Pod Insights How I Built This with Guy Raz HIBT Lab! Mark Cuban Cost Plus Drug Company: Mark Cuban About this episode Serial entrepreneur Mark Cuban was one of the very first guests on How I Built This, way back in 2016. Mark has been founding and investing in startups for decades, but he’s never put his name on a company until now.
This week on How I Built This Lab, Mark joins Guy to talk about what he’s been up to since he was last on the show. They discuss his interest in NFTs and how his latest business, the Mark Cuban Cost Plus Drug Company, is looking to disrupt the pharmaceutical industry.
Listen to Mark’s original How I Built This episode: https://art19.com/shows/831bd173-0992-41b7-b1eb-112db904d947/episodes/03dc2fc1-e9d7-4880-865c-f92d18b40c92/embed
See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
Transcript Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
0:00 Guy Raz? Our presenting sponsor today is Anthropic, the team behind Claude. Every founder on this show started with a hard question. Not the marketing plan, the 2 a.m. kind. Is this idea any good? Am I the one to build it? Should I quit my job? Anthropic got built the same way. A public benefit corporation founded on one hard question. How do we make sure AI goes well for people? So they asked over 100,000 people their hopes and their fears and are publishing what they find, even the uncomfortable parts. Me? I've got my own hard question about AI. Here it is. If everyone has access to something that can help them write the business plan,
0:46 Guy Raz? build the prototype, analyze the market, maybe even come up with the idea, what separates the people who actually build something from everyone else? I don't have a clean answer yet, so I've been sitting with it with Claude. There's hope in hard questions. Ask yours at claude.ai/hibt. We get support from U.S. Bank. A question I love asking founders. What's the one decision you almost didn't make? The one that changed everything? Because it's never the obvious stuff. It's never, I decided to start a company. It's the small, boring, Tuesday afternoon decision you barely remember making until you realize it's the reason everything after it either worked or didn't.
1:32 Guy Raz? Say you're 18 months in. Business is growing. You've got expenses coming from six directions. Gas for the van, office supplies, your phone bill, team lunches that are actually client meetings, and you're putting it all on whatever card you grabbed in year one. You're not thinking about it. Why would you? You've got bigger problems. But here's the thing. Path A, you keep going like that. End of the year, you're sorting through statements, trying to figure out what went where. You've left hundreds, maybe thousands on the table in rewards you never earned, money that could have gone back into the business. Path B, you pause and get The US Bank Triple Cash Rewards Visa Business Card.
2:14 Guy Raz? Now you're earning 3% cash back on gas and EV charging, office supply stores, cellphone service, and restaurants. You pick up an extra $750 cash back as a bonus. And you've got a low APR on purchases and balance transfers for 12 months while you're scaling. Same business, same expenses, two completely different outcomes based on one small decision. Visit usbank.com/business to learn more. The creditor and issuer of this card is US Bank National Association pursuant to a license from Visa USA Inc. Some restrictions apply. If you travel often, you'll want to hear about this unprecedented offer.
2:58 Guy Raz? For the first time ever, new Delta SkyMiles Reserve American Express Card members can earn two Delta Comfort round trip flights for travel within the 48 contiguous US states, Puerto Rico, or the US Virgin Islands. Plus, you can earn 50,000 bonus miles towards your next getaway. And who doesn't appreciate an elevated airport experience? Delta SkyMiles Reserve Card members get access to the Delta Sky Club, your pre-flight oasis to recharge with 15 visits and four one-time guest passes each medallion year when flying Delta together. That's up to $950 in annual value.
3:40 Guy Raz? Value estimate based on $50 per visit rate to purchase additional visits or bring a guest to the Delta Sky Club. Make every trip feel more rewarding with the card that upgrades your travel. Apply today at delta.com/cardsocial. Offer ends November 4, 2026. Minimum spending requirements and terms apply. Flights are fulfilled as flight certificates valid for Delta Comfort or Delta Maine to select domestic destinations. Book 21-plus days in advance. Up to $80 per person and taxes and fees apply. Other restrictions apply. When I pull up to a gas pump to fill my car, I'm not thinking about chemistry or engineering. I'm thinking about getting in, filling up, and getting on with my day.
4:23 Guy Raz? And it reminds me a little bit of the founders I talked to on this show, because the best ones obsess over things their customers will never see. Tiny details, invisible improvements, relentless iteration. And not because anyone's watching, but because it makes the product better. That's what the mobile brand does. It engineers fuel the same way great founders engineer their products. Mobile Supreme Plus Premium Gas helps keep engines three times cleaner, which can mean better performance and improved gas mileage. It's for people who care about what's under the hood, even if they never see it. Three times cleaner compared to mobile regular gas in port fuel-injected engines. Actual results may vary.
