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In A Nutshell
- Most of the time, health insurance lowers what patients pay, but not always.
- A 2025 study found two neurologic drugs were actually cheaper to buy without insurance.
- Insurance plans covered most costs for patients, yet inflated total spending by more than 400% overall.
- Direct-to-consumer pharmacies like Mark Cuban’s offer transparent prices that can rival or beat insured rates.
- For uninsured patients, checking open-price pharmacies could mean big savings on select medications.
COLUMBUS, Ohio — Having health insurance is supposed to make medications affordable. But for some patients taking neurologic drugs, insurance creates a counterintuitive situation: they might pay less by skipping their coverage altogether.
A new study published in JAMA Network Open reveals that two widely prescribed neurologic medications cost patients less when purchased directly without insurance than through their commercial insurance plans. The finding challenges a core assumption about how prescription coverage works and raises questions about whether the complexity of the insurance system sometimes defeats its own purpose.
Researchers at The Ohio State University compared costs for 33 neurologic medications between traditional commercial insurance plans and the Mark Cuban Cost Plus Drug Company, a direct-to-consumer pharmacy that sells directly to patients without involving insurers. Among all medications studied, only teriflunomide and droxidopa (drugs prescribed for multiple sclerosis and low blood pressure conditions respectively) came out cheaper for patients buying directly.
Patients with commercial insurance paid an average of $286 out-of-pocket annually for teriflunomide. Through the direct-to-consumer pharmacy, the same medication cost $205 total, a 40% reduction. For droxidopa, insured patients paid about $238 out-of-pocket, while the direct-to-consumer option was about 18% lower in out-of-pocket cost. Both medications generated far higher total system costs (the combined amount paid by insurers and patients) when processed through insurance.
These two medications bucked a broader trend. Across all 33 drugs examined, the direct-to-consumer pharmacy charged about 75% more out-of-pocket on average than what patients with commercial insurance paid. Insurance worked as intended for most people, absorbing costs that would otherwise fall directly on patients.
The Hidden Markup in Prescription Drug Costs
While insurance lowered costs for patients, it inflated what the system paid overall. Total costs through commercial insurance averaged 413% higher than direct-to-consumer pharmacy prices.
For teriflunomide, insurance companies paid a total of $11,739 annually per patient while covering most of that $286 out-of-pocket cost. The medication that costs $205 through a direct-to-consumer model resulted in nearly $12,000 in total billed costs when filtered through the insurance system, a 5,622% markup.
Droxidopa showed similar inflation. Total insurance costs reached $11,618 annually, compared to $238 at the direct-to-consumer pharmacy, a 4,777% difference. In both cases, patients paid roughly what an uninsured person would pay buying directly, but the insurance machinery generated thousands of dollars in additional costs absorbed by the broader system.
The research team analyzed prescription data from 2012 to 2021, examining patients diagnosed with 14 neurologic conditions, including Alzheimer’s disease, Parkinson’s disease, epilepsy, amyotrophic lateral sclerosis, and multiple sclerosis. They used statistical models to project 2024 costs from this historical data, accounting for factors like generic drug introduction timing and market competition.
Direct-to-consumer pricing came from the Mark Cuban Cost Plus Drug Company website as of December 10, 2024, including medication costs plus manufacturing, markup, pharmacy labor, and shipping fees.
Health Insurance Still Protects Most Patients From High Drug Prices
For patients, the practical takeaway isn’t straightforward. While two medications proved cheaper without insurance, the other 31 studied showed why coverage remains necessary. Glatiramer acetate, another MS drug, cost $24,186 annually through the direct-to-consumer pharmacy but only $203 out-of-pocket through insurance. For anyone taking this medication, insurance makes the difference between manageable treatment and financial ruin.
The direct-to-consumer pharmacy carried only 33 of the 79 neurologic medications the researchers initially examined, a 42% availability rate. Missing drugs included lacosamide, gabapentin, pregabalin, and various antipsychotics, limiting its usefulness as a complete alternative to traditional pharmacies.
Among medications available at both sources, 55% had lower total annual costs through the direct-to-consumer model. Three MS drugs (teriflunomide, fingolimod, and dimethyl fumarate) showed possible aggregate savings of at least $11 million each if all prescriptions were filled directly rather than through insurance.
The researchers examined medications spanning epilepsy (lamotrigine, levetiracetam, valproate), Parkinson disease (carbidopa-levodopa, pramipexole, ropinirole), and dementia (donepezil, memantine, galantamine), among other neurologic conditions. Sample sizes ranged from fewer than 100 patients for some drugs to over 12,000 for others.
