Sunday, January 16, 2011

Can You Believe It? J&J Announces Another Recall...

McNeil Consumer Healthcare Initiates Yet Another Voluntary Recall Of Certain Products.

Just when you thought it could not get much worse for J &J, on Friday Johnson & Johnson’s McNeil Consumer Healthcare Division, in consultation with the U.S. Food and Drug Administration recalled certain lots of TYLENOL® 8 Hour, TYLENOL® Arthritis Pain, and TYLENOL® upper respiratory products, and certain lots of BENADRYL®, SUDAFED PE®, and SINUTAB® products distributed in the United States, the Caribbean, and Brazil.

The J &J company statement said that the recalled products were manufactured at the McNeil plant in Fort Washington, Pennsylvania prior to April 2010, when production at the facility was suspended. The company is initiating the recall as a precautionary measure after an extensive review of past production records found instances where equipment cleaning procedures were insufficient or that cleaning was not adequately documented. It is very unlikely that this impacted the quality of these products.

In addition, McNeil Consumer Healthcare is also initiating a voluntary recall of certain product lots of ROLAIDS® Multi-Symptom Berry Tablets distributed in the United States, in order to update the labeling. The company initiated the recall after determining that the product labeling does not include the language “Does not meet USP” as required by regulation.

According to the press release, McNeil identified the inadequacies as part of a thorough, proactive product quality and process assessment of all McNeil produced products.

On all levels this is a saga of an industry giant that has poorly managed the entire process of production, product quality control, regulatory affairs and public relations. J&J’s entire corporate image, trusted brands, executive management and financial future is in a significant state of decline.

J&J’s announcement of a comprehensive plan to clean up its production and public image is a operational and PR process that should have been initiated many months ago.

The lost sales, enormous expense in recalls and cost to the brands has to be a huge hit to J&J's bottom line.

This story is a cautionary tale for all, not making an investment in and failure to take the necessary steps to assure quality control and to protect your brand from sub-standard production, poor quality raw materials, fraud, adulteration and counterfeit will cost the stakeholders and consumer.

What are the odds that we will see another recall from J&J soon?

To learn more about supply chain authentication technologies, visit:

Wednesday, January 12, 2011

Freightwatch International: December 2010 Cargo Theft Report

FreightWatch International, an industry leader in providing cargo theft intelligence through data collection, analysis, and customized reporting, released their monthly report on cargo theft for December 2010.

recorded 64 incidents in December, a slight decrease in the average theft rate per month at the end of a very busy fourth quarter.

By location, California, Florida and Texas accounted the highest number of incidents in December, with 17, 13, and seven thefts respectively. This month, an average loss value of $383,350 resulted from the 25 incidents with reported loss values.

Violence in cargo theft remained low in 2010, however, three incidents occurred in December in which weapons were used in the acquisition of cargo, including two hijackings in Southern California and an armed robbery in Memphis.

FreightWatch is reporting four, very publicized pharmaceutical thefts in December:

• December 7th in Dallas, Texas, the theft of a trailer of pharmaceuticals of an unreported value.
• December 13th in Baltimore, Maryland the hijacking of a delivery van of pharmaceuticals of an unreported value.
• December 17th in Memphis, Tennessee a warehouse robbery and hijacking of delivery vans of an unreported value.
• December 23rd in Memphis, Tennessee a delivery van robbery valued at $439,000

The issue of pharmaceutical cargo theft energizes the need for material screening of products within the supply chain, from manufacturer to dispenser, to properly protect consumers everywhere.

As the value and prevalence increases, so too does the potential risk to consumers.

To read the entire report from Freightwatch International, visit:

To learn more about pharmaceutical material screening technologies, visit:

Sunday, January 9, 2011

Caution: The Rising Price of Fake Drugs

By: Alan Clock, Senior Vice President, XStream Systems, Inc.

The following is a re-post of a Secure Pharma Chain opinion blog from 2010:

Industry security experts are noticing a significant trend in the illegal counterfeit medication trade and unfortunately it does not bode well for the unsuspecting consumer.

