From “Shark Tank” to the aspirin aisle… Celeb investor Mark Cuban launched an online pharmacy designed to lower prices of 100 generic drugs. The Cost Plus Drug Co. aims to simplify healthcare’s complex biz model by cutting out intermediaries and selling drugs for wholesale prices — plus a fixed 15% markup.
- Drug prices are often shockingly high because of complex negotiations between drugmakers, pharmacies, and health insurers.
- CP buys drugs wholesale and breaks down their costs on its website. Think: ingredients = $12, manufacturing = $3, profit = $2.10. Thirty pills of a life-saving drug could cost $2.5K at CVS — but $17 at CP.
- CP doesn’t accept insurance, but it could be a huge help for the 31M Americans without insurance.
Rattling big pill bottles… Nearly 80% of US prescriptions are managed by CVS, Cigna, and UnitedHealth. Critics say pharmacy heavyweights use complex clauses to drive up prices, and regulators are investigating the industry. Several companies are trying to fix healthcare’s pricing problem:
Price matters, but so does transparency… That’s why companies are pursuing more transparent alternatives to traditional pharma. Cost Plus can’t fully replace pharmacy behemoths (it only sells generic drugs) and its prices may not be lower than competitors’. But CP is building a Texas factory to make its own meds. And if it steals sales from juggernauts like CVS, it could help push the whole industry to become more transparent.