Direct-to-Consumer Pharmacies May Benefit Uninsured Patients
For the roughly 27 million Americans without health insurance, direct-to-consumer pharmacies offer access to some medications at prices comparable to or lower than what insured patients pay out-of-pocket.
An uninsured patient buying teriflunomide directly pays $205 annually, less than the $286 an insured patient contributes through copays, coinsurance, and deductibles. The catch is that most other medications remain more expensive without insurance coverage, and the limited formulary means patients often can’t obtain all their prescriptions from one source.
When patients fill prescriptions at different pharmacies, important safety checks can be missed. Drug interaction screenings and medication adherence monitoring become harder when a patient’s complete medication list isn’t visible in one place.
At the aggregate level, if every commercial prescription studied were filled through the direct-to-consumer pharmacy, patient out-of-pocket costs would increase by $82 million while total system expenditures would increase by about $9 million.
How Pharmacy Middlemen Drive Up Medication Costs
The pharmaceutical supply chain involves drug manufacturers, insurance companies, pharmacy benefit managers, and retail pharmacies. Each player negotiates prices and takes a cut, creating a complex web of transactions between when a drug leaves the factory and when a patient picks it up.
Direct-to-consumer models eliminate several intermediaries, which may explain lower total costs. The Mark Cuban Cost Plus Drug Company discloses its pricing structure: medication cost plus a 15% markup, $3 pharmacy labor fee, and $5 shipping. This transparency contrasts with the opaque negotiations typical of commercial pharmaceutical transactions.
MS medications have remained among the highest-cost, high-prevalence neurologic drugs for over 20 years, with total costs continuing to rise despite the introduction of generic alternatives. The direct-to-consumer pharmacy carries four MS medications, three showing reduced total costs compared to insurance plans.
“Our research has shown that the costs of medications just continue to rise through insurance plans, and it’s really important to find ways for patients to access medicines,” said study author Dr. Amanda Gusovsky Chevalier, an assistant professor at Ohio State’s College of Medicine, in a statement. “I think this adds to a larger body of evidence showing that these direct-to-consumer pharmacies have the potential to disrupt the market in some significant way in the future. It’s important for people to know that online pharmacies like this are available.”
For patients facing high copays or lacking prescription coverage, checking direct-to-consumer pharmacy prices makes practical sense. Neurologists should be aware these alternatives exist, particularly for the two medications where buying directly undercuts insured out-of-pocket costs. In rare cases, the most expensive part of getting medication isn’t the drug itself but the system designed to make it affordable.
Who Really Saves With Mark Cuban’s Cost Plus Drugs?
Mark Cuban’s Cost Plus Drug Company launched in 2022 with a straightforward promise: sell generic medications at transparent prices, cutting out the traditional pharmaceutical middlemen. The company lists its pricing formula openly on every product page: medication cost plus a 15% markup, a $3 pharmacy labor fee, and $5 shipping.
For many Americans, particularly those without insurance, this model offers a lifeline. An uninsured patient can buy teriflunomide, a multiple sclerosis medication, for $205 annually. That’s less than the $286 a year that insured patients typically pay through copays and deductibles. The direct-to-consumer model essentially gives uninsured patients access to generic drugs at prices comparable to what insured patients pay out-of-pocket.
But for the roughly 92% of Americans who do have health insurance, the value proposition becomes murkier. This study found that only 2 out of 33 neurologic medications were cheaper at the direct-to-consumer pharmacy than what insured patients pay. For the other 31 medications, insurance coverage still provided better out-of-pocket prices.
The dramatic example: glatiramer acetate, another MS drug, costs $24,186 annually through Mark Cuban’s pharmacy. An insured patient pays just $203 out-of-pocket for the same medication. Insurance absorbs the remaining $6,556 in total costs, making it irreplaceable for anyone taking this particular drug.
Where the model shines:
- Uninsured patients needing generic medications
- Insured patients with high deductibles who haven’t met them yet
- Patients whose insurance doesn’t cover a specific medication
- Those taking one of the few drugs actually cheaper than insurance copays
Where traditional insurance still wins:
- High-cost medications with expensive direct-to-consumer prices
- Patients with good insurance coverage and low copays
- Anyone needing brand-name drugs (the direct-to-consumer pharmacy focuses on generics)
The pharmacy’s limited formulary presents another challenge. With only 42% of commonly prescribed neurologic medications available, patients can’t fully replace their regular pharmacy. Splitting prescriptions between multiple sources creates fragmentation in care—pharmacists can’t screen for drug interactions if they don’t see a patient’s complete medication list.
