By Paolo von Schirach,
March 12, 2025 – Marc Cuban is an American billionaire (net worth a bit shy of $ 6 billion) who made money in tech and as the co-owner of the Dallas Mavericks, a major basketball team. He is fairly well known because of his role as a possible investor in the popular Shark Tank TV show in which would-be entrepreneurs try to convince rich businesspeople (Cuban being one of them) to invest in their new business ventures.
High cost, low efficiency U.S. health care system
A couple of years ago, Cuban began a new company, called Marc Cuban Cost Plus. This is all about outflanking the American extremely complex, murky, opaque, and expensive system that delivers prescription medications.
The U.S., supposedly the land of efficiency and cost effectiveness, over the decades developed an enormous, multi-faceted health care system characterized by private providers, multiple insurance systems, federal health care programs, some of them subsidized, and a lot more. For the non-expert, American health care is extremely difficult to understand and navigate. Furthermore, this system has the dubious distinction of being by far the most expensive in the world, while delivering at best mediocre health care services to most Americans.
One of the worst features of U.S. health care is the high cost of prescription medications. In a country in which millions are affected by chronic diseases, expensive medications can literally ruin people, even well insured people, because insurance usually covers only a percentage of the cost of many medications.
A new idea: low-cost pharmacy
Having observed this situation, Cuban and his associates developed a simple idea. They would buy generic drugs directly from manufacturers and offer them online via Cost Plus to doctors who then write prescriptions that will be filled by a network of pharmacists and delivered to the patients.
The Cost Plus website describes how the company arrives at the price charged to the consumer. It begins by stating the price paid by the company for the medication, (typically low, because it is purchased in bulk from manufacturers), then there is a 15% profit for Cost Plus, plus a small fee for the pharmacy processing the prescription, and finally the shipping cost. All up front. This way the customer is offered full transparency on what he is charged, and in most cases at a lower price than traditional alternatives.
Real savings
For instance, the website indicates that, if purchased via Cost Plus, the cost of a 30-count supply of 400mg Imatinib (chemotherapy for certain types of cancer) is only $34.50. The same medication, if bought through ordinary channels, would cost $9,657.30. Using Cost Plus the customer ends up saving $9,622.80.
Needless to say, this is a rather extreme example of gigantic savings. However, in most cases Cost Plus prices are lower. Cuban started this pharmacy business by offering a limited number of medications. But now the company offers thousands, and the list is growing. This could become big business.
Transforming the system?
Is Cost Plus the outlier that will upend the complicated and super expensive pharmaceuticals business in America? We shall see. Keep in mind that they offer only generics that are already much cheaper than the brand name medicines.
Still, it may be possible that Cost Plus, and may be other unconventional new players, may be able to disrupt the hopelessly complicated and ridiculously expensive American health care sector.
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