According to a new study, Medicare could save up to $ 3.6 billion in 2020 if it bought generic drugs at prices paid by the pharmaceutical company of billionaire entrepreneur Mark Cuban.
A study by researchers at Brigham and Women’s Hospital in Boston, published in the Annals of Internal Medicine, suggests inefficiencies in the way Medicare currently pays for generic drugs.
The Mark Cuban Cost Plus Drug Company, launched online earlier this year, aims to simplify the complex drug supply chain and offer savings to consumers. It offers commonly used generic drugs with a 15 percent markup, plus a $ 3 dosing fee and a $ 5 delivery fee. He does not accept insurance, which means that patients pay out of pocket.
This simplified model offers significant savings, the study found. The $ 3.6 billion savings amount to 37 percent of the $ 9.6 billion Medicare spent on the 89 drugs studied in the study. There were savings of 77 of these drugs and 12 without savings.
“Competition in generic drugs is a major source of savings on prescription drugs in the United States, but lower prices directly to the consumer underscore the inefficiencies of the existing pharmaceutical distribution and reimbursement system, which includes wholesalers, managers pharmacies, pharmacies, and insurers, ”the study said. “According to one estimate, this supply chain retains 64% of every dollar spent on generic drugs, compared to 25% of every dollar spent on branded drugs before discounts.
Cuban tweeted to President Biden and a number of congressional leaders in connection with the study, saying, “Let your people call my people and let’s get this over with.”
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Cuban’s efforts and research are focused on generic drugs, which are now generally cheaper and older drugs than branded drugs.
Congressional efforts to change the way Medicare pays for drugs are mostly focused on more expensive branded drugs. Democrats are pushing for a proposal to allow Medicare to negotiate lower prices for some of these drugs, a long-term goal for the party.
The study’s authors conclude that policy efforts to increase price transparency, increase competition and reduce pharmacy and distribution costs could help Cuban company’s overall savings for Medicare as a whole.
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