Mark Cuban calls out 3M for allowing distributors to jack up prices for critical N95 respiratory masks
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Dallas Mavericks owner Mark Cuban accused 3M of failing to keep prices of its face masks low during a time when they are critical to combatting the coronavirus in the country.
On March 21, the billionaire took to Twitter to accuse 3M of allowing its distributors to raise the prices of the masks to turn a profit.
In an interview with Bloomberg, Cuban admonished the price gouging of N95 respirator masks, calling the act "wrong" and "criminal."
3M has said the company cannot control the prices that distributors charge for 3M products.
Dallas Mavericks owner Mark Cuban called out the manufacturing giant 3M for failing to keep the prices of faces masks low and to get the critical protective gear to health workers on the frontlines of battling the coronavirus.
"I'm excited that 3M has increased capacity. But supply hasn't been matched with demand," the billionaire told Bloomberg News. "Why is 3M not telling distributors, pick up the phone, sell your inventory to the hospitals, or will never let you buy more product?"
Since the novel coronavirus has swept the country, the billionaire has pledged his money and efforts towards helping get health workers the personal protective equipment they need — including the coveted N95 masks that have been in short supply. Prices for the respiratory masks have soared with state governments, hospitals, and the general public scrambling to purchase the protective gear.
On March 20, 3M Chairman and CEO Mike Roman announced it would double its global production of N95 respiratory to a rate of more than 1.1 billion per year after "see[ing] the pleas from our heroic doctors, nurses and first responders for the respirators."
Despite earning the praise of President Donald Trump for its joining efforts to battle the novel virus, Cuban claimed the manufacturing company wasn't being honest about what it was doing with the masks after production.
—Mark Cuban (@mcuban) March 21, 2020
"3M lists all its distributors online, the ones buying and selling these things, and these distributors are making as much money as they possibly can," Cuban told Bloomberg News, adding that the resellers don't have to sell the masks to hospitals. "It's wrong, it's criminal."
Cuban explained that, until recently, 3M had been selling the masks exclusively to distributors instead of sending these masks directly healthcare providers. Cuban accused 3M of sitting on the sidelines while their distributors increased prices.
"It would have been very easy for them to say very strongly, 'If you don't sell if you don't take the inventory we're providing you and sell directly to hospitals and healthcare providers that need the masks, when your contract comes up, we're going to end that contract,'" Cuban told Fox News. "But that's not what they did. And I have a huge problem with that. "
Cuban claimed he first discovered 3M's oversight when he began receiving emails from 3M's distributors offering to sell him N95 masks at "premium prices."
Reuters/Nicholas Pfosi
"I have emails saying, 'I have a 100,000 masks per sale at $8 per piece.' I would ask if these were 3M masks, N95s, and if they could prove it. I literally have been offered billions of masks at premium prices from $4 to $8, million-dollar minimum orders, who knows what's real."
Cuban claimed that 3M's distributors have been selling the N95 masks to resellers in black markets who are jacking up the prices even higher than the distributors did. "It's operating like an illegal drug market, not a legitimate market," Cuban told Bloomberg News. "I get wanting to make millions of dollars, but people are dying."
Cuban said he has spoke with the federal government about stopping the "middlemen" who have allowed the masks to jack up prices of the N95 masks. Although he told Bloomberg News that he also reached out to the 3M CEO himself, he maintained on Fox News that Roman could have stepped in and stopped the price gouging much sooner.
"This could have stopped a long time ago if the CEO of 3M's said we only want you to sell it to health care providers," Cuban told Fox News.
3M did not immediately respond to Business Insider's request for comment. But a representative told Bloomberg News that the company cannot control the prices dealers charge for 3M products. The manufacturing giant also released a letter from Roman to Attorney General William offering its support to curb "pandemic profiteers."
"On behalf of 3M and our 96,000 employees worldwide, I would like to offer our support as you protect the public from counterfeiting and price-gouging with respect to critical medical devices, including the respirators and masks that are critical to our country's medical personnel," Roman wrote.
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