At DWM, we are always looking out for ways to save money for our clients. Earlier this year, we wrote about Mark Cuban’s new pharmaceutical company “Cost Plus Drugs”. Even in this environment of unusually high inflation, drug prices continue to rise above the rate of inflation. However, we are pleased to report that Mark’s discount pharmacy is making waves in the healthcare industry. So far, the company’s website has seen 1.4 million patients sign up, 400,000 of whom have filled at least two prescriptions. Earlier this year, we wrote that the website only offered about 100 generic drugs- it now offers around 350. Cuban and “Cost Plus Drugs” face difficult challenges, but they hope to overcome them and save Americans millions on drug prices as they enter new partnerships and build a brand-new pharmaceutical plant.
A recent study conducted by the University of Southern California has estimated that Mark Cuban's discount pharmacy could save Americans billions of dollars on their healthcare costs. The study found that if just 10 percent of Americans switched to the discount pharmacy, Medicare could save an estimated $1.5 billion per year. These savings would be passed on to consumers, who would see a significant reduction in their prescription drug costs. The findings of this study provide further evidence of the potential benefits of Mark Cuban's discount pharmacy. As the company continues to grow and expand, it will continue to have a major impact on the healthcare industry and help to reduce the high cost of drugs for Americans.
In an effort to continue growing and transitioning into an all-in-one company that makes and distributes medicines, Mark Cuban’s Cost Plus Drug Company (MCCPDC) is building a new pharmaceutical plant in the Dallas neighborhood of Deep Ellum. The plant is set to start manufacturing drugs early next year. The company is using the plant to increase its offering of drugs and increase its market share in the industry. While the plant is set to initially manufacture drugs that are currently on the FDA’s shortage list, ones normally not very accessible, this is a great step. And it is just one of the first steps- Cuban and MCCPDC plan to reinvest their profit into building more manufacturing facilities, taking more market share and continuing to reduce prices.
In our last blog, we mentioned that this endeavor was rather limited. MCCPDC only offered drugs in a direct-to-consumer model. Now, Cost Plus Drugs has entered in partnership with Emsana Rx, a pharmacy benefit manager (PBM) focused on employer plans. Emsana Rx is the only PBM built by employers, for employers and whose interests are aligned with those of Cuban and his company: increase transparency and reduce prices. This partnership marks Cost Plus Drug’s transition from an exclusively direct-to-consumer model to a model that also includes the employer market. This entrance has the potential to be a key revenue stream as the employer market provides health benefits for about half of all Americans. We are excited to see the impact MCCPDC will make now that they have a foothold into the employer market.
Cost Plus Drugs continues to expand its model, recently partnering with insurer Capital Blue Cross, an independent licensee of the Blue Cross Blue Shield Corporation. This means starting in 2023, Capital Blue Cross members will be able to access lower priced drugs through MCCPDC. Sharing the same goal as Cuban, CEO and President of Capital Blue Cross Todd Shamash said, “Capital’s collaboration with Cost Plus Drugs will help us bring lower-cost medications to members and nonmembers alike across our service area, providing some much-needed relief to those struggling to pay for their vital – and sometimes life-saving – medications.” While this will have a direct effect on those insured by Capital Blue Cross, we expect that it will have a snowball effect on the industry. We’re confident that these savings will reach even those not insured by Capital as other insurers and PBMs attempt to compete with MCCPDC and its partners. This company continues to evolve before our eyes, branching into new segments of the pharmaceutical industry.
Based on the company’s rapid growth and potential to cut drug costs, it is our belief that Cost Plus Drugs is on the right track to attain its goal of transparency and fair pricing in the pharmaceutical market. Cuban and his company still face significant challenges but continue to overcome one after the other as they reach more Americans, invest in growth, and form well-aligned partnerships. If you still haven’t had a chance to check out the website yourself, we encourage you to do so. Let us know what you find! We’d love to hear that we pointed our clients and friends in the right direction, saving them some hard earned dollars. We’ll keep you up to date as this story unfolds- DWM wants savings for you as much as Mark Cuban!