5:07 Guy Raz? Visit mobili fuels.com for details. Hello and welcome to How I Built This Lab. I'm Guy Raz. This is the place where we experiment with ideas and stories you might not hear on our Monday episode. And it's a chance to find out what happened to some of the entrepreneurs I've interviewed on the show in the past, including today's guest, Mark Cuban. Mark was on the show back in 2016, and he told us the story of how he went from bartending in Dallas to building a media company to eventually owning the Dallas Mavericks. And if you haven't heard that episode of How I Built This, please go and listen. We'll put a link in the show notes. A couple of years ago, Mark got a cold pitch email
5:50 Guy Raz? from a radiologist who was trying to shake up the prescription drug industry. The idea intrigued Mark so much that he joined forces with that radiologist to create his newest company. It's called the Mark Cuban Cost Plus Drug Company, or MCCPDC. A mouthful, and there's a story behind the name, which Mark will explain. The company wants to upend the pharmaceutical industry by drastically reducing the cost of prescription drugs. And so far, it's managed to sign up more than a quarter of a million customers who now have access to hundreds of generic drugs. Mark Cuban, welcome to the show.
6:29 Speaker 01 Thanks for having me, Guy. I'm excited to be here.
6:31 Guy Raz? All right, Mark, you were one of the very first guests we featured on the show back in 2016. And we had a great conversation about your life story and, you know, growing up in Pittsburgh and reading this book. What was the book called? Like, How to Be a Millionaire at 30?
6:46 Speaker 01 How to Retire by the Age of 35.
6:48 Guy Raz? Yeah, by the age of 35. And you could have done that, but of course you didn't.
6:52 Speaker 01 Yep.
6:53 Guy Raz? You're still doing Shark Tank?
6:55 Speaker 01 Yep.
6:55 Guy Raz? You're still, you still own the Mavericks?
6:58 Speaker 01 Yep.
6:59 Guy Raz? But let's talk a little bit about some of the things that you've been up to over the last couple of years, and including during the pandemic. You have gotten really interested in NFTs.
7:11 Speaker 01 Yes.
7:12 Guy Raz? You've got one startup that you've co-founded called Lazy, which is a way to show your NFTs. First of all, explain your interest around NFTs, because it's controversial, right? I mean, some people don't understand the appeal or the value.
7:26 Speaker 01 Sure.
7:26 Guy Raz? What is it about NFTs that you think is not just interesting, but potentially valuable?
7:32 Speaker 01 So there's a backstory there. You know, I'm a tech guy and always have been. And so, over the years, I've paid attention to and dabbled in and invested in cryptocurrencies at various levels. And about, golly, it's December of 2020, January of 2021 now. You know, I was hearing about NFTs and I decided to learn some more about them. And so I went to a site, I think it was rareable.com, and then another one, mintable.app. And I decided to mint some NFTs. I just wanted to go through the process to learn. And as I was doing it, it's a very simple process where I was filling in a form.
8:14 Speaker 01 And one of the questions that I asked was, what would I like the royalties to be? And I was like, wait, what royalties? You know, I could create this digital asset, and if it's resold time and time again, I'll continue to get paid. That, as a business person and tech guy, lit a fuse for me. And I was like, okay, this is different. This isn't just, okay, a digital version of baseball cards. Let's just buy and sell them. What enables this to happen? And as I dug into it, I realized it was something called a smart contract, and that the underpinning of all NFTs are these things on Ethereum or Ethereum-compatible blockchains called smart contracts.
8:53 Guy Raz? Right.
8:53 Speaker 01 And smart contracts really are just a programming language that are probably the equivalent of HTML or JavaScript for creating a website. Only these run on a decentralized distributed basis on top of a blockchain. That got me excited and that really led me to dig in further with NFTs. And so I started creating them and selling them and learning more about them. And, and really, long story short, the thing about NFTs is they're just like any other collectible. They just happen to be digital.
9:24 Guy Raz? Yeah.
9:24 Speaker 01 But they're easier to collect because they are digital. So if I'm collecting my favorite Willie Stargell baseball card, because I'm a Pittsburgh kid and he was my favorite player along with Roberto Clemente, and I have their baseball cards, I have to store them so they don't deteriorate. I have to get them graded. I have to ship them if I want to sell them. There's just a lot of hassle factors involved in collecting physical goods. But if I have the same picture, if you will, and I turn it into a non-fungible token, which records it on the blockchain forever, so there's a recorded history of it. Then that allows it to be a collectible and makes it easier to sell. And as I learned with the royalties, if it's a, it's an NFT that I own the rights to
10:09 Speaker 01 and have created, I can keep on getting royalties each and every time it's sold. And to me, that was an exciting opportunity for any and every collector and creator.
