The Story of Mark Cuban’s Cost Plus Drug Company

Pill Bottle, concept for Healthcare And Medicine

Using the internet as a marketing platform, the investor and Dallas Mavericks owner has launched the Mark Cuban Cost Plus Drug Company. The company’s model is simple: sell drugs at a 15% markup, plus $3 for pharmacy labor and $5 for shipping. By bypassing the middlemen, Mark Cuban claims to reduce the cost of prescriptions while negotiating directly with drug manufacturers.

While the company does not yet have manufacturing operations, Cuban’s business model allows it to make generic versions of advanced therapies, including phosphodiesterase inhibitors and apremilast. It is lowering the cost of medications by reducing the deductibles and out-of-pocket costs. But the company’s business model also limits its ability to take insurance and process claims. In the end, this could sway the health care system.

In order to achieve the cost-effectiveness goals of Cost Plus, Cuban’s new online pharmacy is lowering drug prices for more than 100 generic drugs. The company is also ditching pharmacy benefit management companies, which negotiate benefits and discounts with health insurers and employers. However, many of these companies have been criticized for not being transparent in their pricing practices, so Cuban’s business model is a welcome change.

The Mark Cuban Cost Plus Drug Company started with the aim of providing affordable medicines for all Americans. Without health insurance, basic prescription medications cost a fortune. Many Americans spend large amounts every month just to stay healthy. Cuban believes no one should suffer just because they cannot afford to purchase basic prescription medicines. With health insurance costs soaring and rising, no American should be left behind. The company was formed by Cuban in late 2013 and has successfully rolled out its first drug sale this year.

The founder of the company is a billionaire and owner of the Dallas Mavericks. He has a successful track record as an investor and a Shark Tank panelist. His new company cuts out insurance companies and politicians by charging their clients the lowest price possible. While most governments miss the mark when it comes to drug prices, Mark Cuban’s Cost Plus Drug Company is a prime example of how a businessman can get ahead by eliminating all these middlemen and lowering the cost of prescription drugs. The layers of costs with most drug purchases is shocking. This company is seriously challenging that model.

Despite the escalating costs of prescription drugs, most Americans support government action to keep costs under control. Many of those government actions have made the situation worse. Unfortunately, while legislative efforts have failed to make significant changes, a new generation of entrepreneurs is betting on free market strategies. These companies will make drugs affordable to the average consumer. And they will do so by providing generic alternatives. The next step is to implement these free market strategies. Cuban’s company can help make that happen, and it could save the nation money.

While Cuban and CEO Alex Oshmyansky are taking on a large industry with deep pockets, they’re not the first to mess with prescription drug prices. The nonprofit Civica Rx has produced upwards of 50 generic medicines. Unlike most pharmaceutical companies, Civica Rx prioritizes drugs based on need, and they promise volume to partners. That means that the average Cost Plus cost is 50 percent less than the generic drug price at the mainstream retail pharmacy.

All opinions expressed on USDR are those of the author and not necessarily those of US Daily Review.