Insured patients are often better off buying their generic prescriptions through their health insurance benefits than through Mark Cuban Cost Plus Drug Company, though those without insurance could find cost savings in over a quarter of their pharmacy fills, according to a study published Friday in JAMA Health Forum.
Across a sample of nearly 844 million prescription pharmacy fills logged among 124 generic drugs in 2019, researchers found that nearly 100 million (11.8%) would have reduced out-of-pocket spending for patients if they had been acquired through the billionaire-backed manufacturer and distributor.
Cost Plus Drugs’ direct-to-consumer pharmacy didn’t launch until 2022. To measure the company’s hypothetical savings for consumers at the individual level, researchers adjusted the per-drug out-of-pocket costs from their sample based on the Center for Medicare and Medicaid Services’ 2023 National Average Drug Acquisition Cost.
Per the study, purchasing mail-order prescriptions through the company would have reduced patients’ spending for 5.5% of Medicare fills, 7.1% of private insurance fills, 9.9% of military (Veterans Administration or TRICARE) fills and 28.9% of uninsured fills. The researchers saw no cost savings for those with Medicaid.
“With generic drugs constituting 90% of all dispensed prescriptions, some patients can benefit from a transparent cost-plus pharmacy pricing model; however, for most, it is less expensive to use their health insurance benefits,” University of Texas MD Anderson Cancer Center and Harvard Medical School researchers wrote in the journal.
Across all insurance types, the researchers found median cost savings of $4.96 per prescription. Just over half of the savings would have been less than $5 per prescription fill, though 28.4% would exceed $10 per prescription fill.
The median estimated cost savings per prescription were, again, highest among patients who were uninsured ($6.08). These were followed by those with military insurance ($5.05), Medicare ($4.64) and private insurance ($3.69).
The researchers wrote that their findings “are consistent” with a similar analysis of the direct-to-consumer pharmacy run by Costco, which found higher spending in 11% of 2017 Medicare Part D claims. Amazon Pharmacy, meanwhile, performed somewhat better with lower prices on 20 of the most-prescribed generics, per an analysis of 2020 data.
The researchers noted that the cost and supply of drugs sold by Cost Plus Drugs “change frequently,” and that as of early 2023 only about a quarter of “expensive” generics were available for purchase through the direct-to-consumer pharmacy.
The team also didn’t look to undersell the benefits those 100 million lower-cost prescriptions could have for patients who would be seeing the savings.
“Promoting transparent cost-plus pharmacy models, such as [Cost Plus Drugs], can reduce out-of-pocket costs for a specific subset of patients,” the researchers wrote.
In March, Mark Cuban said that the company had delivered millions of prescriptions to “probably a couple million patients” and offered roughly 2,500 generic medications. Around that same time, Cost Plus Drugs locked up its first national health system buyer and said it would begin shipping under-supplied hospital drugs from a newly opened 22,000-square foot manufacturing facility sometime around the fall.