10:17 Guy Raz? So, so you're bullish on this. I mean, you, you believe that both as collectibles and as art, this is sort of the future.
10:26 Speaker 01 Yeah, now there's two pieces there. There's a lot of noise and it's hard to determine the signal. It's like if you walk into an art gallery or a store that sells any type of artwork at all, everybody's going to have their own opinion about what the value of any piece of artwork is going to be.
10:40 Guy Raz? Right.
10:41 Speaker 01 And it's no different for NFTs. You know, some people speculate, like they do in the physical art world and collectibles world, and some people collect. And you, every person's got to make their own choice, but an NFT is just a digital version. And when people say, well, you know, I can't physically touch it. I'm like, well, you know, you could take a picture of a baseball card and put it on a piece of cardboard and sell it and, you know, replicate anything you want in the art world. You know, it's not about physically touching. Think, think about, you know, the, when you run out of storage on your phone, you know, how valuable all those digital pictures are.
11:16 Guy Raz? Right, right.
11:17 Speaker 01 You know, people assign value to things that are digital and an NFT is no different.
11:22 Guy Raz? Mark, how do you compartmentalize all these things? I mean, you're invested in so many companies. You are part of many companies. You are obviously the owner of the Mavericks. You've got executives and managers who run a lot of these businesses. So how do you kind of divide your time and stay focused on all of these different things?
11:41 Speaker 01 Now, I'm not really involved in day-to-day operations of anything. You know, one of my faults has been I trust to a fault. There's been times when I've been taken advantage of and I'm not happy about it. But, you know, I've managed for the most part to, even if it's the result of learning from a mistake, find good people, let them do their job. And that, by trusting them and allowing them to do their job, I get to do what I like to do, which is learn everything I can related to technology and kind of speculate about where this can go. Whether it's robotics, AI, personalized medicine, cryptocurrencies, whatever it may be, they all have a lot of the same logic underpinning them.
12:23 Speaker 01 And for me, learning all that stuff and staying up to speed and getting ahead and coming up with new ideas is fun for me.
12:30 Guy Raz? Yeah. Now, with who you are and your celebrity and your wealth, people treat you differently than they did when you were a bartender, obviously. So how do you make sure that you're exposed to ideas and there's pushback and that you're challenged?
12:49 Speaker 01 Yeah, I call it questioning my whole card, checking my whole card.
12:52 Guy Raz? Yeah.
12:53 Speaker 01 You know, because that's one of the beauties, as toxic as social media has become, one of the great things about Twitter is there's always somebody willing to challenge you.
13:02 Guy Raz? Yeah.
13:03 Speaker 01 And so there's lots of times when I'll put things out there expecting to be challenged and, you know, enjoy it. I'll give you one example. We were talking about the impact of Section 230 on algorithmic enhancement of posts on Facebook.
13:21 Guy Raz? This is the part of the law that essentially kind of recuses big social media companies from the responsibility of what people post.
13:30 Speaker 01 Correct. And that's the most succinct way I've ever heard it put, so good job, guy. And so the question became, can you limit Facebook, in this particular example's, ability to algorithmically promote things? Because when you're... Designing an algorithm or using AI and setting the goals of the AI that you've created, the neural networks you've created, you effectively are making an editorial choice to promote something. And, you know, my understanding of 230 and the First Amendment was that, you know, that disqualifies you from 230 protection. And these First Amendment lawyers came on and just destroyed my argument, literally
14:13 Speaker 01 destroyed my argument where I posted a post saying, "Look, you're right, I'm wrong." And I took down my post that ended up being wrong. And I love those scenarios where I get to take people on and check my whole card. So to answer your question, I don't mind putting myself in the mix to have people question me and I actually enjoy it because I want to know that I can check my whole card and be confident in my position.
14:38 Guy Raz? All right, let's talk about another company that you that you got involved with in the past couple of years. It's called the Mark Cuban Cost Plus Drug Company.
14:46 Speaker 01 Yep.
14:47 Guy Raz? So MCC PDC for short.
14:52 Guy Raz? But I read that it started with a cold email.
14:55 Speaker 01 Yep.
14:55 Guy Raz? From somebody, from a radiologist named Alex Oshmiansky.
15:00 Speaker 01 Oshmiansky.
15:01 Guy Raz? Oshmiansky, yeah. Tell me, is that, is that what happened?
