Firing Line

>> The doctoring of American healthcare.

This week on Firing Line.

>> This is like nothing that gets me more excited in the morning after my family than coming in and wanting to **** the entire healthcare registry because it certainly needs it.

>> Mark Cuban is a billionaire entrepreneur who made his fortune in dot coms, bought the Dallas Mavericks, and starred in the reality TV show Shark Tank.

>> I'll give you the $400,000, but I want 16%.

>> 16%?

>> Now, Cuban is taking on health care with a mission to disrupt the American health insurance industry.

>> Literally, what those companies do defines the cost of health care in this country.

>> One job Cuban says he does not want is president of the United States.

>> I'm not gonna do it.

I've said the only way I would do it is if Trump tried to run for a third term.

>> What does Mark Cuban say now?

>> "Firing Line with Margaret Hoover" is made possible in part by... Robert Grainieri, Vanessa and Henry Cornell, The Fairweather Foundation The Tepper Foundation, Peter and Mary Kalikow The Beth and Ravenel Curry Foundation Pritzker Military Foundation, Cliff and Laurel Asness And by the following.

>> Mark Cuban, welcome back to "Firing Line."

>> Thank you for having me.

>> Over the last 40 years in the United States, drug costs have increased three times the rate of inflation.

In 2022, U.S.

drug prices were nearly three times higher than comparable developed countries.

And in President Trump's State of the Union address this week, Trump called health care costs, quote, "one of the biggest rip-offs of our time."

Why are Americans getting ripped off?

Well, the one thing from a business perspective that differentiates the United States versus all the other developed nations when it comes to drugs, we have these things called pharmacy benefit managers.

They don't.

Period.

End of story.

PBMs, pharmacy benefit managers who are purportedly middlemen between your insurance company and your pharmacy.

Right.

In 2018, you got this email from a radiologist complaining about drug prices.

Four years later, you start your own company, Cost Plus Drugs, and it is intended to offer fair price drugs, generic drugs, to the public directly without having to go through a middleman.

You are now today selling thousands of drugs to millions of customers and you have your own factory manufacturing medicines.

So in layman's terms, what is the problem that your company is solving?

We're transparent.

When you go to costplusdrugs.com, you put in the name of the medication.

If it's one of the thousands we carry, it comes up, and we show you our actual cost, our literal actual cost.

We show you our markup, which is only 15%, and if it's mail order, it's $5 to ship it to you.

That's it.

And so any medication that you make gets prescribed, you can check our price first.

And here we are four years later from our launch.

We're still the only pharmacy that publishes a price list.

And we update our price list every day.

Let's take a concrete example, imatinib.

Right.

Imatinib is a drug that treats chronic myeloid leukemia.

Right.

OK.

Today on GoodRx, the pharmacy prices it for 30 pills, 400 milligram tablets.

The range is from $94 to $4,000.

On your site, Cost Plus Drugs, it's $34.50.

Yeah.

Why?

Because GoodRx works inside the system, and they work with PBMs, they work with the insurance companies.

By going to costplusdrugs.com, we charge the same price to everybody.

When our costs go down, we pass through the lower price.

So first-- So if I don't go to Cost Plus Drugs, I don't actually know how much my drugs cost?

Pretty much.

Yeah.

And so not only do you not know what your drugs are going to cost, your employer doesn't know what they're paying for the drugs that you are using.

So that's part one, transparency.

Part two is fairness in pricing.

We only market up 15%.

And because we only market up 15%, people trust us.

And that's why they come to us.

We spend no money on marketing.

Zero.

Not a penny.

It sounds like what you're saying is you've identified that the problem is that an average consumer of drugs, of pharmaceuticals, has no idea what they cost because they have employer-provided health care or they have some other kind of health care benefit that just gives them their drugs for a certain price, but they don't know the actual rate.

So it's a -- what you're trying to solve is what you're trying to solve a market problem?

Yes.

It's the way the industry's structured.

>> Why have drugs gotten so expensive over the last 40 years?

>> Well, the way the industry is structured is you have these enormous insurance companies that, in turn, have -- You know, the biggest insurance company in the country has 2,600 subsidiaries, and they have $160 billion in intercompany transfers.

And they're so big, and they own doctors, providers, pharmacy benefit managers, some cases pharmacies, specialty pharmacies, they are so vertically integrated they literally control and set the pricing of all the economics.

So it's a lack of true competition in the marketplace.

Right, because there's such opacity, there's an information asymmetry.

You've got these big companies that set the prices for everybody.

