By, Jenny Hall
Account Manager, Benefit Intelligence
A few key points to understand regarding the new Generic Drug Company is that Cuban is only producing lower-cost alternatives to already generic drugs. They are not lower-cost alternatives to name brand meds, which are typically the costliest to members and insurance companies. That doesn’t mean there isn’t a benefit to this initiative, but it is not a game-changer when it comes to combating the costs name brand meds.
For those that utilize a Pharmacy Benefit Manager, it will be interesting to see their reception to the Mark Cuban Cost Plus Drug Company as there are no rebates for insurance companies.
For those without insurance or a high deductible heal plan that requires members to pay for their own medication, this may provide a reasonable, cost-effective alternative. Additionally, how will this work for services like GoodRx?
As more and more players enter into the prescription medication segment, we look forward to learning more about Mark Cuban’s new venture.
Mark Cuban launches generic drug company
Beckers Hospital Review reports:
The new company’s website says it is dedicated to producing low-cost versions of high-cost generic drugs and pledges to “provide radical transparency in how we price our drugs.”
The Cost Plus company will publish the costs to manufacture, distribute and market its drugs to pharmacies. It said it adds a 15 percent margin to get its wholesale prices and make sure it remains profitable, but that there are no middlemen and no rebates for insurance companies.
Dallas Morning News notes that the company was originally named Osh’s Affordable Pharmaceuticals after its founder and CEO Alex Oshmyansky. But, It launched in 2018 and, spurred by a cold email pitch, received backing from Cuban shortly after:
Oshmyansky is a medical doctor with a Ph.D. in mathematics from the University of Oxford who also works a weekend shift as staff radiologist at Vision Radiology in Dallas.
Much like he works with Shark Tank companies Cuban’s initial investment was relatively small and required the doctor to send weekly email updates on the progress of the company, Oshmyansky told The Dallas Morning News.“My impression was he was impressed by how much progress was being made week over week,” Oshmyansky said. “In entrepreneurship, I think ideas are easy to come by but execution is hard to find.”
Fox News reports that The company is launching with albendazole, an antiparasitic drug that has an average list price of $225 per tablet, but Cuban’s company has a manufacturer’s suggested retail price of just $20 per tablet. With insurance, the cost would be even lower.