30 January 2015Americas

The bitter pill of fake medicine

In 2012 in Pakistan, more than 100 people suffering from hypertensive heart disease lost their lives after being given the wrong drugs. Instead of receiving the correct medicine to treat their illness, the authorities unknowingly gave them a counterfeit anti-hypertensive medicine, which instead weakened their immune systems.

It is just one example of the many tragedies that result from the sale and distribution of counterfeit drugs. Fake medicines purporting to treat certain diseases may be intended to tackle another disease, may have a low dosage of the active ingredient needed to treat the problem, or may contain harmful products. Sometimes it takes months to realise the patient has taken the wrong drug, and by that point it is often too late.

Numerous non-profit international bodies such as the World Customs Organization (WCO), the World Health Organization (WHO) and Interpol, as well as many others, are on the front line in the battle against the sale and distribution of counterfeit drugs.

But the already enormous challenge is getting even harder. In its most recent Illicit Trade Report (published last June), where the number of counterfeit products seized by customs authorities internationally is documented, the WCO notes that in 2013 “more than half of the reported intercepts were illicit pharmaceutical products”, a rise on 2012.

Wendy Goldstein, partner at law firm Cooley, says this increase is caused by the trade in counterfeit drugs being “more global than ever”, because medicine is “now available through the worldwide internet” and that online sales of medicine have had an “enormous impact on the problem of counterfeit drugs”.

“The distribution channel allows purchasers access to products without any understanding of product origin and/or pedigree. Sellers do not always require applicable laws and regulations regarding prescriptions. The oversight of the seller of the products via this network has become tremendously difficult,” she adds.

“The global regulatory and enforcement resources required to provide sufficient oversight that is controlled, consistent and coordinated over the distribution channel, are tremendous.

"Counterfeiters operating websites are wise about the methods used to take them down and halt the distribution of drugs."

“There has been some enforcement against websites that enable the sale of products under inappropriate conditions as a means to curtail some of the counterfeit products from entering the marketplace,” she adds.

Tackling this problem has proved difficult. Alastair Shaw, of counsel at law firm Hogan Lovells, explains that counterfeiters operating websites are wise about the methods used to take them down and halt the distribution of drugs.

“If your website gets taken down then you just open another one at a different domain name and on a different server. Consumers are able to purchase the drugs directly from the websites. And because drugs are very small and not large, bulky items, they can be shipped in packaging that makes them look like parcels from legitimate online retailers, which raises little suspicion,” he says.

Clarity needed

Finding solutions to this hidden trade is made more difficult by the lack of international understanding and varying definitions of what a counterfeit drug is. The WHO has identified this as a key problem in the battle against fake medicine, stating that it “not only makes information exchange between countries very difficult, but it also limits the ability to understand the true extent of the problem at a global level”.

The WHO describes a counterfeit medicine as one “which is deliberately and fraudulently mis-labelled with respect to identity and/or source”.

It adds: “Counterfeiting can apply to both branded and generic products and may include products with the correct ingredients or with the wrong ingredients, without active ingredients, with insufficient active ingredients or with fake packaging”.

Despite the lack of clarity elsewhere, the WCO has provided an analysis that gives a better picture of the international situation. Its most recent Illicit Trade Report says that “in 2013, China emerged again as the main departure country for counterfeit goods when analysing data in terms of number of cases, accounting for almost half of the total number of cases.

“India ranks first when it comes to the number of pieces of goods, as a result of large consignments of medicines, intercepted at import by countries in Africa and the Middle East in particular,” the report adds.

The WCO reports that 44% of all seizures were in mail centres, followed by airports and seaports. The report concludes that the number one country of destination for the majority of counterfeit medicine was the US, followed by Saudi Arabia and then a range of European countries.

Because the problem is global, Goldstein says, “there needs to be international cooperation among countries. A global treaty criminalising the manufacture and distribution of counterfeit products should be considered.”

In the absence of an international treaty on counterfeit drugs, or an accepted definition of them, there is a market situation which, according to Andrew Marshall, barrister at law firm Edmonds Marshall McMahon, is a ‘wild west’.

Marshall says the incentives are for people who “don’t care about humanity, but just about making money”.

National efforts

Some countries are taking incremental steps to address the trade of counterfeit drugs. In Russia, for instance, the government has proposed legislation that could mean those found guilty of distributing fake medicine could face up to ten years in prison. Fines for selling fake medicine could amount to 1 million roubles ($15,000); financial punishments for such crimes currently stand at 100,000 roubles.

In the EU, law makers introduced the False Medicine Directive in 2011 to address the problem of the counterfeit drug trade and its online distribution model.

Shaw assesses this move as positive. “The idea was to strengthen the security of the entire supply chain, so everybody is regulated to a certain extent, all the way back to the manufacturers,” he says.

“There are now much more rigorous balances and checks of the supply chain that cover online selling and buying drugs.”

Under the directive, pharma companies that have obtained a licence in the EU to sell medicine online have to display a logo that states it has been approved by an official body. The logo will provide a link to rules and regulations to which the pharma company has to abide.

Other changes in EU law will require pharma companies to print a barcode on each packet of medicine they sell, which will be recorded in a database at the point of distribution and at the point it is sold in the pharmacy. Also, substances manufactured outside the EU and imported into its borders will require written approval from the regulatory body in the nation where the drug is made.

Beyond legislation, there has also been international cooperation on enforcement action. The WCO has organised “simultaneous enforcement activities with multiple customs administrations” to combat the problem of fake drugs. One of its efforts in 2013, Operation Biyela, brought together 23 countries across Africa to tackle the problem.

Operation Biyela was divided into two phases. Phase one involved a three-day workshop organised by the WCO in the participating countries, with the organisation training local border officials using sophisticated techniques to find counterfeit drugs. The second phase was a ten-day operation in which WCO officials assisted the countries at their various seaports. They found just over one billion counterfeit products, with fake pharma goods accounting for more than half.

While it is impossible to report on the exact number of counterfeit products in circulation globally, these huge figures provide an insight into the scale of the problem. The WCO described Operation Biyela as a success, and it paves the way for further international cooperation to tackle the sale and distribution of counterfeit drugs.

Adopting the WHO’s definition internationally could be one step forward in the integration of all anti-counterfeiting measures. In practice, we can see the beginning of harmonisation in the enforcement programmes conducted by the WCO.

As the WCO’s Illicit Trade Report notes, counterfeiters are operating across multiple jurisdictions and using online distribution methods to gain access to new customers. In the False Medicine Directive, online distribution is addressed by requiring licensed wholesalers to display a logo stating that they are approved by EU regulatory bodies to sell medicine and provide a link to such regulations. This is a move towards transparency in the market of medicine sold and distributed online.

The more pharma companies across the world that are in dialogue with regulatory bodies and enforcement organisations, the less likely we are to see tragic situations like the one in Pakistan.

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