Drug efficacy does not always increase sigmoidally with concentration, which has puzzled the community for decades. Unlike standard sigmoidal curves, bell-shaped concentration-response curves suggest more complex biological effects, such as multiple-binding sites or multiple targets. Here, we investigate a physical property-based mechanism for bell-shaped curves. Beginning with the observation that some drugs form colloidal aggregates at relevant concentrations, we determined concentration-response curves for three aggregating anticancer drugs, formulated both as colloids and as free monomer. Colloidal formulations exhibited bell-shaped curves, losing activity at higher concentrations, while monomeric formulations gave typical sigmoidal curves, sustaining a plateau of maximum activity. Inverting the question, we next asked if molecules with bell-shaped curves, reported in the literature, form colloidal aggregates at relevant concentrations. We selected 12 molecules reported to have bell-shaped concentration-response curves and found that five of these formed colloids. To understand the mechanism behind the loss of activity at concentrations where colloids are present, we investigated the diffusion of colloid-forming dye Evans blue into cells. We found that colloidal species are excluded from cells, which may explain the mechanism behind toxicological screens that use Evans blue, Trypan blue, and related dyes.