15:03 Speaker 01 Yes, absolutely. Believe it or not, I've probably invested over $100 million into people I've never met in my entire life from cold emails or cold calls or whatever it may be, and done really well with those investments. You know, and so Dr. Alex emailed me and he was a radiologist, you know, a mathematician, just one of the smartest humans I've ever met. And we started going back and forth about the ills of the drug and pharmaceutical industry. And he was working on starting a compounding pharmacy that would allow him to sell drugs for less, but would be, in his, that particular case, more difficult to scale. And this is four years ago, give or take, right around the, you know, when there were still discussions going on about the pharma bro.
15:48 Guy Raz? You're talking about Martin.
15:49 Speaker 01 Drexel, yeah, and Deraprim, yeah. And I was like, if this guy can raise prices 750%, why can't we cut prices? You know, this market forces go both ways. And so we started digging in further and we decided to create our own company, the Cost Plus Drugs Company. And Go through the process of getting all the documentation we needed, developing relationships with manufacturers and distributors and the like, and all the state regulatory agencies and federal regulatory agencies. And that took us, you know, close to four years with the goal of being the low-cost provider of any and all drugs that we're able to sell. Period. End of story. And on July 19th, we launched costplusrugs.com. Wow.
16:34 Speaker 01 And right now, we were selling, well, we're about to add about 60 more. So we'll go up to about 175 drugs. We're fairly positive. We are the low-cost provider, cheaper than you would pay for your copay with insurance. And by the end of the year, we'll be up to 2,000.
16:51 Guy Raz? Mark, stick around for just a moment. We're gonna take a quick break, and we're gonna come back and talk more about this business and how you're disrupting the pharmaceutical industry. We'll be right back. You're listening to How I Built This Lab.
17:04 Guy Raz? Does your team want a website that looks and feels handcrafted, but is still fast to ship? Well, Framer is built exactly for that. With Framer, you design on a visual canvas with responsive layouts, hosting, and a CMS built in. So the work is production-ready from day one, and you can get it done with help from Framer's AI agents. Framer is the AI website builder that helps creators, teams, and businesses ship production-ready sites faster than ever while getting every detail right. Prompt, inspect, edit, and publish in one place at a whole new pace. AI agents and humans work together. The agents bring speed and scale,
17:48 Guy Raz? and people bring taste, judgment, and control. Learn how you can get more out of your site from a Framer specialist or get started building for free today at framer.com/built for 30% off a Framer Pro annual plan. That's framer.com/built. Rules and restrictions may apply. AI isn't just opening new business opportunities, it's changing the way businesses get work done. The questions they ask, the decisions they make, the routine tasks they can hand off. That's the idea behind NetSuite Next, the next generation of NetSuite with AI woven into the tools your business already relies on. NetSuite Next surfaces insights
18:33 Guy Raz? exactly when you need them, puts agents to work on routine tasks and problems, and lets you ask complex questions in plain language, like talking to a knowledgeable colleague. But technology is only part of the story. AI is also reshaping how people and teams work together, and that shift is already underway. That's why NetSuite wants to put a new, expert-created business guide in your hands today. It's called "Aligning for the Agentic Era: How AI is Changing Everyday Work." And right now, it's yours, absolutely free. Inside, you'll discover how AI could reshape work across your entire organization, and how to position your business to prosper from it. If your revenues are at least in the seven figures,
19:18 Guy Raz? get NetSuite's free business guide, "Aligning for the Agentic Era: How AI is Changing Everyday Work", at netsuite.com/built. The guide is free to you at netsuite.com/built. netsuite.com/built.
19:35 Speaker 02 Confidence. It's listening to your gut. It's moving forward even when the path ahead is unclear. For nearly 160 years, Pacific Life has helped people keep their promises, building confidence for generations. Whether you're confident in your financial future or just beginning to envision it, we're here to help. Ask a financial professional how. Pacific Life, the power of a promise. Pacific Life Insurance Company, Omaha, Nebraska. And in New York, Pacific Life and Annuity, Phoenix, Arizona.
20:12 Guy Raz? Hey, welcome back to How I Built This Lab. I'm Guy Raz. And my guest is Mark Cuban. So, Mark, all right, let's break this down a little bit. Because back when you were on the show in 2016, I asked you about your first business. You were helping people install software on their computers, and you were building computers. And I remember I asked you, how'd you know to do that? Because you didn't have a tech background. You said, I just opened up manuals and taught myself how to do it. And at the time, you said... Let's actually, let's take a listen to what you said at the time.
20:42 Speaker 01 You know, one of my strengths has always been being able to put myself in the shoes of any type of business. You got a shoe store? Okay, I understand how that works. You got a bank? I understand how that works. You've got an oil refinery? I'll figure out how that works.
20:57 Guy Raz? All right, so clearly, you have taken this approach to all the things that you've been involved with. Walk me through how you educated yourself around the pharmaceutical industry. It's a very complex industry.