And they know that not only does the patient not know if their co-insurance or co-pay is reasonable, they don't know what they're paying, right?

They are overpaying in many cases.

Many of our customers come to us despite having insurance because their copay or coinsurance is so high.

And then you have the employers who are paying huge premium.

Their share of premiums is getting bigger and bigger.

And they're having to pay the cost not only for the pharmaceuticals but also other health care.

They have no idea what they're paying.

Literally Margaret, I'll sit and talk to CEOs of companies.

And even though it's their largest expense after payroll, they have no idea how their benefits work.

They have no idea what they're paying for anything.

Okay.

According to the Pete Peterson Foundation, brand-name drugs account for 8% of drugs dispensed, but account for 84% of drug costs.

Correct.

How much difference can you make in a marketplace without touching the most expensive?

What we would love to cover and sell every drug that's approved by the FDA.

There's nothing we don't want to sell.

It's what we're allowed to sell.

And the reason they're stopping us is if you remember what I said that when you go to cost plus drugs dot com we'll show you our cost.

We only market up 15 percent.

The big PBMs need to market up much more.

So if we were to carry the brands and we showed what our cost was net after rebates and only marked it up 15%, we'd completely destabilize their pricing.

They're forcing you out of- Correct.

They want to keep you out of competing with them for as long as they can.

Okay.

I want to ask you about pharmacy benefit managers.

Sure.

PBMs.

PBMs.

You've referred to them.

Yes.

They are the Darth Vader of the pharmaceutical industry.

They call themselves middlemen between the insurance company and the consumer.

Right.

I go get my drugs.

I have a health insurance company.

I go to a pharmacy to buy drugs.

And apparently there's this thing called a pharmacy benefit manager that is supposed to be looking out for the prices of drugs.

Supposed to be.

So it's supposed to be a middleman.

But the truth is the pharmacy benefit managers are really owned by the insurance companies.

Or in one case, owns an insurance company.

So how can they be looking out for the prices if they're owned by the insurance companies?

They're not.

OK.

So they -- what is the role they play in the system in terms of preventing transparent competition?

We launched in January of 2022, and here we are more than four years later.

We are still the only pharmacy that publishes a price list.

There's no reason why they couldn't publish their prices.

They choose not to.

It's just, you know, the more information patients and employers have, the less money they make.

So the PBMs, the pharmacy benefit managers, argue that actually the problem is that drug manufacturers are jacking up their prices.

They say, they point to data showing that pharmaceutical companies have profit margins eight times higher than they do, the pharmacy benefit managers.

So how do you take on that argument?

If that's true, publish your prices.

It's one thing to say it.

It's another thing to prove it.

So they entirely benefit from lack of transparency.

Yeah, information asymmetry is their best friend.

If these companies came on Shark Tank, we would just tear them apart.

Okay, so progressive Democrat Elizabeth Warren and conservative Republican Josh Hawley, two senators, one from Massachusetts, one from Missouri, have introduced legislation to break up the big insurance companies and prohibit parent companies from owning both PBMs and medical providers.

So this is this gets at what you've said is the entire ecosystem and so what Elizabeth Warren and Josh Hawley want to do is break up essentially the collusion in the industry right?

So you have called that you've said you support the bill, you've called supporting it a no-brainer, but you also say you want to break up the big insurance companies.

Right, that's what they're talking about.

Okay, but they don't really want to break up the companies, they want to break up the collusion between all the parts of the health care delivery process.

Well, six of one hack does not the other.

Okay, explain that.

So, what I would love to see happen is that they divest all non-insurance assets because they're able to game the system.

So for instance, there's this thing called medical loss ratio that applies to different insurance plans, particularly the ACA.

And what it says is, of the premiums you collect, you have to spend 80 to 85% of them on actual care.

Well, if you're paying, if you own the doctor's effective or the providers, you can tell them charge us more.

Because if you charge me more, I hit my medical loss ratio sooner.

And if that profit stays in the hospital or the clinic, whatever it may be, it still belongs to my company.

And so you need to get them to divest all of these non-insurance assets.

It's the consolidation up and down the supply chain.

Right.

Right pocket, left pocket.

It doesn't matter.

They don't care which company they profit in as long as that profit is somewhere in their vertical integration.

So this doesn't so much break up the insurance companies themselves from providing insurance.

No.

But it what it does do is prevent.

It turns them back into insurance companies.

I see.

Right now they're everything companies and they control everything.

Literally what those companies do defines the cost of health care in this country and if you want to get into the details I'm happy to because it starts with the insurance plans.

And you know who gets the worst of it?

