Big Pharma Pricing Is a Racket. These Startups Aim to Disrupt It.
In 2015, Martin Shkreli became the smirking face of drug company greed when, as founder and then-chief executive of Turing Pharmaceuticals, he bought rights to the anti-parasitic medication Daraprim and then jacked up the price from $17.60 to $750 per pill. At the time, the drug was the only therapy approved by the US Food and Drug Administration for toxoplasmosis, a disease that causes serious illness in people with weak immune systems, including babies born to mothers infected with the parasite, and those with HIV.
For Alex Oshmyansky, an emergency radiologist, Shkreli’s move was what tipped him over the edge. Fresh out of his radiology fellowship at Johns Hopkins University, the young doctor had already seen patients grow sicker and even die because they couldn’t afford their medications. He vowed to become the anti-Shkreli by starting a company to sell vital drugs at or near cost.
Three years later, Osh’s Affordable Pharmaceuticals had secured $1 million in funding. Shortly thereafter, Oshmyansky grabbed the attention of billionaire Mark Cuban. The Dallas Mavericks owner and one of the stars of the television show Shark Tank wound up going all in. In January, the Mark Cuban Cost Plus Drug Company opened shop online. The lofty aim, Cuban writes on the website, is “to disrupt the drug industry and to do our best to end ridiculous drug prices.”
The Mark Cuban Cost Plus Drug Company offers more than 100 generic drugs, which according the company, are priced at the cost of making them, plus a 15 percent markup and a $3 pharmacy fee. For someone without health insurance (which the company does not accept in the first place), or whose plan has high deductibles or copays, the savings can be dramatic. For example, the average wholesale price for a month’s worth of the cancer treatment imatinib (generic Gleevec) is $9,657, which you could cut to $120 with a coupon from the drug-tracking company GoodRx. Meanwhile, Cuban’s company offers a one-month supply for just $47.
Cuban and Oshmyanksy are not the first, nor the only ones taking on Big Pharma. In 2018, a group of health systems and philanthropists launched Civica Rx, a nonprofit that supplies hospitals with essential generic drugs. Today, the company sells about 55 medications to 1,400 hospitals at savings of about 30 percent compared to what they paid previously. The model has been so successful that the company is expanding into the consumer market with a new initiative, CivicaScript, which has partnered with Anthem and some Blue Cross insurance companies and expects to start selling drugs by mail order and through retail pharmacies later this year.
https://www.motherjones.com/politics/2022/02/mark-cuban-cost-plus-civica-osh-affordable-pharmaceuticals-bir-pharma-drug-pricing-skrelli-scandal/
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