Introduction
Every day research is being done to find better medications to replace existing ones. Scientists and researchers around the globe are constantly working to make new drugs for illness never before treated. Consumers of these medications are helpless to the possibility of purchasing counterfeit drugs because of their countries’ regulations or lack thereof regarding counterfeit drug reporting and investigations.
Many consumers in developing countries purchase counterfeit medications from pharmacies or are given the medications from free clinics. Some pharmacies and clinics are infiltrated with counterfeit drugs, which either do not contain the correct amount of active ingredients or do not contain any active ingredients at all. In developed countries the incident of counterfeit medications being sold in pharmacies is extremely low, however, price conscious consumers who purchase medications over the internet are at a much higher risk of being sold counterfeit drugs without ever knowing.[i]
In this paper I will address the dangers of counterfeit drugs, why reporting of findings of counterfeit drugs and investigating counterfeit operations is so crucial and how pharmaceutical companies can help to address this issue through their intellectual property rights along with the help of governments around the globe.
I. What are Counterfeit Drugs?
Counterfeit drugs are those products sold in the marketplace which are not what they purport to be. The product may not meet the standards of the original drug, may not contain the proper amount of the active ingredients, or may not contain any active ingredients at all.[ii]
The World Health Organization (WHO) defines a counterfeit medication as “one which is deliberately and fraudulently mislabeled with respect to identity and/or source. Counterfeit products may include products with correct ingredients or wrong ingredients, without active ingredients, with insufficient ingredient or with fake packaging.”[iii]
The Anti-Trade Counterfeiting Agreement (ACTA), an agreement outlining standards for intellectual property protection, defines counterfeit trademark goods as:
“any goods, which are copies made without the consent of the right holder or person duly authorized by the right holder in the country of production and which are made directly or indirectly from an article where the making of that copy would have constituted an infringement of a copyright or a related right under the law of the country in which the procedures set forth in Chapter II are invoked;” [iv]
Counterfeit drugs are not to be confused with generic drugs. Generic drugs closely resemble the primary product and are to be used as a substitute for the product, not a cheaper replacement product not approved by physicians.
II. Dangers of Counterfeit Drugs
Pharmaceutical companies have patents on their products, which only allow them to manufacture their recipe of the patented medications. Many countries do not respect other countries’ intellectual property rights, specifically pharmaceutical patents on medications. Although patent protection is on the rise, “prior to 1995, there were more than 50 countries that did not provide any patent protection to the pharmaceuticals”[v] there are still multiple countries who do not recognize intellectual property rights.
Counterfeit manufacturers produce “knock-offs” of medications manufactured by large pharmaceutical companies and then sell them in the same market as the larger companies but for a cheaper price. The country where the medication is manufactured action’s against the manufacturer differ because countries protection of intellectual property rights vary around the world. The danger in this type of situation lies in the medications; many of them do not meet the standards set by individual countries or are not medications to treat the disease advertised by the company manufacturing the “knock-off”.[vi] The main method to stop the counterfeit operations is through pharmaceutical companies enforcing their IP rights through their patents.
The problem of counterfeit drugs is not a problem of the past. The counterfeit drug problem is rapidly growing because of the speed and ease for consumers to purchase medications online. Internet sales are a major method of sales for counterfeit manufacturers. In 1999, Americans bought $158 million in drugs over the internet.[vii] Many internet pharmacies will sell medications without prescriptions and the medications they sell are either not approved or counterfeit. [viii] It has been found that “more than 50% of drugs sold online have either been falsified or altered in some way.”[ix]
According to Keeping It Real, by Harris, Stevens and Morris, the major dangers of counterfeit drugs include, failure to provide effective treatment, direct harm and drug resistance.[x]
Providing effective treatment and direct harm seem to go hand in hand. People cannot be treated for their illnesses if they are not taking the proper amounts of active ingredients or not taking the proper medications at all. According to the World Health Organization, regarding counterfeit drugs, “16% have incorrect ingredients, 17% have incorrect amounts of ingredients, and 60% have no active ingredients.”[xi] If consumers are not taking the proper medications this causes them “direct harm” by worsening their condition and possibly causing death. U.S. News and World Report quotes the World Health Organization stating “more than 7 percent of the world’s pharmaceuticals are bogus, and in Columbia, up to 40 percent of medications are believed to be fake.”[xii] A spokesman for the FDA estimates “up to 15% of all sold drugs are fake, and in parts of Africa and Asia this figure exceeds 50%.” [xiii] This means startling numbers of people around the world are purchasing medications to help them with their illnesses and are not being treated by their medications.
