The current state of Cuban's Houston-based manufacturing facility.

Mark Cuban's new cost-plus-15% gener­ic drug com­pa­ny is re­al­ly a com­pound­ing phar­ma­cy

Shark Tank’s Mark Cuban made a splash last week in the world of drug pric­ing, pledg­ing to cut out cost­ly PBMs and de­liv­er on a very sim­ple plan with his new phar­ma­cy, and some huge cost sav­ings for con­sumers.

Mark Cuban

The com­pa­ny, known as Mark Cuban Cost Plus Drug Com­pa­ny, pledges to on­ly charge a 15% mark-up for its gener­ic drugs, of­fer­ing al­ter­na­tives to a mar­ket of­ten prone to short­ages, and ex­pen­sive gener­ic drugs (think Mar­tin Shkre­li) due to lack of com­pe­ti­tion.

But while the com­pa­ny la­bels it­self a drug com­pa­ny, and pledges to get in­to gener­ic drug man­u­fac­tur­ing of its own in a Dal­las-based cGMP fa­cil­i­ty, the com­pa­ny is re­al­ly plan­ning to op­er­ate as a com­pound­ing phar­ma­cy.

Alex Osh­myan­sky

“At launch, we are plan­ning as func­tion­ing pri­mar­i­ly as a 503(b) com­pound­ing phar­ma­cy specif­i­cal­ly tar­get­ing drugs on the FDA short­age list,” CEO Alex Osh­myan­sky told End­points News via email. “That will al­low us to be more ag­ile and ad­dress drug short­ages as they arise.”

Be­com­ing a 503(b) com­pound­ing phar­ma­cy, al­so known as an out­sourc­ing fa­cil­i­ty, means the firm will be less reg­u­lat­ed than a typ­i­cal gener­ic drug com­pa­ny, but Cuban’s com­pa­ny will need to reg­is­ter with the FDA, be in­spect­ed by the FDA, and ad­here to spe­cif­ic man­u­fac­tur­ing re­quire­ments.

“We ful­ly in­tend to reg­is­ter as an out­sourc­ing fa­cil­i­ty with the FDA, though, when we are far enough along that we are el­i­gi­ble,” Osh­myan­sky said.

For now, the hun­dreds of drugs avail­able for pur­chase via the com­pa­ny’s web­site are all sourced from oth­er gener­ic man­u­fac­tur­ers.

The on­ly gener­ic drug cur­rent­ly list­ed in the FDA’s Na­tion­al Drug Code Di­rec­to­ry with Cuban’s com­pa­ny as the la­bel­er is for a gener­ic ver­sion of the an­ti-worm drug al­ben­da­zole.

“The oth­er prod­ucts will be list­ed once we are far enough along that we can be grant­ed ND­Cs,” Osh­myan­sky said.

The dis­tinc­tion be­tween op­er­at­ing as a gener­ic drug com­pa­ny and as a com­pound­ing phar­ma­cy means Cuban’s com­pa­ny like­ly won’t be sub­mit­ting its own gener­ic drug ap­pli­ca­tions to the FDA for new gener­ic prod­ucts, in­stead of pig­gy­back­ing off oth­er gener­ic drug sub­mis­sions, at least to start.

Oth­er play­ers in this field have sim­i­lar­ly pledged to crack down on drug short­ages in the US, in­clud­ing Rich­mond-based Phlow, which has vowed to end es­sen­tial med­i­cines short­ages in the US, and Utah-based non­prof­it Civi­ca Rx, which is man­u­fac­tur­ing ster­ile in­jecta­bles in short­age for hos­pi­tal clients on a cost-plus ba­sis, as well as tar­get­ing high­er-priced gener­ics via an­oth­er ini­tia­tive, where it plans to sub­mit its own AN­DAs in part­ner­ship with health plans.

But the cost com­po­nent that Cuban and Civi­ca are tar­get­ing re­mains cru­cial.

