Whether they take the form of pharmacy benefit managers or spokespeople, Mark Cuban cuts out middlemen.
In January 2021, Mr. Cuban — a billionaire investor known for owning the NBA's Dallas Mavericks and starring on ABC's Shark Tank — launched a generic drug company called the Mark Cuban Cost Plus Drug Co. The company has expanded since then, launching an online pharmacy, building a manufacturing facility and working to create its own PBM.
Mr. Cuban said he is not disrupting the pharmacy space to make money. In fact, he's decidedly unfocused on growing profitability for his drug company, he told Becker's in a Feb. 21 email he sent just 24 minutes after our inquiry was sent.
"Our sole mission is to be the low-cost drug provider for as many drugs as we can possibly offer," Mr. Cuban said. "That is counter to most business interests, particularly over a long period of time."
The company's rejection of bureaucracy is incongruous with healthcare's love-hate relationship with red tape. Many healthcare leaders criticize bureaucracy one day, then point to their industry as the most regulated of all as a reason for inactivity the next.
Mr. Cuban pointed to hospital price transparency as an example: Even when the federal government requires transparency, hospitals fail to comply, and those that do post price disclosure lists that look "like something straight out of the Looking-Glass." Since price transparency regulations went into effect Jan. 1, 2021, CMS has sent about 342 warning notices to hospitals that have been found noncompliant with the rule.
Health system leaders would be wise to keep an eye on Mr. Cuban, not only for his pharmacy efforts but for his alarmingly straightforward approach.
Mr. Cuban is behind a running list of actions so simple they practically warrant a double take. The Mark Cuban Cost Plus Drug Co. was born from a cold email. Drugs at the pharmacy are sold with a 15 percent markup for price, a $3 pharmacy fee to pay the pharmacists it works with and a fee for shipping. ("That's it," Mr. Cuban says.) Mr. Cuban also accepted and completed our interview at a rate even the most well-staffed PR agencies cannot match — sans calendar invitation or spokesperson.
This modus operandi is worth its weight in gold in healthcare. And Mr. Cuban knows it.
"Sometimes industries get so set in their ways, so acquisitive and incestuous, or the opportunities are so big that they become the focus of private equity and other similar investors," he said. "When that happens, it takes someone from the outside and a lot of years to result in change. Just look at the auto or mainframe computer industries as prime examples."
Although healthcare at large struggles to embrace transparency, Mr. Cuban said his drug company will forge its own path. One of the company's biggest initiatives is creating its own PBM that will establish contractual relationships with entities including cities, hospital unions and self-insured companies. Mr. Cuban said the PBM's competitive advantage hinges on its transparency and simplicity.
Simplicity is a guiding principle for the Mark Cuban Cost Plus Drug Co., from its PBM to its name to its main goal, which Mr. Cuban put — again — simply: to save patients "a lot of money" and reduce their stress.
"That comes from executing on our plans and reducing the stress of patients and doctors throughout the country," he told Becker's.