plus Drug Company (MCCPDC), which aims to sell 100 different generic drugs at lower-than-market prices.
“It’s ridiculous what the pricing for generic drugs is. Period end of story,” Cuban wrote to Forbes in an email.
Cuban, estimated to be worth $4.2 billion, didn’t disclose how much he invested in Cost Plus Drugs.
“I put my name on it because I wanted to show that capitalism can be compassionate and to send the message I am all in,” he said of his newest venture.
The idea for the Dallas, Texas-based company grew out of the pricing scandal involving “Pharma Bro” Martin Shrkeli, who raised the price of antiparasitic drug Daraprim from $13.50 to $750 per tablet when he was CEO of Turing Pharmaceuticals.
“I was just so livid about that, said the founder and CEO of MCCPDC, Dr. Alex Oshmyansky, a Texas radiologist. “I had patients have serious injuries from the high cost of drugs, which should have been very cheap. I’ve been angry about it for a long time.”
It’s one of the reasons why the online pharmacy’s first drug will be a generic version of another antiparasitic drug called albendazole, which is used to treat hookworm.
“The people getting price-gouged are people who are living in extreme poverty,” said Oshmyansky. “If you get it, and you treat it right away, it’s not a big deal. But if it’s left to fester, it can cause cognitive defects and neurological problems.”
According to Oshmyansky, it only takes two albendazole tablets to treat an infection.
The MCCPDC has also partnered with Rojelio Mejia, an assistant professor and physician at Baylor College of Medicine, to study the pervasiveness of hookworm in rural Alabama.
Albendazole’s average cash price is $225 per tablet, and Cuban’s company will sell it for only $20 per table.
Other notable medications that will be available at Cost Plus Drugs include the following:
- Imatinib – A leukemia treatment with a retail price of $9,657 per month that MCCPDC offers for $47 per month
- Mesalamine – A ulcerative colitis treatment that retails for $940 per month but comes in at $32.40 per month with MCCPDC
- Colchicine – A gout treatment that costs $182 per month, which MCCPDC sells for $8.70 per month
The online pharmacy also plans to expand its offerings. In a tweet to someone asking about a medication not included in the initial lineup, Cuban said they “will add them as quickly as we can.”
“We will do whatever it takes to get affordable pharmaceuticals to patients,” Oshmyansky said. “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.”
The registered pharmaceutical wholesaler’s business plan is rooted in transparency, with the goal of producing “low-cost versions of high-cost generic drugs.”
The strategy is to “bypass middlemen and outrageous markups.” This means MCCPDC will buy drugs from wholesalers, package them, add a 15% markup and a $3 pharmacist fee, and then sell them to clinics, pharmacies, and health systems.
MCCPDC eliminates the fee paid to pharmacists, pharmacies, and pharmacy benefit managers who negotiate contracts with various stakeholders in the healthcare industry.
“There are numerous bad actors in the pharmaceutical supply chain preventing patients from getting affordable medicines,” said Oshmyansky. “The only way to ensure affordable prices get through is to vertically integrate.”
The company refuses to pay spread prices to third-party PBM administrators to be allowed to process insurance claims, so customers can only pay for their medicines in cash.
The great thing about this model is that patients can immediately buy a broad array of medications at prices that are often way cheaper than what most deductibles and copays would.
The online pharmacy is also building a plant in Dallas to fill and package medicines under sterile conditions.
If costs go down, the prices will, too, although MCCPDC will stick to the 15% markup.
“If others beat our pricing, we celebrate,” Cuban wrote on Twitter.
This new venture has received plenty of praise online. “Thanks @mcuban for @costplusdrugs because instead of $25 for this month, I paid $10, including shipping!” wrote one Twitter user.
In response to people’s feedback to his initiative, the philanthropist said in a tweet: “Glad Cost Plus Drugs can help! We are just getting started and have a long way to go!”
Click on the video below to learn more about this new online pharmacy that offers affordable life-saving medicines.
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