Al­lan Coukell

Al­lan Coukell, Civi­ca VP of pol­i­cy, told End­points, “For many prod­ucts, the gener­ic in­dus­try does a fan­tas­tic job of de­liv­er­ing low-cost drugs to pa­tients but there are some prod­ucts where costs re­main high so hav­ing some­one fo­cused on de­liv­er­ing those in a cost-plus mod­el is still nov­el.”

In ad­di­tion to the Cuban-backed Dal­las man­u­fac­tur­ing plant, which Osh­myan­sky said “is about half-way fin­ished with con­struc­tion,” Cuban is al­so plan­ning to run his own PBM, as well as a cash-on­ly phar­ma­cy, where con­sumers can buy more of these cost-plus-15% drugs li­censed via the on­line phar­ma­cy Truepill.

But more is com­ing, and Osh­myan­sky said the com­pa­ny has plans for a bi­o­log­ics li­cense ap­pli­ca­tion too, which will like­ly take more time to bring to mar­ket than a gener­ic drug.

“At the mo­ment, we are ac­tu­al­ly tak­ing a BLA through the FDA ap­proval process for a prod­uct we in­tend to make at the fa­cil­i­ty. We are not dis­clos­ing what the prod­uct is yet, though,” Osh­myan­sky said, not­ing that the com­pa­ny has every in­ten­tion of com­ply­ing with FDA in­spec­tions.

“Struc­tur­al steel is up now, and we are be­gin­ning to put up the walls and pip­ing next week. So noth­ing re­al­ly for the FDA to in­spect at the mo­ment, but cer­tain­ly plan to have it in­spect­ed as soon as is ap­pro­pri­ate,” he added.

Ar­ti­cle up­dat­ed to note the com­pound­ing fa­cil­i­ty is be­ing built in Dal­las, not Hous­ton.

Has the mo­ment fi­nal­ly ar­rived for val­ue-based health­care?

RBC Capital Markets’ Healthcare Technology Analyst, Sean Dodge, spotlights a new breed of tech-enabled providers who are rapidly transforming the way clinicians deliver healthcare, and explores the key question: can this accelerating revolution overturn the US healthcare system?

Key points

Tech-enabled healthcare providers are poised to help the US transition to value, not volume, as the basis for reward.
The move to value-based care has policy momentum, but is risky and complex for clinicians.
Outsourced tech specialists are emerging to provide the required expertise, while healthcare and tech are also converging through M&A.
Value-based care remains in its early stages, but the transition is accelerating and represents a huge addressable market.

Alaa Halawaa, executive director at Mubadala’s US venture group

The ven­ture crew at Mubadala are up­ping their biotech cre­ation game, tak­ing care­ful aim at a new fron­tier in drug de­vel­op­ment

It started with a cup of coffee and a slow burning desire to go early and long in the biotech creation business.

Wrapping up a 15-year discovery stint at Genentech back in the summer of 2021, Rami Hannoush was treated to a caffeine-fueled review of the latest work UCSF’s Jim Wells had been doing on protein degradation — one of the hottest fields in drug development.

“Jim and I have known each other for the past 15 years through Genentech collaborations. We met over coffee, and he was telling me about this concept of the company that he was thinking of,” says Hannoush. “And I got immediately intrigued by it because I knew that this could open up a big space in terms of adding a new modality in drug discovery that is desperately needed in pharma.”

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Rohan Palekar, 89bio CEO

89bio’s PhII da­ta add to quick suc­ces­sion of NASH read­outs as field seeks turn­around

89bio said its drug was better than placebo at lessening fibrosis without worsening nonalcoholic steatohepatitis, or NASH, in two of three dose groups.

The San Francisco biotech said it thinks the Phase IIb data pave the way for a potential Phase III, following in the footsteps of another biotech in its drug class, Akero Therapeutics. To fund a late-stage study, CEO Rohan Palekar told Endpoints News 89bio “would need to raise additional capital,” with the company having about $188 million at the end of last year.

