I received an email from Mark Cuban.
He scolded me for not including a tip of the hat to his Costplusdrugs.com company in a story I wrote about drug middlemen accused of jacking up drug prices.
I could hear his recognizable voice when he wrote, “You don’t mention us at all? Come on Dave.”
I replied candidly that “my knowledge on the subject is limited. That’s probably the first story I’ve ever done.”
He answered, “I’m always happy to answer questions about it.”
If I didn’t know much about the Costplusdrugs.com story, I’m sure I’m not the only one. I do know that his company is trying to fix the high price of drugs, but I didn’t know how.
Here is the transcript of our email conversation.
Watchdog: Mark, the pharmaceutical industry is likely the most powerful industry in the world. How exactly do you take them on?
Cuban: It is also the most opaque industry in the world. We simply introduced transparency. We show our costs, our markup and our final price to patients. It’s simple. But no one else publishes their complete price list.
Watchdog: How did you come up with this idea?
Cuban: I got a cold email from my co-founder who said he wanted to start a compounding pharmacy. I thought we could be bigger and more impactful. That got us to Cost Plus Drugs.
Watchdog: I’m a little confused by the company name Costplusdrugs. Shouldn’t it be minus, not a plus?
Cuban: We take our cost and mark it up 15%. So that is our cost plus our markup! Hence Cost Plus!
Watchdog: So that’s how you make money.
Cuban: We sell an awful lot of medications. But more important, we keep our costs low. We don’t spend any money on ads or marketing. We rely on word of mouth and amazing interviews like this.
Watchdog: The Federal Trade Commission recently took legal action against three of the powerful so-called “pharmaceutical benefit managers.” In your scolding note to me, you wrote that Costplusdrugs.com was the source the FTC used to go after the middlemen? What does this mean? What was your involvement in the government action?
Cuban: All it took was our publishing our complete price list of 2,500 drugs. It was the first time there was a benchmark for pricing so that agencies, companies and patients could look up a price and compare.
Watchdog: How old is the company? How many employees does it have?
Cuban: We started shipping on Jan. 22, 2022. And we have about 60 employees.
Watchdog: How do you market this service to the public?
Cuban: By getting well-informed reporters such as yourself to write about us! We don’t spend money on advertising so we can keep our prices low.
Watchdog: Do doctors work with you?
Cuban: Yes. Doctors can look us up in their eScript systems and send us prescriptions.
Most doctors also will look up pricing of the drugs they prescribe on cost plus to see if we carry it and if we can save their patients money.
Watchdog: When you work on this project, what exactly do you do in a typical day?
Cuban: Answer your emails. What else would I do?
Watchdog: Didn’t I read somewhere that you want to devote more time to the project and that’s why you sold majority ownership of the Mavericks and stepped down from the Shark Tank television show? Is that true?
Cuban: Yes.
Watchdog: I’m sure that helping people get necessary drugs gives you a great feeling. Can you share a story that shows how poignant and life-saving this endeavor has been?
Cuban: So many. I get emails, letters and people walking up to me on the street telling me how their lives have been changed because they have saved hundreds or even thousands of dollars PER MONTH.
It’s really worth it to check our pricing for any med you take. Often we are less expensive than your deductible or copay.
Watchdog: In the past, I’ve checked the website to see if an expensive pill I take daily shows up. What’s the process for you to add something to the menu?
Cuban: We are trying to add every FDA [Food and Drug Administration] approved med. We work with the manufacturers to work out deals.
Watchdog: What effect has this project had on the industry?
Cuban: We have had an enormous impact on overall pricing. Companies and patients can now comparison shop. We have seen drugs that we carry come down in price, but rarely to our price.
Watchdog: Who are your biggest enemies on this project? How to they try to thwart you?
Cuban: The big pharmacy benefit managers (PBMs) don’t like us. They are the reason the industry is opaque. When there is no transparency, they can charge whatever they want for a medication.
Now they are being pushed to change their approach.
Watchdog: Finally, off the subject, I’m curious about something. When you type answers to these questions, are you using a computer or do you prefer to type on your phone?
Cuban: phone. Please excuse the Tpyos
Watchdog: Thanks, Mark.
