Mark Cuban has spent four years telling Americans they are being overcharged for prescriptions. In a recent post on Bluesky, he let slip what the campaign has been costing him personally.
"I still subsidize every script filled at cost plus," Cuban wrote, “We are getting closer to break-even. Not there yet.”
The line did not come from an interview or an earnings call. It came in the middle of an argument about Medicare for All, in which Cuban was pushing back on the idea that passing a law would fix American drug pricing by itself. Nobody had asked him about his company's finances. He volunteered them.
Join 200K+ Subscribers: Find out why the midday Barchart Brief newsletter is a must-read for thousands daily.
That makes the number, or rather the absence of one, unusually interesting. The Mark Cuban Cost Plus Drug Company is privately held and files no financial statements, so there is no public record to check his claim against. Everything the public knows about whether the business works is what Cuban chooses to say about it, and what he chose to say is that it still loses money on every order — and that he is the one absorbing it.
Sponsored Content: Unlocking $2.1T in Energy Potential. See Why Investors Are Watching ‘FASF’.
The company's premise is that it shows customers the arithmetic: the manufacturer's price, a fixed markup, a pharmacy fee, shipping. That transparency is the product. It is also why there is not much margin to hide a shortfall in, which is roughly what Cuban is describing when he says the gap is still coming out of his own pocket.
The Problem
In a follow-up reply in the same thread, he pointed out where the difficulty actually sits, and it is not the price of the pills.
"I spend my days trying to convince CEOs to move away from conglomerates that keep prices up," he wrote. "To transparent companies, direct contracts, and other resources that push prices down. But employees fight any change." It is a sales problem, in other words, and the resistance is coming from the people the switch is supposed to help.
The conglomerates he is describing are the pharmacy benefit managers, the middlemen that sit between drugmakers and patients and negotiate what a plan actually pays. The largest are owned by public companies: Caremark by CVS Health (CVS), Optum Rx by UnitedHealth (UNH), and Express Scripts by Cigna (CI). Cuban has argued for years that the structure they created makes patients pay the highest price while everyone in the middle gets paid.
Cuban's Proposed Fix
His proposed fix has never been subtle. He has said the way to bring costs down is to remove insurance companies from the equation for routine care and let patients pay cash against a published price, and he has warned that the incumbents have grown too big to care whether that happens.
Selling that to corporate benefits departments one CEO at a time is slow, which is the part the July post makes legible. Cuban has been widening distribution rather than waiting, striking direct arrangements with employers and pharmacies, and more recently teaming up with TrumpRx to push transparent pricing to a wider audience. Volume is the only route to breakeven that a cost-plus model has.
Whether it gets there is unknowable from the outside, and Cuban did not predict that it would. What he did was tell people arguing about healthcare policy that the version of reform he actually built is still running at a loss after four years, funded by him. Billionaires are not usually in a hurry to volunteer that.
On the date of publication, Caleb Naysmith did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.