The people with the least amount of leverage and information.

Patients, independent pharmacies, and independent physicians.

Independent physicians are disappearing.

The people that have spent their lives wanting to work in small communities where if they retire it's a health care desert, they get paid the least of everybody.

Literally.

So the insurance companies will underpay them, late pay them, claw back, knowing that if they force them potentially go out of business, they can buy their clinic or practice and take control of it.

- Right.

So what you've done is you've identified a place in the system, drug pricing, where you wanna try to reform it through transparency, by creating a business that operates through transparency.

Have you found, in your experience, that doing this in the marketplace will be enough to fix the marketplace, or is this going to require a legislative or policy fix?

In other words, can the market fix this problem, or do you need policy makers to help you fix this problem?

The market can fix the problem, but it's going to take a long time and people are going to die.

And so that's why I'm a big fan of you know, the big insurance companies having to divest and then taking a look.

So you want a legislative fix or a policy fix as a way of just expediting the forms.

So if you can start with the insurance companies, then you go to the big hospital systems because they all are leveraging that information as asymmetry.

So if you keep going at the rate you're going, how long will it take you to disrupt the industry?

You know, we've been here four years, maybe five years more.

It's all about scale, right?

Right.

To turn it upside down.

But you also have big entrenched interests.

Oh, I don't care about that.

That really don't want you to, I know you don't care about it, but they're going to work hard to make sure you can't take out any of the market share.

That's what they do, but as long as I have patients that we're saving money and saving lives, they're going to tell each other.

Nobody, look, when you talk to people about health care, most people like their doctors, care about their doctors, and feel the doctors care about them.

When you ask them about the economics of health care, everybody hates it.

When you talk about insurance companies, they're the most hated industry in the country, right?

And so there's no love lost.

So when you give people an alternative, you may not be able to get them to switch, everybody to be able to switch immediately, but slowly but surely.

Don't you think you're uniquely positioned to do this?

Because you said you don't even have a marketing, you don't even have a marketing budget.

Correct.

Except for that you are a marketer.

Right, no, I've got a big mouth and a platform, so you're right.

Absolutely, I'm in a very unique situation.

My next dollar's not going to change my life.

And there's nothing more, this is like nothing that gets me more excited in the morning after my family than coming in and wanting to **** up the entire healthcare industry because it certainly needs it.

In the State of the Union this week, Trump touted his big achievement was bringing down the cost of drugs.

He launched Trump RX at the beginning of this month, early February.

This is a website that really, you know, it helps patients find medications, either by buying them directly from the manufacturer or using a coupon.

There are currently 43 medications available on Trump RX.

In some cases, there are cheaper generic versions on your site.

Yeah.

You were pretty optimistic about Trump RX when it started.

How do you assess the execution?

Look, there's no downside to offering medications for a lower price.

Competition's better.

So I'm all for Trump RX.

You know, I don't -- Republicans need medications, too.

You know, I'm not into the -- But Trump RX is a government site intended to offer drugs to all Americans, not just Republicans.

Right, no, and that's great.

And the point is, whatever gets people lower-priced medications, yes, sign me up.

Democrats published a report this week about Trump RX, accusing it of misleading Americans for not mentioning that lower-cost generic versions of some drugs are available in other places.

So Congressman Frank Pallone said that Trump RX is all hype and no true action, and Ron Wyden said it's really a glorified coupon book.

Is that fair?

>> I mean, it was a waste of time, right?

>> What was a waste of time?

>> Just plain, "Hey, Trump did it.

We hate it."

There's no -- When it comes to this stuff -- >> But do they have, like, a real criticism that -- You know, some of the -- I mean, if there's only 45 drugs on it, you have so many more drugs on your site.

Look, our prices are cheaper on 26 of them.

Right, yeah.

So, but it's just the beginning, right?

Give them a chance.

Anything that opens the door for lower-priced medications, I'm a fan of.

And so, right now, 43 drugs is not going to change the world, but it's a good starting point.

And will they get there all the way?

I don't know.

But we're going to help them wherever we can.

The criticism from Libertarians, right, so the other side of the political philosophy or political spectrum is that you're injecting the government into the market where private companies like yours are already innovating.

Right.

You guys are, you know, Cato Institute says that the government-run sites risk introducing "political favoritism, coercion, and regulatory corruption."

Mm-hmm.

Is that a valid concern?

Again, you know, shuffling deck chairs on a Titanic because we're going to kick their *** no matter what they do.

So I'm not worried about them.

Like, if I can't do better than the government, then something's wrong.