Apparently the sophisticated drug counterfeiter is realizing that as the consumer and supply chain becomes more aware of this deadly crime, they must be more clever in marketing their wares publicly.

With the Internet and its anonymity the counterfeiter has been able to market directly to the supply chain and consumer. In the past all they had to do was to offer their bogus goods online at a dramatically lower price than the genuine product and they would automatically have a ready supply of buyers.

Today as the consumer becomes more aware of the exploding issue of fake medications they are heeding the buyer beware mantra of "if a deal is too good to be true, it probably is" and avoiding nefarious deals.

Naturally the smart counterfeiter is now raising his price, just enough to appear as if it is a dramatically discounted, genuine product but not too good to appear to be "too good to be true" to the end user.

The perfect, high margin crime of pharmaceutical counterfeiting is becoming even more lucrative.

Now more than ever, the pharmaceutical supply chain needs to protect itself by deploying a variety of safeguards and technologies to make certain that products that flow through their inventories are authentic and safe. Consumers need to be very diligent and cautious to make certain that they are buying their medications from a reliable and trusted pharmacy and not from sources that do not require prescriptions from your personal physician.

As it relates to your medications, "buyer beware" not only means protecting your pocketbook but protecting your health and well being as well.

To learn more about pharmaceutical anti-counterfeiting technologies, visit:

Friday, January 7, 2011

Drug Counterfeiting, Adapt or Perish

"Adapt or perish, now as ever, is nature's inexorable imperative." H.G. Wells

The following is a re-posting of an opinion blog in Secure Pharma Chain blog from 2010:

By: Alan Clock, Senior Vice President, XStream Systems

For those of us knowledgeable about the issue of counterfeiting, we have long been aware of the huge growing menace that has seemingly lurked in the shadows of the collective consciousness of the public at large for some time now.

Even for those who have been at the forefront of this serious threat, which the FBI dubs “the crime of the 21st century”, currently there seems to be a heightened sense of concern about how quickly this criminal activity is proliferating. It would appear now that this threat is advancing well beyond even our own alarmist predictions.

To date, much of the death and destruction associated with counterfeiting activity has occurred off the radar screen from the populace of privileged, developed nations and instead in the isolated world of underdeveloped areas and their residents.

For some of us with the advantage of a prosperous free market system, we have been somewhat immune to the spectacle of the criminal poisoning of disadvantage populations, which happens routinely in Africa and Asia by the purveyors of this insidious transgression.

In 2010, the widely accepted World Health Organization’s estimate is that pharmaceutical counterfeits are a $75 billion industry with an annual growth percentage of 12-16%. The World Customs Institute estimates that food counterfeiting is a $49 billion annual enterprise.

According to the study of Counterfeiting Intelligence Bureau of the International Chamber of Commerce counterfeit goods make up conservatively 5 - 7% of World Trade which the International Anti-Counterfeiting Coalition calculates would make the current global counterfeit economy the world’s biggest single business.

We now find ourselves in a perfect storm that will expand counterfeit criminal activity well beyond our wildest estimates and make it far more deadly in scope and size. The primary elements feeding this calamity include:

· a worldwide economy in a downward spiral
· ineffective regulations and laws on the crime of counterfeiting
· spotty or careless enforcement of existing laws on counterfeiting
· disjointed supply chains that cross multiple governmental boundaries and jurisdictions
· huge taxes on critical commercial markets like healthcare that are squeezing both the business and the onsumer to look for cheaper goods
· a collective lack of knowledge and leadership by governments around the globe to protect their constituents
· industries that choose to ignore the threat to their businesses instead of protecting their brand and customers
· a collective lack awareness of the deadly nature of the threat of counterfeits by consumers worldwide, most consider this a harmless act

Until now, this criminal activity, although grand in its size has really been driven by single individuals or disparate organized entities that realize how lucrative and safe this nefarious criminal activity has become. Criminals understand that counterfeiting is the perfect crime:

· there are few ways to get caught
· if they do get caught their activity carries almost no significant ramifications
· most often their crime will not be discovered for some time giving them plenty of time to cover their tracks and escape
· they have a global marketplace where they can carry out transactions anonymously in cyberspace
· the profit margin derived from counterfeiting transcends what most businesses make in a legitimate activity

Even as this perfect crime expands to educated and developed nations, we now seem at the precipice of something far more dangerous and deadly as this menace seems likely to evolve into something much larger in size and scope and far more insidious as a whole.