At times medications have proven to contain different ingredients than the medications the consumer is purchasing causing them to get different side effects and at the same time not being properly treated for their disease. For many people not properly treating their diseases can be life threatening. Using counterfeit medications can cause additional problems to the consumer’s already present illness, can worsen their condition, can trick the consumer into thinking they are getting better when in reality they are not, and in the worst cases causes death.
Drug resistance is another serious danger with counterfeit drugs. When counterfeit drugs contain some active ingredients but not enough to be effective, the result is drug-resistant bacteria strains.[xiv] The number of deaths and drug resistance levels continue to rise due to consumption of counterfeit drugs, which is “creating a healthcare nightmare.”[xv] This causes the disease to be stronger and harder to treat. “In July 2008, 30 of the 100 AIDS patients…in the Democratic Republic of Congo had virus strains that resisted the standard medicines.”[xvi] Counterfeit medications are extremely dangerous because they can not only kill the person taking the medications, it can ultimately lead to the treatment of themselves and others to be harder and potentially kill others that never taken the counterfeit medications.
III. Who is Affected by Counterfeiting?
Although “counterfeiting is greatest in those regions where the regulations and legal oversight is weakest,” everyone should be concerned.[xvii] Counterfeit drugs are not just a problem for underdeveloped countries, but for both underdeveloped and developed countries alike.
Many people in developed countries feel protected by our country’s regulations but they should not be fooled. Although counterfeit drugs are much more prevalent in developing countries opposed to stronger developed countries, counterfeit drugs have posed significant threats to both types of nations. In 2005 Pfizer, a leading prescription company, recalled 120,000 packets of Lipitor in Britain and found that 60% of the returned packets were fakes.[xviii]
In the United States, in 1996 there were several dozen deaths attributed to a suspected counterfeit version of the antibiotic gentamicin sulfate. Two years later, the drug was distributed from an FDA approved manufacturer, the drug caused six patients to suffer toxic reactions because the drug contained incorrect ingredients. The FDA shut down the wholesaler located in New Jersey. It was found the company was importing counterfeit drugs from China and re-packaging them to look like they were FDA approved versions.[xix]
A TIMEHealth article quotes the WHO in stating that the counterfeit manufacturing industry makes around $75 billion per year.[xx] Counterfeit drug manufacturing will continue to be a problem until harsh measures are taken against those manufacturing the false drugs. The counterfeit drug industry is entirely too profitable and too easy to get away with to discourage the counterfeit manufacturers.
IV. Methods of Detection of Counterfeit Drugs
Many countries rely on the pharmaceutical companies to detect counterfeit medications. The burden of detection and reporting lies primarily with the pharmaceutical companies to find counterfeits of their medications, report the counterfeits to the proper authorities and to warn consumers regarding the infiltration of counterfeits. Due to the burden resting on their shoulders, pharmaceutical companies have taken steps to mark their medications so they can be identified against counterfeit versions. In order to differentiate their medications from counterfeits large companies have had to be creative in their detection methods.
Some of those methods used to differentiate genuine medications from counterfeit have included holograms, embossing, special ink and two-dimensional bar codes.[xxi] Many of these methods have proven to be easily reproduced by counterfeiters, such as invisible ink, which can be easily reproduced with any standard printer.[xxii] Some of these methods require special training to read the marking and to be able to tell a genuine from a fake. MPedigree launched a program which allows codes from medications to be sent through a text message for free and the code is checked and the consumer is told whether or not the medication is genuine.[xxiii]
One of the latest methods has been Cryptoglyph, which places an invisible dot pattern over an entire package or label. These markings are impossible to erase or duplicate. [xxiv] These are all steps in the right direction, however the common consumer can still easily be fooled into taking a counterfeit medication because to the naked eye the packages with the Cryptoglyph markings on them look the same as counterfeit packages. The markings are for the use of the pharmaceutical companies not the consumers.
