Inside the rise of Mark Cuban as billionaire launches online pharmacy for cheap drugs after starting in business aged 12
BILLIONAIRE investor Mark Cuban this week launched a new online pharmacy to make prescription drugs more affordable for all Americans after starting in business aged 12.
The Shark Tank judge, and owner of the Dallas Mavericks, will be selling more than 100 generic drugs practically at cost through his new pharmaceutical wholesaler company, The Mark Cuban Cost Plus Drugs Company (MCCPDC).
Cuban's company is seeking to combat the price gouging of prescription drugs by large pharmaceutical companies, pledging that MCCPDC will be "radically transparent" in its price negotiations with drug manufacturers.
MCCPDC purchases drugs directly from manufacturers, bypassing middlemen to lower the price of more than 100 medications, the company said in a statement.
Those drugs will then be sold with a 15 percent markup across the board and a small pharmacist fee. By comparison, large pharmaceutical companies typically mark up prices by at least 100 percent, and even up to 1000 percent in some cases.
An example of the significance of Cuban's new company may play is best articulated by the drug imatinib, which is used to treat leukemia.
The price of imatinib usually retails at over $9,000 per month, and the voucher price is $120. Cuban's company, meanwhile, will be selling the life-saving drug for just $47 per month.
COMBATTING PRICE GOUGERS
Though not all markdowns will be as drastic - such as a common cholesterol medication that is typically sold for $55 but will be sold by MCCPDC for less than $4 - it will still undoubtedly make a huge difference for millions of Americans.
The company does not process insurance claims and requires customers to pay for their medications out of pocket. But as the company notes, the majority of its drugs cost less than most insurance plans' deductible and copay requirements.
MCCPDC was first founded in January last year, shortly after now CEO Alex Oshmyansky reached out to Cuban with an idea for a low-cost generic drug company over email.
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The decision to set up the company was motivated in part by the outrage surrounding "Pharma Bro" Martin Shkreli, who hiked the price of the life-saving drug Daraprim from $13.50 up to $750 per tablet.
Speaking to Forbes last year, Cuban said he decided to back Oshmyansky's vision because he wanted to show "capitalism can be compassionate" and believed the pricing for generic drugs was "ridiculous."
It's unclear how much Cuban invested in the company. Forbes estimated his net worth to be around $4.5 billion as of Thursday.
SERIAL ENTREPRENEUR
Cuban, 63, has been the majority shareholder of the Dallas Mavericks since 2000.
Growing up in a working-class Jewish household, he first forayed into the world of business aged 12, selling garbage bags door to door in his hometown of Pittsburgh, Pennsylvania, as well as stamps and coins.
He later went on to study at Indiana University, where he briefly owned a popular bar in the local area alongside his studies.
After graduating, Cuban moved to Dallas where he created MicroSolutions, a computer consulting service.
The company grew to more than $30 million in revenue before he sold off to Compuserve in 1990 for just over $5 million.
Then in 1995, Cuban and fellow Indiana University alum Todd Wagner founded Broadcast.com, an internet radio and webstream company.
Cuban and Wagner came up with the idea after trying to find a solution to not being able to listen to Indiana College Hoosier basketball games at leisure.
By 1999, Broadcast.com had grown to 330 employees and made $13.5 million in revenue for the second quarter. Later the same year, the company helped to launch the first-ever live-streamed Victoria Secret Fashion Show.
Yahoo! would later require Broadcast.com for $5.7 billion before the turn of the millennium.
After sanctioning the multi-billion-dollar sale, Cuban took a trip to Las Vegas to celebrate but traveled in coach on a Southwest Airlines flight.
"I was in the center seat facing the wrong way on the plane thinking, ‘This is just perfect,'" Cuban told CNBC in 2019.
“The wisest advice I ever got was ‘live like a student,’” Cuban said. “That served me a long, long time.”
NBA SUCCESS
Cuban took over the Mavericks months later, overseeing the team during the first-ever appearance to the NBA Finals in 2006 - and becoming NBA World Champions in 2011.
In addition to the Mavericks, Cuban joined the cast of ABC's Shark Tank in 2011. He has been a "Shark" on the show ever since and is an investor in an ever-growing portfolio of small businesses and start-ups.
Outside of the business world, Cuban is the best-selling author of How to Win at the Sport of Business, and is credited as an executive producer on a number of movies that have been nominated for seven Oscars, including Good Night and Good Luck, and Enron: The Smartest Guys in the Room.
According to his website, he also holds multiple patents, including a VR solution for vestibular-induced dizziness, and a method for counting objects on the ground from a drone.
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He lives in Dallas with his wife Tiffany, daughters Alexis and Alyssa, and son Jake.
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