Many experts now fear the inevitable, when terror organizations, who are not driven by greed but rather destruction, realize the relative ease and deadly effectiveness that a purposeful counterfeiting event could trigger in a region or nation. Be it in a consumer good, food stuff, electronics or medication, one single, simple adulteration could literally harm millions with relative impunity.

Adapt or Perish, the time is now for governments, industry and consumers to understand the need for solutions to protect themselves from the various nefarious sources that threaten their health and wellbeing.

Today there are many technologies and services available that can offer protection to industry and consumers from those who would seek to profit or cause destruction. Leaders in governments and industry around the globe need to act now to protect entire populations.

Although no one solution, to date provides a single, "iron clad" solution to this scourge, when appropriately layered, these existing solutions can and do create effective and efficient security to protect supply chains and consumers from fraudulent, adulterated and counterfeit products.

To learn more about, anti-counterfeiting solutions, visit:

Thursday, January 6, 2011

Straight Talk: Fake Drugs Are Real

US Pharmacist magazine prints an excellent “straight talk” editorial about counterfeit drugs in its December 2010 issue.

Harold E. Cohen, Editor-in-Chief of US Pharmacist writes an extremely frank and insightful editorial on the problem of counterfeit medication globally and encapsulates it concisely.

Mr. Cohen's entire “Straight Talk” editorial titled Fake Drugs Are Real follows:

Now that the hoopla and celebrations over the midterm election results are quickly fading, Congress, with its newly elected members, will soon have to get down to the serious and daunting tasks of fixing the economy, reducing unemployment, exploring defense spending, and paying more attention to health care in the United States. While the provisions of the original health care bill will continue to be hotly debated, there is another health care crisis in the U.S. and other countries that has been growing exponentially for more than a quarter of a century and that seems to get little or no political attention.

According to the World Health Organization (WHO), the appearance of counterfeit medicines in international commerce was first mentioned as a problem at a WHO conference in Kenya in 1985. The proliferation of fake drugs is so widespread that no organization or business analyst can accurately predict the value of this trade to the counterfeiters or the number of lives it has affected; but by some estimates, 10% of all global drug sales are counterfeit, with some observers saying the total could be as high as 25%. And fake drugs put some $75 billion into the pockets of their distributors. While the pundits may argue over the actual figures, one thing virtually all of them agree on is that the widespread use of the Internet is the fuel powering the enormous growth in the distribution of counterfeit drugs worldwide. The WHO estimates that 50% of all medicines sold online are counterfeit. According to the Pharmaceutical Security Institute, last year nearly 1,700 incidents of counterfeit drugs were reported, triple the number in 2004.

The counterfeiters apparently spare no therapeutic category. The WHO reports that 60% of all the counterfeit drugs are manufactured to treat the most popular therapeutic categories, including antibiotics, hormones, analgesics, steroids, and antihistamines. Most recently, counterfeit drugs have popped up in very unlikely products as well. For example, the FDA recently reported that counterfeiters have infiltrated the surgical mesh market. Surgical mesh is used to reinforce soft tissue during surgery. And this past summer, the FDA warned about fraudulent Tamiflu sold over the Internet as “generic tamiflu.” In this particular scam, the product did not contain Tamiflu's active ingredient, oseltamivir, but cloxacillin, an ingredient in the same class of antibiotics as penicillin. And as if that were not enough, earlier this year the FDA issued a warning about a counterfeit version of the OTC weight-loss product Alli 60-mg capsules (120-count refill pack). A favorite arena for selling this particular product was online auction sites.