21:10 Speaker 01 Yeah, no question.
21:11 Guy Raz? You know, if somebody cold emails you and says, "Hey, Mark, let's fix this. Let's disrupt it." That's great, but there's a lot that you have to learn before you start. So where did you start?
21:22 Speaker 01 I started reading. I started reading every journal and every industry newsletter I signed up for and read. You name it, I got my hands on it and dug in, whether it was some of the legalese, whether it was understanding how pharmacy benefit managers worked, what's happening in the insulin industry, why prices were the way they were, understanding the consolidation that took place and how that impacted pricing, reading these things called med pack reports from governmental agencies that investigated pricing and issues there, reading single payer reports. Everything that I can get my hands on over the last four-plus years now
22:06 Speaker 01 regarding healthcare and pricing, I read. And that's what prepared me to be able to do this and to make decisions on it.
22:12 Guy Raz? The basic understanding, I think, that most of us have is that the reason why drug prices are, tend to be high, right, non-genetic drug prices tend to be high is because the pharmaceutical companies are spending so much on R and D and the, you know, the approval process and it takes years and years of clinical trials and it's, it costs millions and millions of dollars and they have to recover their costs. Is that, in your view, a false narrative?
22:37 Speaker 01 That's half true. And the reason why it's half true is that, like any business, every drug has a life cycle. There's the, you know, investigation, the research, the preparation, the trialing, then the marketing and potentially selling. And then, once you get a patent on it, you've got a 20-year life cycle. So for, there is a significant investment phase that goes into developing drugs. Not all drugs, though, because often a lot of that investigation and research process is taken up by the National Institute of Health.
23:11 Guy Raz? Government-funded, basically.
23:12 Speaker 01 Yeah, basically government-funded. And, you know, and so we can go into a whole different discussion about how we license those drugs as a country to pharmaceutical companies, but that really isn't the biggest impediment to keeping drug prices low. There are effectively, the way that drug industry is now, the process that takes a drug, once it's been manufactured, put aside all their R and D and the development and the trials. Once that drug manufacturer starts making a drug, the process it has to go through to get to the patients is ridiculous, it is stunted, it is manipulated by companies that
23:56 Speaker 01 have become vertically integrated, incorporating insurance companies, healthcare providers.
24:03 Speaker 01 Big pharmacy chains and these things called pharmacy benefit managers. And they game the entire system as it applies to Medicare. And how pricing is done there by creating very significant retail prices. Because the prices are set for Medicare as a percentage of that retail price. There are rebates that are paid from manufacturers. To the PBMs that go into the pockets of the PBM. So there's so many games that are played to distort pricing. What we decided to do was just come in and not play the games. And so rather than working with insurance companies, which we don't do at this point in time. Um, we are completely transparent, you know, so if you go to costplusdrugs.com.
24:47 Speaker 01 Put in the name of the drug and if we carry it, we'll show you our cost.
24:51 Guy Raz? Right.
24:52 Speaker 01 And then we will show you our markup, which is 15%. Then we charge $3 for handling through our pharmacy partner, TruePill, and $5 for shipping. And that's it.
25:03 Guy Raz? Right.
25:03 Speaker 01 And so all the complications that are introduced by these pharmacy benefit managers. And the big companies that they are part of. We eliminate and that allows us to sell our drugs almost always. For less than the copay that you have for your insurance. And the irony of that is that because they're not, because of that. We're making those insurance companies a little bit more money. Because the, the insurers, the patients are not using their insurance to buy the drugs from us.
25:31 Guy Raz? If in fact, right, if in fact, the, the, the reason why, or the primary reason why so many prescription drugs are so expensive is because of essentially all the kind of the middlemen, right? All of the people involved in distribution and marketing and sales and so on. Why, why haven't there been attempts to disrupt it in the past? I mean, I would imagine.
25:50 Speaker 01 There have been.
25:51 Guy Raz? There have been.
25:51 Speaker 01 But typically what happens, those companies get bought. You know, and so somebody, an entrepreneur like myself comes in and says, wow, this is an opportunity to disrupt. Let me create a company um that disrupts. And so they take one of, one of a couple paths. One, they start building the company and it gets bought and that entrepreneur makes a lot of money and that person's happy.
26:11 Guy Raz? Yeah.
26:11 Speaker 01 Or two, they. Play the game where they'll work with the pharmacy benefit managers as is. And they'll go out there and they'll find the lowest cost available. So there's companies and I don't want to go into naming them because they're doing the best they can. Where they'll say, okay, if you go to this Walmart down the street, you can buy this drug for $62. And if you go to Walmart across town, it's $48. But the craziness of it all is that it's the same drug priced at different prices. Even within the same retail chain, but different based off of the discount card and the location. And what we said was that's ridiculous because that means the patients can't have any confidence in what they're going to pay next for their drug.