V. Remedies
Intellectual property protection is not enough even in developed countries to keep counterfeit medications from being manufactured and distributed to consumers. In the United States the burden to remedy this problem rests primarily with the FDA and customs, as is a common problem in developed countries. Agents have done inspections at mail processing facilities in Los Angeles, in one month the agents had to inspect 16,000 packages. Of those, the examiners were only able to examine 721 packages due to manpower and budget restraints. None of the drugs were chemically analyzed. [xxv] This issue needs to be addressed.
All pharmaceutical packages need to be investigated and the medications checked to ensure they are genuine. 721 packages check out of 16,000 is unacceptable. This is a problem, which needs to be placed on the forefront of both developed and developing countries agenda. In developed countries, more resources need to be spent with agencies who have the man power to police pharmaceuticals being imported into the country. The time and money needed to adequately train individuals to check packages and properly identify counterfeit medications would be far less than the risk being placed on consumers of counterfeit medications.
Alternate methods must be used in less developed nations, where IP protection is not a practical solution. One alternate method to get medications to less developed nations is explained in Access to Global Disease Innovation, the method is called “global disease innovation.” This allows low-income countries to purchase patents for medications from pharmaceutical companies after the pharmaceutical companies have made back their money from the expensive research and development process, this allows the lower income country to obtain the patent at a discounted price. The countries then are able to manufacture the medications and have free access to the medication and this process doesn’t damage innovation incentives.[xxvi] This also lessens the likelihood of counterfeit medications because citizens now have easier access to the medications and do not have to attempt to get their medications from less than credible sources.
An article entitled Intellectual Property Rights of Pharmaceutical Companies Access to Medicines states “the imitation of the existing drugs is relatively low- tech and cheap. As a result, patent protection is crucial in recouping the cost of drug development.”[xxvii] Big pharmaceutical companies must aggressively and continually enforce their intellectual property rights for the medications to keep counterfeiters from making medications, which are supposed to replace those medications which are protected by patents. If companies do not do this counterfeiters will not be stopped from manufacturing harmful medications and selling them to unsuspecting people.
In order to further the mission to stop the manufacture and importation of counterfeit drugs, countries must have strict boarder patrols, more regulations through agencies such as the FDA in the United States, Customs Officials sort through shipments to identify counterfeit medications being shipped into the country, and finally, more emphasis to finding the manufacturers of counterfeits selling to online consumers and shutting down those websites and stopping the manufacturers. The Assistant director General for Health Technologies and Pharmaceuticals at the WHO states “international police action against the factories and distribution networks should be as uncompromising as that applied to the pursuit of narcotics smuggling.” [xxviii]Once caught the manufacturers need to be punished harshly and heavily fined to deter future conduct.
Counterfeit operations are hard to track and harder to catch. An article from Forbes magazine entitled “Bad Medicine” explains counterfeit operations as “small fly-by-night firms that operate out of shacks.”[xxix] Due to the ways these operations are run they are hard for government agencies to find and because they can move so easily it makes them harder to catch. Many counterfeiters sell to other operations who then re-sell the product. Many times there can be a long chain of people who have purchased the products making it hard to track the product back to the original source.
A major problem with counterfeit drug lies in the reporting practices. An article in PLoS Magazine describes the problem in the U.S. “In 2003, US pharmaceutical companies made an agreement with the US Food and Drug Administration (FDA) that they would report suspected counterfeit drugs to the FDA within five days of recovery...although this remains a voluntary agreement.”[xxx] The problem is many companies do not want to report counterfeit versions of their drugs for the fear consumers will stop buying their products all together. A voluntary agreement does not require the type of strict standards that are needed for stopping the counterfeit problem.
Large pharmaceutical companies have a conflict of interest in reporting counterfeit versions of their medications, they do not want to report for fear consumers will no longer purchase their medications and instead purchase from their competitors. The article also states, “the WHO has received no reports of counterfeit drugs from member countries after 2002.” This shows that because the agreement with the FDA is voluntary, pharmaceutical companies are opting not to disclose the suspected counterfeit drugs and instead conduct independent investigations on their own. Pharmaceutical companies have a vested interest in keeping counterfeits from being imported into the large nations where they sell their medications in order to maximize their sales, however, that doesn’t mean the burden to stop counterfeiting should lie in their hands. Governments have an interest in protecting their citizens and should play a more predominate role in the takedown of counterfeit operations.
