Mark Cuban, Humana CEO announce drug pricing partnership during Forbes panel

Entrepreneur and television personality Mark Cuban and Jim Rechtin, the CEO of Humana, revealed on Thursday that they’ve teamed up to tackle the rising costs of prescription drugs, particularly for employers looking to manage the costs of benefits.

During Thursday’s Forbes Healthcare Summit, Cuban represented his startup Cost Plus Drugs, a company that bypasses pharmacy benefit managers (PBMs) by offering pharmaceuticals directly to consumers. Along with Humana, Cuban said his company is looking to sell drugs directly to employer health plans.

For now, the current focus is on older adults, with Cost Plus Drugs partnering with CenterWell, Humana’s primary care centers that cater to seniors. Notably, CenterWell utilizes its own specialty pharmacies for its members, allowing them to get prescriptions directly from their providers.

Details on exactly what Cuban’s company and Humana are planning to do were not revealed, with sources telling the outlet that the plan is in its early stages. However, it is expected to involve the insurer's Medicare Advantage enrollees, of which there are some 5 million.

Cuban and Rechtin said a new direct-to-consumer option would help enrollees to save money on their prescriptions, utilizing this yet-unknown new model for drug distribution. Forbes added that Humana is working on ways to remove middlemen who stand in between drug manufacturers and consumers, mainly PBMs and retail pharmacies. 

“With the direct-to-consumer pharmacy, the way that works is we are contracting directly with the manufacturers [and] the consumers coming directly to us,” Rechtin said during the panel. “They're seeing the face value of the cost of the drug. There’s no layer upon layer upon layer of other players in that value chain.”

As Forbes points out, Humana owns a PBM as part of its vertical, meaning it has the power to negotiate for lower drug prices, which they currently do for CenterWell patients who utilize the company’s network of pharmacies.

Currently the organization offers at-home delivery of drugs, something Cost Plus Drugs may be able to take over if a potential deal is worked out. Currently, Cuban’s company offers that exact service to patients who have a valid prescription.

It’s been transparent about how its business model works. On the homepage of its website, Cost Plus Drugs boasts about a 15% markup for all drugs, with prices entirely set based on its negotiation with manufacturers.

For more, read the full story in Forbes at the link below.