26:55 Speaker 01 And so the other delta and why this is more difficult than it sounds is A, because it's expensive. And B, we're able to keep it low because I don't need to make money. I just need to make enough to keep this thing investing in.
27:08 Guy Raz? Right.
27:09 Speaker 01 In being able to manufacture and grow. And so we're a primary benefit corporation as opposed to a typical, you know, subchapter S or.
27:17 Guy Raz? Right. And we should, we should explain what that means. A public benefit corporation is a for-profit but operates with nonprofit principles, basically.
27:24 Speaker 01 Correct. So that allows us to make some money, you know, the market up 15% and invest it in a, you know, we're doing a manufacturing facility in Dallas so we can push our prices even lower.
27:33 Guy Raz? Yeah. So walk me through how you do this. I mean, because I think you sell 200 drugs, generic drugs. Presumably you have some manufacturer that's making them for you. And then you make them available to your customers. But essentially, the margins on this, right, are not, I mean, you're not talking about a company or a business model that can make, you know, hundreds of millions of dollars a year.
28:01 Speaker 01 Correct. Because if it was looking like, let's just say we get up to over the next three years, 3,000 or 5,000 drugs, including brand names. If it looked like I was making $100 million a year, I would either invest that in creating a new, you know, manufacturing existing drugs that I can get a license to, or I would lower my prices some more.
28:21 Guy Raz? So really, the reason why this doesn't happen more often is because essentially what you're saying is in order for it to work, you have to be a rich guy like you who doesn't really care if it makes a whole lot of money.
28:32 Speaker 01 Effectively, and you also have to have a platform. I've never put my name on a company until now. And the reason I did that was because I do have a platform and it would be a lot easier for people to associate it with me. And two, in 30 years from now, you know, or let's say 50 years from now after I'm gone, you know, that the goal of the company will still, you know, carry on, that this is a cost plus drugs company. And, you know, people see my name attached, they'll ask why, or they'll know because I've talked about it for decades, that this is meant to be the low cost provider for every drug we sell.
29:09 Guy Raz? You're working with a third-party fulfillment center, I think called TruePill.
29:14 Speaker 01 TruePill, right.
29:15 Guy Raz? What's in it for them? I mean, why wouldn't they just kind of take your model and do it on their own?
29:20 Speaker 01 Well, it's hard to run two different businesses, right? It's hard to be someone who's a fulfillment center or pharmacy, in their case, that fulfills for mail order and also know how to sell and resell at retail and to develop all their relationships and do manufacturing and invest that money. You know, it's expensive just to do what they're doing, let alone doing what we're doing in addition.
29:43 Guy Raz? You know, it's interesting because we often hear about Europe, right? And the same drugs manufactured by the same pharmaceutical companies, many of them US-based companies, are just much, much cheaper there. Is that primarily because they don't have the same kind of PBM structure and insurance cost structure?
30:00 Speaker 01 Yeah, there's just different laws and regulations. And plus, the companies that are doing the selling over there, you know, every sale is on the margin profitable because they've covered their costs in the United States. And so they do everything they can to keep their pricing high and their margins high here. And that makes it easier to sell, which means there's less friction in selling to all those other countries.
30:24 Guy Raz? You know, it's interesting because you think about like air travel, right? And so adjusted for inflation, air travel is much, much cheaper today than it was thirty, forty years ago, right? It was, it was not something that everybody could do all the time. And, and you know, consumer electronics, the cost of, of consumer electronics today, adjusted for inflation, much lower today than it was forty years ago.
30:43 Speaker 01 Yep.
30:43 Guy Raz? In part because so much of it comes from overseas. I, I wonder if the same principle might apply to, to prescription drugs. I mean, is, is your kind of model, is the idea that it will force the, the manufacturers and all the middlemen, you know, that it will force the market to essentially follow your lead?
31:01 Speaker 01 Yeah, it's interesting. It's a great question. So there's two pieces there. One, in terms of manufacturing and putting the actual physical production cost and getting that lower. And the answer is yes. We're, you know, I mentioned, we're spending a lot of money on a plant here in Dallas, and it's going to be driven by robotics so that we can go through and take any, a given pill and manufacture one year or two years worth of supply, switch it over to another pill and do the same thing over a short period of time and push the cost of the production of that pill down below what we buy it today. And since everything we sell is cost plus fifteen percent, that by definition will force the pricing down.
