In a typical supply chain for counterfeit medicines, the illicit product is manufactured in China and shipped to Hong Kong before being transferred to a warehouse in Dubai for storage. It is then shipped to the Bahamas, where it is repackaged at a fulfillment center before being shipped to the United Kingdom to give the appearance that the medicine originated there. Eventually, it is sold through an online pharmacy based in Canada.
The global nature of the problem and the public-health risks associated with counterfeit and substandard pharmaceuticals prompted experts at a recent panel discussion in Washington to call for increased international cooperation to combat the illegal trade.
Panelists at the American Enterprise Institute (AEI) event included international representatives from both the public and private sectors. While acknowledging the lack of hard data, the experts shared the view that the problem is growing.
“It’s a bit like looking at any illegal market,” said Roger Bate, an AEI fellow and author of Making a Killing: The Deadly Implications of the Counterfeit Drug Trade. “It’s very difficult to know exactly the numbers.”
Patrick Ford, senior director of global security for pharmaceutical giant Pfizer Inc., offered some anecdotal evidence of the increase. Approximately 11.1 million tablets, capsules, and vials of counterfeit Pfizer products were seized in 42 countries last year, nearly a 29 percent increase over the year prior, according to Pfizer.
The counterfeit drugs themselves have become more dangerous as well. “Twenty years ago counterfeit medicines were essentially placebos,” said Jeffrey Gren, director of the office of health and consumer goods at the U.S. Department of Commerce. Today, however, they are more likely to have active product ingredients (APIs), he said.
Gren blames globalization for the increase in the size and nature of the problem, because it has created increasingly sophisticated criminals and made it easy for them to access and incorporate a ready supply of APIs.
The World Health Organization (WHO) estimates state that less than 1 percent of the drug supply is counterfeit in countries with strong regulatory oversight, as is the case with the United States and the United Kingdom. But where the regulatory structure is lax, counterfeits may be much higher. They are estimated to be as much as 35 percent of the total market in Lebanon and 30 percent in Kenya. WHO also estimates that 20 percent of medicines in India are counterfeit.
Some panelists, including Bate and Ilisa Bernstein, director of pharmacy affairs at the U.S. Food and Drug Administration, expressed skepticism about WHO’s estimates, however, calling them high.
“Four billion prescriptions were written in the United States last year,” said Bernstein. “One percent is 40 million. I highly, highly, highly doubt that 40 million prescriptions were filled in the United States with counterfeits.”
As for WHO’s estimate for India, Bate said that he is more inclined to believe the statistics compiled by the Indian government, which found that 0.4 percent of drugs in the country’s market are counterfeit and 8 percent are substandard. Substandard drugs are made by manufacturers, not criminals, but they are low quality due to old or insufficient ingredients, an incorrect ratio of ingredients, or wrong ingredients altogether.
Adding to the law enforcement challenge of addressing the problem is the fact that there is not a universally agreed-to definition for what constitutes counterfeit medicines, making the regulation and interdiction of such products difficult or in many cases impossible.
WHO currently defines a counterfeit as “a drug that has been deliberately and fraudulently mislabeled with respect to identity and/or source. Counterfeiting can apply to both branded and generic products, and counterfeit products may include products with the correct ingredients or with the wrong ingredients, without active ingredients, with insufficient active ingredients, or with fake packaging.”
Gren said the phrase “deliberately and fraudulently” is problematic, because the word “deliberate” requires legal proof. Early this year, WHO’s International Medical Products Anti-Counterfeiting Taskforce (IMPACT), a global coalition of stakeholders from the public and private sectors, proposed a revised definition that said a counterfeit is a product with a “false representation about its identity, history or source.” The new definition was rejected by developing countries led by India and Brazil, who fear that many drugs they consider “generic” will be deemed counterfeit if that definition is adopted.
Another issue is how to monitor for problems and enforce the laws. Gren recommended establishing a single point of contact in each country to facilitate the exchange of information and improving training at labs to facilitate the detection of counterfeit medicines. He also called for strengthening legal frameworks to make it easier to arrest and prosecute counterfeiters.
“Many countries have a laissez-faire attitude that once it leaves their borders, it’s no longer their responsibility,” Gren said. “That attitude needs to change.”
CORRECTION: In the original print and online version of this article, the number of tablets, capsules, and vials of counterfeit Pfizer products seized in 42 countries last year was 1.1 million. It is actually 11.1 million. The text has been corrected to reflect this.