Flare Therapeutics biochemists Yong Li (L) and Valerie Vivat

A $123M Flare will get Third Rock on­col­o­gy biotech in­to the clin­ic this year

Flare Therapeutics will start its first human trial this year with an investigational urothelial cancer drug after pulling together a $123 million Series B from Big Pharmas, VCs and its incubator, Third Rock Ventures.

Launched in 2021 on the idea that a biotech could finally succeed at drugging the much-sought-after but stubborn transcription factor, Flare Therapeutics said Wednesday it is now primed for the clinic after closing its large financing haul earlier this year. The raise is a relatively stark figure in a tough startup financing environment but further buoys the upbeat signals coming out of other Third Rock biotechs in recent weeks, including the $200 million CARGO Therapeutics and $100 million Rapport Therapeutics rounds.

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Francesco Marincola, newly-appointed Sonata Therapeutics CSO

Kite's head of re­search leaves for Flag­ship start­up Sonata

Another leader is departing Kite Pharma, and will to spend the “last part” of his career exploring how cancer evades the immune system.

Kite’s senior VP and global head of cell therapy research Francesco Marincola left the Gilead CAR-T unit last week for Sonata Therapeutics. Flagship last May unveiled the startup, which was pieced together from two fledgling biotechs Inzen and Cygnal Therapeutics. As CSO, Marincola will lead Sonata’s push to reprogram cancer cells to make them more immunogenic.

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FDA in­di­cates will­ing­ness to ap­prove Bio­gen ALS drug de­spite failed PhI­II study

Ahead of Wednesday’s advisory committee hearing to discuss Biogen’s ALS drug tofersen, the FDA appeared open to approving the drug, newly released briefing documents show.

Citing the need for flexibility in a devastating disease like ALS, regulators signaled a willingness to consider greenlighting tofersen based on its effect on a certain protein associated with ALS despite a failed pivotal trial. The documents come after regulatory flexibility was part of the same rationale the agency expressed when approving an ALS drug last September from Amylyx Pharmaceuticals, indicating the FDA’s openness to approving new treatments for the disease.

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NIH re­jects an­oth­er at­tempt to 'march-in' on Astel­las' prostate can­cer drug over ex­ces­sive price

The National Institutes of Health has again declined to use so-called “march-in” rights to lower the price of Astellas and Pfizer’s prostate cancer drug Xtandi despite being invented at UCLA with grants from the US Army and NIH.

“Given the remaining patent life and the lengthy administrative process involved for a march-in proceeding, NIH does not believe that use of the march-in authority would be an effective means of lowering the price of the drug,” NIH told prostate cancer patients Robert Sachs and Clare Love, in a letter shared with Endpoints News. The institutes’ analyses found Xtandi “to be widely available to the public,” an indication that there was not a pressing need for the US to act.

No­vo Nordisk re­mains un­der UK scruti­ny as MHRA con­ducts its own re­view in 'in­cred­i­bly rare' case

The UK’s Medicines and Healthcare products Regulatory Agency is now reviewing Novo Nordisk’s marketing violation that resulted in its loss of UK trade group membership last week. Novo Nordisk was suspended on Thursday from the Association of the British Pharmaceutical Industry (ABPI) for two years after an investigation by its regulatory arm found the pharma broke its conduct rules.

MHRA said on Tuesday that its review of the Prescription Medicines Code of Practice Authority (PMCPA) investigation is standard practice. An MHRA spokesperson emphasized in an email to Endpoints News that the situation with Novo Nordisk is “incredibly rare” while also noting ABPI took “swift and proportionate action.”

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Mar­ket­ingRx roundup: What could a US Tik­Tok ban mean for phar­ma? Pfiz­er, Lil­ly lead phar­ma March Mad­ness ad­ver­tis­ers

Just as pharma marketers finally make moves into TikTok, the threat of a US ban on the social media channel is now looming. Already banned on federal employee phones by an initial Congressional act, more bills and maybe bans are on the way. With rare bipartisan agreement, lawmakers have introduced legislation that would give the US president the power to ban TikTok (although not mentioned by name) and other foreign-owned technology platforms that represent a security threat to the US.

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