To put the profitability of fake drugs into perspective, an associate director for global security at Pfizer in Europe reports that the profit margin from counterfeit Viagra is some 10 times higher than that of the street drug heroin. A former FBI agent is quoted as saying, “Instead of punching out ecstasy tablets, counterfeiters can reload pill-producing machinery and make Lipitor.” At a recent drug seizure in Istanbul, investigators nabbed 700,000 fake Viagra pills alongside 51 kg of heroin.

It is estimated that the number of lives taken by counterfeit drugs could be as high as a million worldwide. For this reason, it is incumbent on pharmacists to continue warning their patients about the risks of buying drugs on the Internet and to be vigilant about checking the credibility of their suppliers. Fake drugs are real and are not going away anytime soon

The final sentence from Mr. Cohen’s editorial is very encouraging and spot on, clearly the pharmacist, one of the most important healthcare providers to consumers around the globe, is a critical resource in informing the consumer and in making certain that the members of the supply chain maintain high standards in deploying solutions to protect their inventories from fraudulent, adulterated, sub-standard and counterfeit medications.

To access the editorial in the December 2010 of US Pharmacist, visit:

To learn more about pharmaceutical anti-counterfeiting technology, visit:

Wednesday, January 5, 2011

The Decade of the Counterfeit-Part Two

The is the second and final installment of a two part opinion blog by Alan Clock, Senior Vice President at XStream Systems, Inc. that was first posted last January on Secure Pharma Chain. Part One was posted yesterday.

How do we as a society both domestically and globally solve this growing threat and eliminate the danger that looms as its deadly consequence to us all?

We now live in a worldwide, global economy. Trade and industry superpowers have emerged beyond the traditional European and North American developed nations. Comprehensively all industries have had enormous movement of production into underdeveloped nations, even those that have a tradition of trade riddled with fraud, counterfeiting and corruption. These countries with well know nefarious sources of supply, now find themselves as a primary producers of everyday consumer products that are in foodstuffs, household goods and medications on the retail shelves of Main Street USA.

The reality, unknown by many, is that this counterfeit phenomenon is growing and going well beyond the borders of the undeveloped world. Today, not one product, not one place, not one person is immune from the impact of counterfeit and fraudulent products. It is likely that we will continue to see this counterfeit boom continue unabated indefinitely.

How this phenomenon is happening is both complex and simple. This is a global event which adds to its complexity, but it is driven by easy money which is very straightforward to understand.

As such, some of the major factors driving the unprecedented proliferation of counterfeit products around the globe decade include:

• Global economies and worldwide supply chains. As companies become more global and procure raw materials and contract production overseas due to lower costs and expense, the supply chains become much more difficult to control and monitor. Companies lose control over their production, intellectual property and quality control. Regulatory processes and enforcement in third world countries lag behind the developed world and institutional control. Nefarious vendors can contaminate for quick profit a product by providing poor quality or adulterated raw materials prior to production. Without adequate controls manufacturers, distributors, retailers and consumers find themselves vulnerable to poor quality, contaminated or fraudulent materials. Often by the time an issue is discovered the product is well within distribution, its source difficult to pinpoint with the perpetrators long gone. Unfortunately by that time the impact of the bogus product has been borne by thousands.

• Ineffective laws and regulations. As a global economy expands, products move across multiple borders making them increasingly vulnerable and allowing for organizations to take advantage of legal loopholes, breaks in regulatory authority and the ability for law enforcement to adequately monitor movement of goods and services. Penalties for criminal activities also exacerbate the situation. A criminal organization can make more profit with less risk of being caught or with any significant legal ramifications by counterfeiting than almost any other criminal activity. Basically it is easier to counterfeit products, with much less risk and much more profit than in any other legitimate or illegitimate activity.

• Growth of the internet and unrestricted, instant access to millions of consumers. In the 21st century, counterfeit organizations can directly or indirectly market and sell their wares online, 24 hours a day in relative anonymity. These organizations can set up websites and fulfill transactions with only a few key strokes and completely camouflage their operation. By the time a regulatory body, law enforcement agency or consumer finds a fake product the marketing source or website and operation is long gone into a hazy cyber world.

