Billionaire Mark Cuban is one of America’s best-known investors, made famous for showering his money on ABC’s “Shark Tank” reality show contestants.
He’s also a serial entrepreneur trying to upend the pharmaceutical market.
Most patients have a routine when it comes to getting their meds, which usually involves visiting the drugstore nearby.
With his Mark Cuban Cost Plus Drug Company, launched in January, Cuban sees a new future in which they buy affordable medicine online from his pharmacy that’s delivered quickly to their doorstep. It currently offers hundreds of generic drugs.
Ben talked with him about Cost Plus. The interview is edited for length and clarity.
What was the impetus for the Cost Plus Drug Company?
[Now-CEO] Alex [Oshmyansky] and I discussed how distorted the pricing in the pharmacy industry is. That if pricing is so obtuse that it’s easy to raise prices, it may be just as easy to lower them.
And by adding transparency, and a simple pricing structure, our cost plus 15 percent plus $3 handling and $5 shipping, we could build trust and acceptance and possibly eliminate the distortions.
What’s the market for it?
Everyone that takes a medication that we can legally sell.
When do you expect to make a profit?
We don’t know, but we want to, and think we will.
How can you compete with pharmacies like CVS and Walgreens?
Trust and pricing. The chains are owned by big public companies that are vertically integrated. It’s tough for them to break away from the way things have always been done or how their parent companies want to do business.
We have a very simple goal: To be the low-cost provider of medications that is completely transparent. This allows patients to know why they are paying what they are paying for their medications.
Do you plan to move beyond generics to name-brand drugs?
Yes. Hopefully, very soon.
How are insurers responding?
Very positively. Many, particularly the ones that are not part of large, vertically integrated companies, are often charged more for meds than what we sell them for. There are already some that send their patients to us and reimburse them.
How ripe is health care for disruption by new business models? Do you see opportunity besides pharmacy?
Transparency is a powerful drug.
Is the government a help or a hindrance to innovation in health care?
Neither. Again, the lack of transparency makes it just as difficult for the government to figure out the right steps to take as it does patients. Any industry that is opaque has an advantage. Until there is disruption. Hopefully, we can be that disruptive force that brings transparency. Time will tell.
PUTTING COST PLUS IN CONTEXT:
Cuban’s not alone in trying to take on drug prices in nontraditional ways.
Hospitals and foundations teamed in 2018 to found Civica Rx to manufacture generic medicines. California-based GoodRx has a website where consumers can compare drug prices across pharmacies. A number of startups are trying to take a larger portion of pharmacy benefit managers’ market share.
And Cuban has competition from major players that are also selling online like CVS, Walgreens, Rite Aid and Amazon.
This is where we explore the ideas and innovators shaping health care. Looks like regions with profitable hospitals also have high rates of patient medical debt. Does that sound right to you?
Share news, tips and feedback with Ben at [email protected], Ruth at [email protected] or Carmen at [email protected].
Send tips securely through SecureDrop, Signal, Telegram or WhatsApp.
ENDING THE PANDEMIC — Huge swaths of the world, including the United States, haven’t reached the vaccination level that the World Health Organization believes is needed to end the Covid-19 pandemic. It’s one reason WHO Director-General Tedros Adhanom Ghebreyesus disagrees with President Joe Biden’s view that the pandemic is over.
Tedros has a fall-back plan, given declining Covid vaccine uptake. Here’s what he says world leaders can do to end the pandemic, despite missing the 70 percent target for full vaccination.
1) Ensure access to antiviral drugs and tests
“Many people don’t know this is a treatable disease,” Bruce Aylward, a senior adviser to Tedros, told Future Pulse.
Aylward is part of the Access to COVID-19 Tools Accelerator, a global collaborative that helps developing countries access vaccines, drugs like Pfizer’s antiviral, Paxlovid, tests, and oxygen supplies.
Pfizer has two deals to supply low- and middle-income countries with its antiviral: through UNICEF and the Global Fund to Fight AIDS, Tuberculosis and Malaria.
But testing, a treatment prerequisite, is still scarce in parts of the world, according to a new ACT-Accelerator report.
And some donor nations are struggling with their own finances.
2) Vaccinate older adults and health care workers
Three in four Covid deaths in the United States are among people 65 and older, and the disease has hit older people hard throughout the world. Health care workers bear the risk, too, when treating the highly infectious disease.
Inoculating those groups is needed to avoid preventable deaths, Aylward argued.
Hunger is a health care issue. That’s one of the themes of the White House Conference on Hunger, Nutrition, and Health happening today in Washington, D.C.
The conference’s first panel is looking at how “food is medicine.”
What’s that? It means using food to combat some of the most pernicious diseases afflicting Americans.
What the data shows: There’s mounting evidence that patients can reverse diabetes by making changes to their diet and exercising. A growing body of research in mice shows that targeted nutrition may assist drugs in starving cancerous tumors — clinical trials are underway.
Who’s offering the service:
- Health systems, like Geisinger and Kaiser Permanente, are testing programs that subsidize or cover fresh produce and other healthy foods for patients.
- Startups and nonprofits: telehealth firm Season Health is connecting patients and dieticians to help with meal planning and then making ordering the food easier; a nonprofit called About Fresh offers a debit card that patients can use for only doctor-prescribed foods.
- Chain pharmacies see opportunity, given their proximity to consumers. “It allows the pharmacist to do holistic care to treat the whole person,” said Christie Boutte, senior vice president of reimbursement, innovation and advocacy at the National Association of Chain Drug Stores.
Advocates of the medicine-as-food concept say it will save insurers and Medicare and Medicaid money in the long run if it keeps patients healthier. But they acknowledge that getting them to pay for meals will be challenging. “It’s going to be an educational journey to get them to realize the benefit,” Boutte said.
On that note: Biden wants Congress to pass legislation so Medicare can pilot food reimbursement for patients with diet-related diseases.
His administration has secured $8 billion in commitments from the private sector on everything from food donations to nutrition training for doctors, and access to free dietary advice.