So ultimately, it sounds like you really think the marketplace should be able to fix this.

It's just a question of timing, you know.

And in this particular case, since it's health care, people die when it takes longer.

And that's the problem.

That's a function of the insurance companies and their PBMs, and that they say anything to the contrary, they're lying out their ***, because there's no reason why it needs to be this way.

And so can we get it done?

Yes.

There's so many more things that we're doing that we won't even have time to talk about.

But in the meantime, are we willing to let people die?

Remember Hillarycare?

Yeah.

So this program Firing Line aired for 33 years.

William F. Buckley Jr.

hosted it.

And back when the Clinton administration had come into office and Hillary Clinton and the Clinton administration were taking on health care, sort of for the first time in a generation really, Firing Line sponsored a four-part debate on health care reform.

Okay.

Here is a clip from one of those debates.

Take a look.

I've got the only plan that works and that's Medicare and none of the people here would call that socialism or vote against it.

>> It's just paying for it's the problem.

And the seniors love it.

All the seniors love it.

The doctors like it.

The hospitals survive with it.

>> And it's about to bankrupt the country.

Not necessarily.

It's a plan that's there.

Shoot at it if you choose.

But it has cost containment.

It has all the features that all of these wannabes would add.

But it has the advantage of it's empirical that works.

>> You know, Democrats today are still advocating for Medicare for all.

You have suggested that's unworkable.

>> To get there, yeah.

Not that it's a bad idea, but it's gonna be really hard, if not impossible, to get there from here.

>> So what, then, is the ideal solution?

>> I'm a proponent of universal health care, but, again, you can't just go from here to there.

When you read the legislation that's been offered by Bernie Sanders and Representative Jayapal.

The first thing it says right at the discretion of the Secretary of Health and Human Services.

>> What's the problem with that?

>> Well, you just don't know what you're going to get.

It's up to the president to appoint whoever that is.

And if they don't approach healthcare the way that you think healthcare should be approached, you've got a real problem.

>> You've been pretty critical of the president's tariffs.

You called them basically just gibberish.

I want to go big picture, how the tariffs have impacted the pharmaceutical industry.

What has been the impact of Trump's tariffs on the pharmaceutical industry and drug production.

What's your sort of assessment for how the tariffs have impacted at least the drug industry?

Yeah, that's an interesting question.

I think he used them as a negotiating tool.

And from that perspective, not an overall economic perspective, but in terms of medications, they work for him.

And it's basically kept your prices the same?

No, because the people that he's negotiated with are the brand medications, and we don't have a whole lot of access to them.

But what I will add that it's possible now using what we've learned with our manufacturing in Dallas, we're able now to take that plus AI we created so that we literally are able to manufacture all those generics that we buy from India, we can manufacture them less expensively in Dallas, Texas, except we have one issue.

That one issue is there's something called ANDA, which when you want to manufacture a new generic, you have to go to the FDA who has to approve your factory, and they charge $365,000 for each drug.

And so we want to manufacture 1000 of them, that's $365 million, which destroys the economics.

So if we're able to get a waiver, so if anybody from administration is watching, if we're able to get a waiver, we'll be able to move the manufacturing of those thousand generics to Dallas, Texas, and have it up and running within 18 months.

Wouldn't that fit President Trump's on-shoring effort to ensure that, I mean, if we had another pandemic, we don't have to worry about getting, you know, generic drugs from... 100%.

>> Have you talked to RFK about this?

No, but I've talked to the people that work directly for him.

And so they're aware of it, and, you know, in a couple cases, they're really supporting us.

So when you talk about, you know, government intervention and can we compete, yes.

We can absolutely compete.

We can absolutely change health care.

We can absolutely change the economics of health care.

But we're going to have to fight all these huge insurance companies.

And can we do it?

Yes, we've done it so far, and they're copying us rather than vice versa.

But the more help we get, the faster we can go.

One of the things I admire so much about you, you're clearly a problem solver.

You want to fix things, but you also have a servant's heart.

And you care about this country and you care about solving problems.

In 2024, you campaigned with Vice President Kamala Harris, who you endorsed.

But having now had a chance to reflect on this, and I know that Democrats from across the country are coming to you saying, "What should Democrats be doing differently?

What are Democrats been getting wrong?"

You have said Democrats can't sell anything.

I mean, here you are selling an idea, selling reform, selling health care, selling cheaper drug prices.

What are Democrats getting wrong, though?

Like, what can they learn from you?

Like, how do you assess?

-- >> Yeah.

You have to be a problem-solver first.

Democrats used to be a party of entrepreneurs.