• The global financial meltdown that occurred in the last half of the decade has caused many retailers and consumers to look at the price of materials, focusing less on quality and authenticity. As incomes and profits fall, so do the standards of the producer or consumer as they scramble to find the products and materials that they rely on. This is a dangerous environment where counterfeit organizations thrive. A perfect scenario for fraudulent activity occurs when members of the supply chain focus on price over cost and fraud. The criminals know that by the time their crime is discovered they have little chance of being held accountable.

• The lack of brand protection and security by members of the supply chain. Many manufacturers, distributors and retailers have been slow to realize the huge impact that counterfeit products have and could have to their businesses. Many have had and continue to show a lack of strategy in dealing with this issue, ostensibly because they have not educated themselves on the problem or they do not have the necessary solution to effectively deal with it. Regrettably until most of these organizations face the liability or brand erosion of a catastrophic event caused by fraudulent activity they simply ignore the issue altogether.

• The lack of implementation or acceptance of comprehensive solutions to combat counterfeiting. There have been scores of regulatory bodies, legislation and industry groups make attempts to implement comprehensive solutions to counterfeit activities. Most initiatives prove to be ineffective, based on their lack of acceptance, expense and their complicated approach. Functionally most of these solutions are based on a transactional approach. A transactional approach relies on the supply chain to continually interact and exchange data. This constant information exchange in real time is difficult at best and extraordinarily expensive at worst especially when you are dealing with a far reaching, global supply chain.

Additionally transactional methods only deal with the product package and not the material or product itself. Some of the largest and most egregious fraud and counterfeit events of the past several years were products that had pristine transactional pedigrees but the product on the inside of the package was adulterated or fraudulent, causing harm to thousands of end use consumers and millions in losses to the brand.

To date, most industries seem to have taken a wait-and-see approach driven by the cost of current solutions, which ultimately means that the initiatives die as the events which caused the activity loses momentum over time. The reality is that eventually business leaders within the supply chain have a “hear-no-evil, see-no-evil” attitude as it relates to this issue because they posses few answers and have little to no government or industry leadership to the mandate or guide them.

The dilemma of the next decade is how to marshal our resolve as a society globally and properly respond to the multiple factors which have driven this decade of fraudulent, adulterated and counterfeit products that have proliferated in the 21st century.

First and foremost, to win this battle, there needs to be a universal awareness of how prevalent and how dangerous this issue actually has become. Consumer’s awareness and their rejection of products that are not vetted and authenticated is critical.

Additionally, regulatory authorities across the globe need to be motivated, synchronized and resourced appropriately so as to eliminate the shadows and safe havens that allow counterfeiters to thrive.

Finally, industry and supply chains need to understand and realize the profit, loss and liability that exist if they do not deal with counterfeits head on. Each of the stakeholders of the consumer supply chain, from corporations to consumer, need to push for sophisticated solutions and eliminate this potentially deadly threat.

Vital to these three primary steps is the realization from all; manufacturer to consumer, is the understanding what this counterfeiting is currently, but what it can become if not properly addressed.

Most ominous is the potential for counterfeiting to evolve beyond the simple criminal act to becoming a massive terror threat is very real. As it stands today, millions die each year from individual criminal counterfeit acts, if done with a coordinated murderous intent; a terrorist element could comprehensively impact the health and mortality of an entire country or society.

Fortunately the solutions are at hand, today there are technologies that can be comprehensively layered to protect the various members of the supply chain, within individual channels to follow transactions, screen materials and authenticate the validity of products at each step of the sequence as it makes its way to the consumer.

One such solution is a technology known as EDXRD. This innovative technology allows the user to molecularly screen the product inside its original container without destroying or degrading the product, thus minimizing the need for Track and Trace or transactional solutions. Basically this solution adds functionality from the transactional and looking at the outside of the container to looking inside the container with Molecular Screening. Ultimately, this type of solution provides each member of the supply chain the confidence to know that their inventories safe and efficacious.

