Cheap medicine, the "legacy of life" that Mark Cuban bet on

Text/Jemima McEvoy

As soon as Mark Cuban opened his cell phone mailbox, one email after another began to fill the screen. "Don't, don't, don't..." he said as he threw every email into the trash almost without thinking.

First a message titled "Desperate Request", deleted; This was followed by an email about a cryptocurrency asset project he was pushing — a project in which Cuban agreed to buy the digital rights to the drawings of one of the architects of the World Trade Center and plan to convert it into an NFT. He squinted his eyes at the email, the font was too small, then the next one. Finally, he saw an email from an aspiring entrepreneur and showed kindness for the first time: "I like these guys, and I'm going to keep them useful later." ”

The real-life Cuban and his 11-year role in "Shark Tank" — or, from a TV series perspective, 13 seasons — aren't much different. He listens to everyone's opinions at least briefly before making a quick judgment; His personal email address is public ([email protected]), and he clicks on every email he develops, even if it is a scam, spam, or sales campaign. Why? Because I can't control myself. "For me, this is a race that I play in, and I'm already very good at it. Even when I reach the age of 110, I still respond to emails. ”

The entrepreneur has founded more than a dozen companies, starting with MicroSolutions, a software distribution company in 1983, all the way to Cost Plus Drugs, a pro bono company he founded in January 2022, which works to reduce the price of prescription drugs. In 1999, when the dot-com bubble peaked, Cuban sold the online sports broadcaster Broadcast.com to Yahoo for $5.7 billion (a few years later, Yahoo shut down the service). Currently, Cuban has invested at least $25 million in cryptocurrencies (including Dogecoin, which was initially considered a joke), and invested in at least 400 startups, many of which have been invested through Creator Winner.

Some of Kuban's bets have been successful, and some have been thunderous, but even after more than 20 years, Broadcast.com is still the main reason for his $4.6 billion fortune. Broadcast.com was not founded by Cuban, but by Chris Jaeb in 1992; Three years later, Cuban and his college friend, Todd Wagner, joined the company, who also became rich because of Broadcast.com. It is estimated that the sale of Broadcast.com brought in after-tax gains of $1.1 billion to Cuban; The following year, he spent $280 million to buy a majority stake in the NBA's Dallas Mavericks (now renamed the Dallas Mavericks) and once again paid off handsomely. Forbes estimates that Cuban's 85 percent stake in the team accounts for almost half of his fortune and is worth $2.2 billion.

"I understand that no one should have that much wealth, but that's the reality." Cuban said, "I tried my best, I don't feel guilty about it at all, I worked hard to get to where I am now." ”

Cuban is one of the few rich people who seems to be really enjoying wealth. As a young man, he bought a sprawling mansion in Dallas, an apartment on Central Park West Road in New York City, and a private jet to travel the world and party "like a rock star." More recently, he has been posting advice on Creator Winner and Twitter (where he has 8.8 million followers), buying drinks for strangers, and talking to anyone who wants to listen.

Today, Cuban still spends money on interesting things. For example, he recently bought the zero-population town of Mustang, Texas, as a gift to a dying friend ("this counts as his big asset") and appointed another friend of his as mayor of the town. Cuban had thought of filling the ghost town with life-size robotic dinosaurs, and the idea came from an entrepreneur in Creator Winner, but it was later considered impractical. For other ideas, Cuban does not refuse, just email him.

Compared to the robot dinosaurs, Cuban's new pharmaceutical company, Mark Cuban Cost Plus Drugs, has a very different level of seriousness, positioning it as a "prescription" to curb the soaring price of prescription drugs. Since its inception nine months ago, Cost Plus Drugs has offered steep discounts on about 350 different generic drugs. At the local CVS drugstore, the cholesterol-lowering drug, Generic Crestor, costs $151 a month, which is already a big discount compared to the $329 brand-name drug, but the price of the Cuban is $4.8. The same goes for the diabetes drug Glucophage, which sells for $20 at CVS and $3.90 at Cost Plus Drugs. There's also a generic version of the antidepressant Zoloft, which sells for $50 for CVS and $4.20 for Cost Plus Drugs.