31:44 Speaker 01 And then the second part is, as we grow and we compete, then they're going to have to respond to us. And my, my greatest fear is, you know, they're going to, they're going to be great lobbyists, you know, and try to, you know, push us out of business simply because of what we're doing to their business. And I think without question, it will have an impact, but right now we're too small for them to care.
32:07 Guy Raz? Mark, hold tight for just a moment. We're going to take another quick break. We'll be back with more of Mark Cuban in just a moment. You're listening to How I Built This Lab.
32:55 Guy Raz? Hey, welcome back to How I Built This Lab. It's Guy Raz here with Mark Cuban. We're talking about his new drug company that is working to make drug prices much, much lower. Let's talk about manufacturing. So you're investing in an actual facility, a plant, that is going to make and manufacture drugs.
33:13 Speaker 01 Yep.
33:14 Guy Raz? How does it work? I mean, can this one plant, will it be able to make thousands of different drugs?
33:21 Speaker 01 No, we won't be able to, you know, it's not going to churn out a billion dollars worth of drugs each and every year, but it's a starting point for us. And once we're able to establish enough volume, we'll be able to build another one, then another one, you know, across the country. So no, this one facility will not be able to cover all the bases and all the volume. But, you know, let me take a step back. Our challenge to scale is not dependent on us building our own manufacturing facilities. Part of the challenge is getting manufacturers to sell to us because they're afraid of the response they'll get from the insurance companies. So if, and, you know, they have the ability to scale and push their costs down the same way we do.
34:04 Speaker 01 But they're afraid because, imagine this scenario, you're a PBM that's part of a big insurance company, and you go to a branded manufacturer and you say, "Look, you know, if you sell to Cuban and his cost plus drugs, we're going to yank you off of all these hospitals that we buy for, and we're going to yank you from the formularies that this insurance company that owns us approves." And so that's been our biggest hurdle. And when you hear all this talk about regulating prices of drugs by different politicians, they're not solving the problem, they're creating different problems. The reality is that the solution is trying to make sure that all these manufacturers
34:48 Speaker 01 sell not just to us, but any qualified resellers/distributors. If we're able to do that, then the door is open to competition besides just me. Because, look, at the end of the day, if I'm the smallest Player because the big guys have come in and undercut my prices. I'm happy as a clam. And so are millions of patients who are paying a fraction of what they were last year. And so, you know, it it really comes down to not can we build multiple manufacturing plants? But can we get the manufacturers of brand name drugs to work with us? And not be fearful of these big behemoth vertically integrated pharmaceutical companies. Precluding their drugs from being sold.
35:34 Guy Raz? So it's not the manufacturers that is the obstacle here. It's it's the insurance companies?
35:39 Speaker 01 More often than not, it's not the manufacturer. Like you'll hear the insulin industry show data that says their actual sales price has gone down over the years, not up, but you know, every diabetic will tell you that dealing with buying insulin is expensive and impacts their lives. And every now and then there are coupons that give them a month, you know, to feel okay or a couple of months. But, you know, it's not the insulin manufacturers for the most part that are distorting everything. It's it's the these vertically integrated companies. Not all are owned by insurance companies, but for the most part they are.
36:12 Guy Raz? Are you guys selling insulin?
36:13 Speaker 01 No, not yet. No, we hope to, but again, it takes somebody being able to sell to us. And they're afraid to sell to us right now.
36:21 Guy Raz? And and so right now, essentially, these vertically integrated companies are maybe not yet, but eventually they're going to start telling manufacturers they cannot sell to companies like you because you are not willing to work with insurance companies, right?
36:34 Speaker 01 It's not that we're not willing to work with insurance companies. We're just not going to put ourselves in a position where we have to distort our prices. You know, our mission is very, very simple. If you go to costplusdrugs.com, you're not going to see bells and whistles. It's very simple. There's not going to be telehealth. There's not going to be big name doctors writing articles and blog posts and podcasts.
36:54 Guy Raz? Yeah.
36:54 Speaker 01 None of that at all. Our mission is very straightforward. We want to be the low cost provider of every drug we sell. And with that definition, we can't work with an insurance company that is going to require rebates or anything like that. And that's part of what distorts. Pricing. Now, not all insurance companies do that. There are some that have come to us and said, we want to work with you. We're not, we don't own a pharmacy chain. We don't own hospitals. We don't own pharmacy benefit managers. So we want to work with you. So not all insurance companies are bad guys. Not even all PBMs are bad guys. There's just a few that really have the most power that initiate the distortion in pricing.
37:36 Guy Raz? Mark, is this a, is this a business that you think you would go out and raise money for? I mean, you've got your own money, but you couldn't, even with your money, you couldn't finance a massive drug company.
37:46 Speaker 01 You know, I haven't so far. This is kind of like the one thing I've said, okay, sorry, kids. You know, your inheritance is going to maybe reduced if it doesn't work.
