Men are paying highly inflated prices for erectile-dysfunction and hair-loss drugs sold on the internet by startups like Hims Inc. and Roman Health Medical, Bloomberg reports.

What's happening: The generic drugs are sold at a premium in exchange for cool packaging and the convenience of an online doctor visit to obtain the prescription.

  • For example, Roman sells a 20 mg dose of generic Viagra for $2, while Hims sells it for $3 a pill. Pharmacies buy the drug for about 15 cents a pill, and patients can find them at drugstores through online discount programs for as cheap as 41 cents a pill.

People who use the sites may not realize they could have gotten a better price elsewhere.

  • "Aside from the convenience and costs saved by not having to travel to the doctor or pharmacy, you gain access to a personalized consultation with a physician," Hims' CEO Andrew Dudum told Bloomberg.

What we're watching: The companies' success has drawn competition, which may end up driving down prices.

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