Cuban is able to offer such a low price because he bypasses many of the pharmaceutical industry's middlemen, including the Drug Benefit Manager (PBM) who negotiates prices (a large and opaque industry with market leader CVS Caremark achieving $153 billion in sales by 2021). The Cuban approach is to buy these drugs directly from producers, pay them enough to make them feel worthy, and then sell them online at a fixed markup of 15%, plus $8 in shipping and other charges.

It's not a completely new idea, and Walmart and Costco have tried something similar. But perhaps because of his fame, Cuban is quickly gaining attention. At present, Cost Plus Drugs has claimed to have more than 1 million customers and said that its performance is growing at a rate of about 10% per week, which is expected to be profitable in 2023. Cuban was uncharacteristically tight-lipped about the company's revenue, but Forbes estimates that Cost Plus Drugs had sold at least $25 million in the first nine months.

Cuban noted that this is the first time he has used his name in a company name, and that he has invested nearly $100 million in the company. He said he was very invested in the idea and was willing to "do whatever it takes." In his own words, it was a kind of "legacy." If we get it right, it will be the most impactful thing I've ever done. ”

He also insisted he would be dropping out of other projects to focus on Cost Plus Drugs, and he was even considering quitting Creator Winner. "I kind of want to leave. Without me, the show would have lived well. ”

Friends and family would describe Cuban in the same way: he was a born entrepreneur. Growing up in Mount Lebanon, a suburb of Pittsburgh, Pennsylvania, to working-class parents, Cuban is the eldest of three sons who grew up impressed by his ongoing money-making plans.

"He's always doing things and he's always busy trying to make money." Jeff, the younger brother who runs Cuban's entertainment assets, said. These entertainment assets include film distribution company Magnolia Pictures. During a strike by printers in Pennsylvania, Cuban got up before dawn and drove 130 miles to Cleveland to buy newspapers and take them home to sell.

As he grew older, Cuban became more and more ambitious. As a soon-to-be senior at Indiana University, he borrowed enough money in begging way — even using his own student loans — to buy a local bar, Motley's Pub. It was in this bar that he met his future partner in Broadcast.com, Todd Wagner, who was later forced to close because of drinking problems with minors. In August, Cuban returned to the bar (now called Kilroy's on Kirkwood) and left a $10,000 tip after buying 100 glasses of wine for customers.

"He knew from an early age that he would either succeed or go bankrupt." Jerry Katz, who has known Cuban since kindergarten, said.

At the age of 32, Cuban sold MicroSolutions to CompuServe, an early online service company, for $6 millionaire, and became a millionaire. He then decided to retire, but it didn't last long. In 1995, Netscape went public, and he and Todd Wagner acquired Broadcast.com. At the time, the company, named AudioNet, was struggling to find ways to provide live sports in the field, even experimenting with shortwave broadcasting, and Cuban and Todd Wagner moved the idea to the Internet. With Web 1.0 booming, Broadcast.com set the record for its best-ever IPO, with a market capitalization of $1 billion on its first day of listing, more than 300 times its $3.2 million in sales. A year later, it was sold to Yahoo.

For bubbles, Cuban has a keen sense of identity. He and Todd Wagner were rewarded with Yahoo stock, but one smart thing the former suggested was to use a "Collar" strategy to limit the gains when the stock price rises and the losses when the stock price plummets, which Cuban readily admits is his time. "Luck is an important part of everyone's success."

Since then, Cuban and Todd Wagner have collaborated on several projects, including the Mavericks, who are worth about $1.8 billion. He believes that Kuban has not only had luck behind it along the way. "I think Mark always had an ability and still has it, and that's that he can see what's going on around the corner. I think Mark is the smartest and most prepared person I know. ”

While Cuban loves money, he may prefer to be famous. In 2004, he appeared on the television show "The Benefactor," ABC's response to the Trump-hosted reality show The Apprentice. In this show, 16 contestants compete for the $1 million prize money offered by Cuban. However, the show was cut after a season of airing. Later, Trump wrote to Cuban to comfort the latter's "terrible" and "embarrassing" efforts, adding, "If you decide to do another show, please call me and I'd love to lend a helping hand." Later, Cuban ushered in new hope: he met producer Clay Newbill, the same person who recruited Cuban into Creative Winner. In 2009, Cuban did not participate in the pilot episode of the show, but joined as a "guest mentor" in the second season of 2011. Since then, he has appeared in every episode.

"In a way, everyone wants to be a celebrity." Cuban said. In addition, he has appeared in dozens of TV shows and movies as a real person, including "Entourage" and "Brooklyn Nine-Nine."