The broader implications extend beyond individual patients. While the direct-to-consumer model charges patients more out-of-pocket on average (75% higher than insurance copays), it costs the healthcare system far less overall (413% lower in total expenses). This gap reveals how much the current pharmaceutical supply chain inflates prices through negotiations between drug manufacturers, insurers, pharmacy benefit managers, and retail pharmacies.
Whether direct-to-consumer pharmacies can force traditional players to lower prices remains uncertain. For now, they serve as a valuable alternative for specific situations—particularly for the uninsured—rather than a universal solution. Patients considering this option should compare direct-to-consumer prices against their insurance copays before making the switch, and neurologists should be aware these alternatives exist when counseling patients about medication costs.
The Mark Cuban Cost Plus Drug Company continues adding medications to its formulary, though the pace of expansion and whether it can offer a comprehensive alternative to traditional pharmacies remains to be seen.
Disclaimer: This article is for general information only and does not constitute medical, financial, or insurance advice. Patients should consult their healthcare providers or pharmacists before changing how they obtain medications.
Paper Summary
Methodology
Researchers conducted a cross-sectional study comparing neurologic medication costs between the Mark Cuban Cost Plus Drug Company and commercial insurance plans. They analyzed data from the Merative MarketScan commercial and Medicare supplemental databases covering 2012 to 2021, examining patients who had outpatient neurologist visits with diagnoses for 14 neurologic conditions and received relevant medications within 12 months. The team built four linear regression models to estimate 2024 costs, accounting for factors including time trends, generic drug introduction timing, number of generic manufacturers, and number of therapies in each drug class. Direct-to-consumer pharmacy prices were obtained from the company website on December 10, 2024, with annual costs calculated by multiplying three-month supplies by four and adding associated fees. The study included 33 medications available through both channels, representing 42% of the 79 neurologic medications initially considered.
Results
Among the 33 medications studied, only two (teriflunomide with a 40% reduction and droxidopa with an 18% reduction) offered lower out-of-pocket costs through the direct-to-consumer pharmacy compared to commercial insurance plans. Overall, the direct-to-consumer pharmacy demonstrated 75% higher out-of-pocket costs but 413% lower total costs than commercial insurance. For total costs, 18 of 33 medications (55%) favored the direct-to-consumer pharmacy, with teriflunomide showing a 5,622% reduction, droxidopa a 4,777% reduction, and dimethyl fumarate a 1,894% reduction. In generic-only comparisons, no medications had lower out-of-pocket costs through the direct-to-consumer pharmacy. At the aggregate level, if all commercial prescriptions were filled through the direct-to-consumer pharmacy, out-of-pocket expenditures would increase by $82 million while total expenditures would increase by about $9 million. Three MS medications (teriflunomide, fingolimod, and dimethyl fumarate) each showed aggregate total cost savings exceeding $11 million.
Limitations
The study has several limitations. Commercial insurance costs came only from neurologist-prescribed medications, which may differ from prescriptions written by other practitioner types. The researchers used statistical models to estimate 2024 costs from data through 2021, which could be inaccurate if insurance costs changed in unpredictable ways. The direct-to-consumer pharmacy carried only 42% of the neurologic medications examined, limiting comprehensiveness. The database contained no information about manufacturer discounts or rebates, so these were not accounted for in the analysis. The study period spanned the COVID-19 pandemic, though 2024 estimates incorporated all historical pre-pandemic data. Sample sizes varied considerably, with some medications having fewer than 100 patients while others exceeded 12,000 patients.
Funding and Disclosures
The study received no specific funding. Dr. Reynolds reported receiving personal fees from the American Diabetes Association, Ohio State University, and Michigan State University, plus grants from the National Institutes of Health and Breakthrough T1D outside the submitted work. Dr. Callaghan reported receiving grants from the National Institute on Aging and American Academy of Neurology and providing medical-legal consultation to Dynamed and editorial support to the American Academy of Neurology outside the submitted work. No other conflicts of interest were disclosed.
Publication Details
Gusovsky Chevalier AV, Lin CC, Kerber K, Reynolds EL, Callaghan BC, Burke JF. Neurologic Medication Costs in a Direct-to-Consumer Pharmacy vs Commercial Insurance Plans. JAMA Network Open. 2025;8(8):e2527476. doi:10.1001/jamanetworkopen.2025.27476