>> Yeah.

>> They no longer are.

You know, it used to be people that were part of the party were focused on solving the problem, as opposed to creating policy first, because policy, creating policy in this environment, particularly, is all about getting elected first, as opposed to solving problems.

And I think they've got it backwards.

I think you have to solve problems, which demonstrates to voters that you're able to solve problems, and that they support people who can't.

Do you think Kamala wasn't able to do that?

She, Kamala, wasn't that she wasn't able to do that.

She wasn't given the opportunity to pitch any of that.

They could, Democrats, if you gave Democrats a chance to sell dollar bills for 50 cents, they would try to pass a law that made it happen before just doing it.

One of the things you've pointed out, you've pointed to Donald Trump, Zohran Mamdani, James Tallarico, the candidate who's running for Senate in Texas, as individuals who can leverage the attention economy effectively.

Is that what any candidate needs to be able to do?

Absolutely.

I mean, that's what you're doing.

So to be a successful Democrat in the next wave, I mean, I know they're asking you for advice.

Are you telling them you have to win at this attention game?

Yes.

You have to understand that in an algorithmic world where people get almost all of their information via social media, even older people, right?

I mean, they're on Facebook all day long.

Everybody has their own individual feed.

If you want to know what a person's all about, look at what their Instagram or TikTok or Facebook feed is.

And if you don't flood the zone, to quote Steve Bannon, right, if you don't flood the zone and do things that gain the attention of the algorithm and have it feed people, you're forgotten.

You're lost.

Look at when Donald Trump was saying they're eating cats and dogs.

It wasn't because he thought people were literally eating cats and dogs.

He knew he was smart enough to know that's how you get attention in an algorithmic world.

Mamdami here in New York, right?

He's Trump Jr.

He's a little clone of Trump.

You know, James Tallarico and Mamdani, you know what they have in common?

No.

They both grew up in an era where Donald Trump was the dominant politician that was dominated by social media.

And you look at Mamdani, brilliant at social media, right?

I told the Democrats, they should hire his team, pay him $10 million each to take them from him 'cause that'll get them further along than buying $50 million worth of ads on linear media.

>> Okay, you've said 100 times, "You are not gonna run for president..." >> Correct.

>> "...unless Donald Trump runs for a third term," which I don't think you really believe he's gonna do, but he joked about it in the State of the Union this week, said it should have been his third term.

>> Right, right, right.

>> I mean, is that your way of saying there's no way you really ever run?

>> True, yes.

>> So, you -- Are you a Democrat or a Republican now?

>> I'm independent, I think, for myself.

>> So, you'd never consider an independent -- 'Cause it's reported -- >> It would be fun.

>> You looked at an independent run for president in 2020.

>> No, I considered it, yeah, just because people were asking me about it, and I thought it was flattering.

>> Well, they haven't stopped asking.

>> No, I mean, I see polls all the time, and people send me that stuff.

>> There's a lot of private polling that suggests that you would be the best candidate for the Democratic Party.

Yeah, I don't know that I'd want to run as a Democrat.

I mean, I think it'd be more fun to run as a Republican just to try to turn things upside down.

But I think I, you know, I think I would have a chance, a puncher's chance, but I think I'd have the best chance by being an independent.

And the reason for that is people are sick of the Republicans.

People are sick of the Democrats.

We're sick of everybody just taking their own side and just being divided as a country.

And I think by saying, as an independent, yeah, I agree.

The Republicans suck and the Democrats suck.

Let's bring people together and focus on solving problems.

Because by definition, anything that an independent president does would have to be bipartisan.

>> That's -- It's so inspirational, but I know you looked at it.

Did you ultimately decide that an independent -- It's just so difficult mechanically in the country for an independent to win 'cause then it gets thrown to the House of Representatives.

>> No, I talked to my family, and they all voted against it.

That was 100% -- >> Who has the true veto in the Cuban House?

>> The whole family, not me.

That's for sure.

>> Well, kids will be older in a little while.

Mark Cuban, thank you for joining me on "Firing Line."

Thanks for what you're trying to do to help our country.

>> Thanks Margaret.

It was a lot of fun.

Thank you.

>> Thanks.

>> "Firing Line with Margaret Hoover" is made possible in part by... Robert Grainieri, Vanessa and Henry Cornell, The Fairweather Foundation The Tepper Foundation, Peter and Mary Kalikow The Beth and Ravenel Curry Foundation Pritzker Military Foundation, Cliff and Laurel Asness And by the following... (upbeat music) ( outro music ) You're watching PBS.

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