Like other Hollywood types, Cuban has become obsessed with NFTs and even owns a CryptoPunk (No. 869, currently worth $95,000). He was a key supporter of NBA Top Shot and even founded the NFT platform Lazy.com, where he showcased his personal collection. In March 2021, the Dallas Mavericks became the first NBA team to accept Dogecoin as a form of payment — and incredibly, although the cryptocurrency has plummeted 90% since last year, it is still accepted by the team. It's a big shift for Cuban, after all, he quipped back in 2019 that he "would rather have a banana" than Bitcoin.

Last October, the Dallas Mavericks signed a five-year partnership agreement with Voyager Digital, one of the fastest-growing publicly traded cryptocurrency brokers in the United States. After that, however, Voyager Digital evaporated 99 percent of its value and filed for bankruptcy, leading a group of clients to sue Cuban, saying his deceptive endorsement had allowed ordinary investors to invest $5 billion (now frozen) into the platform. Cuban was reluctant to comment on the lawsuit, saying only that it would not stop him from promoting cryptocurrency.

For both Cuban and Alex Oshmyansky, co-founder of Cost Plus Drugs, the company's creation and growth were the result of years of gestation. Alex Oshmiyansky, a radiologist from Colorado, and some of his doctor friends came up with the idea of selling generic drugs at production costs in 2015. For the idea, doctors saw it as a nonprofit and spent three years looking for funding. "We did a mess. Except for the money I invested myself, I didn't raise a penny. Alex Oshmiyansky, who invested $200,000, said. So he changed direction in 2018 and re-registered a non-profit company, meaning he could run pharmacies as businesses rather than charities. Just then, Cuban joined.

Cuban's initial investment was small, only about $250,000, but he gradually ramped up as the company made progress in overcoming regulatory hurdles and convincing hesitant drugmakers to get involved. It took them a full year to convince the first drugmaker, New Jersey-based Amneal Pharmaceuticals, to agree to make drugs for Cost Plus Drugs. At first, Cost Plus Drugs only offered 100 drugs from three drugmakers; Today, it works with 20 production partners to add about 100 new drugs every month.

In addition, Cost Plus Drugs plans to manufacture its own medicines, and its $11 million, 22,000-square-foot manufacturing facility in Dallas will open in November. The all-robotic factory is designed as a "flexible" facility that can quickly divert production to any drugs that the company can't get from other drugmakers.

While Cost Plus drugs have many advantages, it also has some limitations, such as it doesn't accept insurance and doesn't sell drugs that are still patented, including best-selling drugs like Humira and the hypoglycemic drug Trulicity. "Our goal is to become a low-cost drug supplier. When we have our own brand of drugs, we surprise a lot of people. I don't think people know much about us yet... They underestimate our capabilities. ”

In addition to the pharmaceutical industry, Cuban is also considering intervening in higher education, another industry that is ripe for disruption. "One thing I would never do, and that was donating money to the school because they would only take the money to build buildings." A better approach, he argues, would be to streamline universities to the point where they only have infrastructure, skip "nice dormitories," fine dining halls, climbing walls and first-class league sports, and focus on recruiting the best teachers and keeping tuition levels low.

Cuban is not a pessimist in essence, but "one thing" disappoints him, and that is American politics. He disapproves of raising taxes on the plutocrats and believes the electoral process needs to be overhauled. "I want to destroy the two-party system." He said, "For me, that's the source of all evil." He had seriously considered running for president in 2020, but in a national poll commissioned by him, he had less than 25 percent approval and decided to give up.

Four years ago, Cuban celebrated his sixtieth birthday, and his birthday party was as grand as one might think. A group of friends and celebrities — including his colleagues at "Creator Winner," as well as singer Jennifer Lopez and her then-fiancé, Alex Rodriguez, a former New York Yankees star — gathered on the lawn of a 24,000-square-foot Dallas mansion under Cuban's name. Stevie Wonder and pop electronic music group Chainsmokers also sang live.

Toward the end of the dinner that night, Cuban walked over to his childhood friends Jerry Katz and Todd Reidbord. "He was so drunk that he couldn't do it, but he was very happy." Todd Reed Reedbod. "He put his arm around us and said, 'I can't believe this is happening to me right now.'" ”