In the end, layered deployment of technology solutions, consumer awareness and a coordinated regulatory/law enforcement process will be the most effective strategy to lessen this very dangerous, criminal activity. When the criminal elements realize that there is little profit and a realistic chance that they will be held accountable for their actions, the deadly issue of counterfeit and fraudulent products will drastically decline and the Decade of the Counterfeit will become a brief historical story of how technology and public awareness save the day.

Alan Clock, Senior Vice-President of XStream Systems has over 20 years of pharmaceutical, healthcare and sales distribution experience. Mr. Clock has an impressive track record of promoting comprehensive solutions to healthcare providers, distributors, large corporate entities, group purchasing organizations, employer groups and managed care organizations. He has held senior sales executive and national account roles for major Fortune 100 healthcare industry leaders and has successfully negotiated and sold billions of dollars in multi-year pharmaceutical service, software, equipment, packaging and consulting agreements.

Tuesday, January 4, 2011

The Decade of the Counterfeit-Part One

This is the first installment of a two part opinion blog by Alan Clock, Senior Vice President at XStream Systems, Inc. that was posted last January on Secure Pharma Chain.

The first decade of the 21st century could carry many labels given the rise of global terrorism, a bursting housing bubble and a worldwide financial meltdown. However one very appropriate label, albeit lesser known by the masses, would be the Decade of the Counterfeit.

Although counterfeit materials and fraudulent supplies have been around for centuries, with the emergence of far reaching global supply chains and an expanding worldwide economy, the criminal activity of producing counterfeit goods have propagated and is impacting a greater number of consumers more than ever before.

In modern times counterfeit products go well beyond the conventional bogus purses and knock off apparel that we traditionally associate with this fraudulent activity. The scope and audacity of the contemporary counterfeiter goes well beyond what has traditionally been considered to be a victimless crime.

Today’s counterfeit products include every product that is used today. This runs the gamut from commercial aircraft parts to sophisticated electronics, and from consumer goods to food and life saving healthcare products. Counterfeited products include all of the goods that consumers rely upon for their safety and well being. At best, these bogus products fall short of their consumer’s expectation while at worst they threaten a population’s safety and overall health.

An insidious example of how counterfeit activity can create a deadly consequence and cause thousands to die is documented by the issue of counterfeit drugs causing drug resistant disease strains in underdeveloped countries in Africa and Asia.

With medical science producing drugs that can effectively cure or curb diseases such as tuberculosis, malaria and HIV/AIDS, unscrupulous counterfeiters are producing fake drugs with only a trace of the real drug’s active ingredient. The counterfeiters put only enough of the real ingredients in to fool rudimentary testing processes. The unfortunate side effect of these bogus treatments is that not only do they not provide any therapeutic cure, they actually create more dangerous strains of the disease that are impervious and resistant to the known drug regimens used to treat the illness.

The World Health Organization estimates that upwards of 2,000 children per day die as a result of taking counterfeits medications in Africa alone.

Well over 1 million children die in Africa and Asia die each year because of counterfeit drug medications.

A few global statistics from the World Health Organization regarding pharmaceuticals, even further energizes the debate regarding the label Decade of the Counterfeit:

• In 2010, the World Health Organization (WHO) conservatively estimates that counterfeit medications will be a $75 billion industry worldwide.

• The WHO projects growth of counterfeit medications to be over 12-16% annually, worldwide.

• The WHO Reports that globally 10% of Pharmaceuticals are counterfeit, fraudulent or adulterated.

How do we as a society both domestically and globally solve this growing threat and eliminate the danger that looms as its deadly consequence to us all?

Alan Clock, Senior Vice-President of XStream Systems has over 20 years of pharmaceutical, healthcare and sales distribution experience. Mr. Clock has an impressive track record of promoting comprehensive solutions to healthcare providers, distributors, large corporate entities, group purchasing organizations, employer groups and managed care organizations. He has held senior sales executive and national account roles for major Fortune 100 healthcare industry leaders and has successfully negotiated and sold billions of dollars in multi-year pharmaceutical service, software, equipment, packaging and consulting agreements.

View Part Two of the opinion blog tomorrow on Secure Pharma Chain.