This Week in Startups Solving prescription drug pricing in the US with Cost Plus Drugs & Capital RX CEOs | E1518
Jul 26, 2022
In this engaging conversation, Alex Oshmyansky, the CEO of Mark Cuban Cost Plus Drug Company and a practicing radiologist, discusses his mission to create a parallel supply chain to lower drug costs. He delves into the 'financial engineering' of the industry and the importance of transparency. Later, AJ Loiacono, CEO of CapitalRx, highlights the opaque nature of pharmacy benefit managers (PBMs) and their effect on pricing. Both guests passionately advocate for innovative solutions to revolutionize prescription drug accessibility and transparency.
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From Nonprofit to For-Profit
- Oshmyansky initially tried to establish Cost Plus Drugs as a non-profit, but Y Combinator advised him to reincorporate for better fundraising.
- Mark Cuban later became a surprisingly operationally involved investor.
Drug Production Process
- Cost Plus Drugs purchases active pharmaceutical ingredients and focuses on the regulated fill-finish process of drug production.
- They operate as a 503B compounding pharmacy to address shortages and pursue ANDA approvals for generics.
Insulin Production Challenges
- Insulin production is more complex as a biologic, involving genetically engineering cells.
- PBMs still manipulate insulin pricing, despite lower production costs.