At WIRED’s “The Big Interview” event earlier this month, Cost Plus Drugs founder and “Shark Tank” star Mark Cuban was asked why his low-cost drug company isn’t making more money.
“You’re not doing this for altruistic reasons – you’re doing business,” the event’s moderator noted.
“Well, I could make more money,” Cuban said to laughter from the crowd. “We are a public benefit corporation. But how much money do I need?”
“I’m not trying to go to Mars,” he said, in an apparent dig at billionaire rival Elon Musk.
Related: Mark Cuban’s startup sends the first kit of essential drugs to hospitals facing shortages
What are Cost Plus Drugs?
Mark Cuban Cost Plus Drug Co. is an online pharmacy co-founded by Cuban and radiologist Alex Oshmiansky to disrupt the pharmaceutical industry and lower drug costs. It launched in January 2022 and offers over 2,300 prescription drugs and delivery.
How Does Cost Plus Drug Price Its Drugs?
On the company’s website, Cuban describes how the pricing structure works: Cost Plus increases the base price by 15% and then adds it to the actual cost the pharmacy charges to make the drug.
So, for example, a drug like Albendazole, which treats ringworm and costs about $113 elsewhere, is $35 by the mail, according to Drugs.com. (Cuban wrote that the company paid $26.08.)
“A lot of people spend an insane amount of money every month just to stay healthy,” Cuban said. “No American should have to suffer—or worse—because they can’t afford essential prescription drugs.”
Related: How Mark Cuban made the largest pharmacy in the United States to improve its business
What is a Public Benefit Corporation?
A benefit corporation, known as a B Corporation, has shareholders who own the company, unlike a nonprofit. So, making money is the main thing, not just the main thing.
While non-profit organizations (or not-for-profits) serve a public good and make no profit, for-profit corporations still want to make money by serving a purpose greater than itself, “and the corporation’s desire to help make the world a better place. place,” according to Rick Bell of Harvard Business Services.