37:58 Speaker 01 Just because it's that important to me. You know, you've heard me say, I'm the luckiest guy in the world financially, and I've been incredibly blessed. I try not to take it for granted, and this is a chance, you know, to have Alex reach out to me and to have him be as smart and as good at his job as he is. And another gentleman, Ryan Klein, and the people they've hired, they're, you know, I might write the checks and I might be involved strategically, but they make it run day to day to day to day. And while it's a big check and it's a lot of them, the impact is so great, that's worth more to me than the money.
38:34 Guy Raz? It sounds like this is the big swing for the fences that you are taking, right? That you, there's a problem that you were exposed to, and you realize that you could have an impact.
38:45 Speaker 01 Yep.
38:45 Guy Raz? And so you're putting money into this project. Do you think that, that people who have lots of money have responsibility to do things like that?
38:55 Speaker 01 I'm not going to judge for other people. Everybody's got to make their own choices. You know, like, people will ask me, well, how come I'm not going to space and all this and that? But, you know, you can question the motives of the Elons and the Jeff Bezos, but when, when I've read the stuff that they've written, you know, I kind of see their, their thought process that if we screw up this planet, what's next? Things that seem so insane and so grandiose and so outrageous. Today, you know, a hundred years from now, kids may be reading in textbook or whatever, however, they're reading or consuming information and being educated about how, you know, those guys or whoever helped save the planet. There's just, I'm not going to judge because everybody's
39:38 Speaker 01 got their reasons. And sometimes there's things that we can't see, even if, you know, it looks more self-involved than than maybe we can see.
39:47 Guy Raz? So you're you're putting money into a problem that needs to be addressed, right? Prescription drug prices.
39:53 Speaker 01 Right.
39:54 Guy Raz? Presumably, there are other issues that that you're looking out at. I mean, what what's something else that you might, down the road, you know, put some real money behind that may not make you money, but may actually help solve some problems or move the needle?
40:09 Speaker 01 You know, I think crypto plays a role in that, too. There's these things called Distributed Autonomous Organizations, DAO.
40:14 Guy Raz? Yeah.
40:14 Speaker 01 Which I think can evolve to be the best of progressive goals of allowing workers to participate in all upside and capitalist goals where, you know, people who come up with great ideas using these DAOs can be well rewarded while also rewarding all the people who participate. You know, so I think that creates a new type of organization that can have a significant impact. I think there are better unions than unions in a lot of respects. I think artificial intelligence, right now, we've bifurcated into a world of those companies that are great at AI and everybody else. And if you look at the top 10 market cap companies in the United States, all but Berkshire Hathaway with Warren Buffett are companies that are
40:59 Speaker 01 amazing at AI. And so, you know, I like to support entrepreneurs and, you know, we started a foundation teaching high school kids in underserved areas how to start learning about AI. And so, you know, I think it's incumbent upon the United States of America to train more kids and more engineers and more data scientists, et cetera, to be great at artificial intelligence, because it has such a global impact and in turn, has an impact on medicine and impact on so many other things outside of just generic business that will change the world. And so, you know, my hope is that we as a country can lead the way. And that's
41:43 Speaker 01 only going to happen if we invest a whole lot more than we're investing now in educating kids.
41:48 Guy Raz? That's Mark Cuban, owner of the Dallas Mavericks, serial entrepreneur, and now founder of the Mark Cuban Cost Plus Drug Company. Thanks so much for joining us.
41:57 Speaker 01 Thanks, Guy. Thanks for having me on. This is amazing. I really enjoyed it.
42:02 Guy Raz? Hey, thanks so much for listening to How I Built This Lab. Please do follow us on your podcast app so you always have the latest episode downloaded. If you want to follow us on Twitter, our account is at HowIBuiltThis and mine is at Guy Raz. And on Instagram, I'm at Guy.Raz. If you want to contact the team, our email address is [email protected] . This episode was produced by Chris Messina with editing by John Isabella. Our audio engineer was Neil Rouch. Our music was composed by Ramtin Arablouei. Our production team at How I Built This includes Alex Chung, Carla Estevez, Casey Herman, J.C. Howard, Liz Metzger, Sam Paulson, Kerry Thompson, Catherine Seifer, Josh Lash,
42:45 Guy Raz? and Elaine Coats. Neva Grant is our supervising editor. Beth Donovan is our executive producer. I'm Guy Raz, and you've been listening to How I Built This.
Previous PayPal: Max Levchin (Part 1 of 2) Next Affirm: Max Levchin (Part 2 of 2) Page updated October 19, 2026 · transcript and summary are machine-generated