Many underdeveloped countries do not even have this type of agreement to encourage consumers protection from counterfeit drug manufacturers. “Underdeveloped countries cannot subsidize the cost of patented medicines to the point where they are affordable. The pharmaceutical IP system simply doesn’t work for the world’s poorest people.[xxxi]
The Anti-Counterfeiting Trade Agreement (ACTA) is a treaty, which addresses counterfeit drugs. Under ACTA, member countries can seize and destroy suspected counterfeit goods. ACTA allows goods merely passing through the country to be seized, this is different because the goods do not have to originate or be bound for the country where seized. Under ACTA officials only need to suspect the goods to be counterfeit. This allows action to be taken by the officials going through the packages opposed to placing so much burden on the large pharmaceutical companies. [xxxii] If a majority of countries were to sign the ACTA treaty counterfeit medications could be more easily detected and the main manufacturers could be found and punished.
The WHO says government reports that counterfeiting is becoming “more sophisticated, making detection more difficult.”[xxxiii] Governments need to share their information about counterfeiting and their agencies need to work together and risk management through the media should be used.[xxxiv] If more countries sign ACTA and governments work together to stop manufacture and imports of counterfeit medications, the counterfeit drug problem could be greatly impacted.
Conclusion
Counterfeit drug manufacturing is a large and extremely dangerous problem that impacts all countries, developed and undeveloped alike. The dangers associated with counterfeit medications are consumers of the counterfeits do not get treated effectively, direct harm to the consumer’s health and drug resistance for both the consumer and others. Many methods have been attempted by pharmaceutical companies to detect counterfeit drugs, but many have proven to be replicable. The burden of stopping counterfeiting of drugs should not rest primarily with pharmaceutical companies who have conflicts of interest in reporting of such counterfeits. Instead governments need to heavily regulate the importation of goods coming into their countries and punish those counterfeit manufacturers in their nations.
Word Count: 3104
[i] WHO, Counterfeit Medicines. (2006)
[ii] id.
[iii] Palumbo, Francis. Counterfeit Drugs: Serious Threat or Ploy? Issue Introduction and Overview. (2008)
[iv] ACTA, 3 December 2010
[v] Civan, Abdulkadir. Intellectual property Rights of Pharmaceutical Companies and Access to Medicines. (2008)
[vi] Pasternak, Douglas. Knockoffs on the Pharmacy Shelf. (2001)
[vii] Supra n. 6.
[viii] Supra n. 1 and 2.
[ix] Grumbel, Peter. TimeHealth Magazine. How to Stop the Counterfeit-Medicine Drugs Trade. (2009)
[x] Harris et all. Keeping it Real. Combating the Spread of Fake Drugs in Poor Countries. (2009)
[xi] Supra n. 6.
[xii] Supra n. 6.
[xiii] Cockburn, Newton, et all. The Global Threat of Counterfeit Drugs: Why Industry and Governments Must Communicate the Dangers. (2005).
[xiv] Supra n. 9.
[xv] Drug Traders Paying Pharmaceuticals for Counterfeit Drug Detection. http://health.gbiportal.net/2011/07/07/ (2011)
[xvi] Supra n. 9.
[xvii] Supra n. 1.
[xviii] Supra n. 8.
[xix] Supra n. 6.
[xx] Supra n. 8.
[xxi] Meylan, Roland. Solutions to Combat Counterfeit Medicines Worldwide. (2009)
[xxii] Supra n. 21.
[xxiii] Mara, Kaitlin. Coverage of Anti-Counterfeit Policy Debate Varies Widely Across Global Media. (2010)
[xxiv] Supra n. 21.
[xxv] Supra n. 6.
[xxvi] Outterson, Kevin. Access to Global Disease Innovation. (2006)
[xxvii] Supra n. 5.
[xxviii] WHO. Counterfeit Medicines: the Silent Epidemic. (2006)
[xxix] Herper, Matthew. Forbes Magazine. Bad Medicine. (2005)
[xxx] Supra n. 7.
[xxxi] Supra n. 24.
[xxxii] Kaminski, Margot. An Overview and the Evolution of the Anti-Counterfeiting Trade Agreement. (2011)
[xxxiii] Supra n. 30.
[xxxiv] Supra n. 30.