Pharmalot: Moms and Docs Think Less of Johnson & Johnson

A new survey finds the health care giant’s reputation has declined 27 percent among mothers, 31 percent among pediatricians and 23 percent among general practitioners.

Once again, Ed Silverman in the September 29th edition of his Pharmalot blog, examines the repercussions to the reputation of industry giant J&J in the wake of their recent recall scandal.

Here are some of the highlights of the blog post:

• If anyone thought the very messy recall scandal would blow over and Johnson & Johnson would emerge unscathed, they may want to think again. A new survey finds the health care giant’s reputation has declined 27 percent among mothers, 31 percent among pediatricians and 23 percent among general practitioners.

• Looked at another way, all three groups rated its reputation as an 8 - on a scale of 1 to 10 with 1 as horrible and 10 as perfect - before the recalls. Now, all three groups rate J&J between 5 and 6. The survey of 139 mothers and 50 physicians was conducted by CLSA analyst David Maris, who says that, since some moms will moms and docs have permanently changed their view of J&J, “this is serious.”

• On a scale of 1 to 10, with 1 = not serious at all and 10 = extremely serious, moms were asked how serious they believed the recalls were. The average rating was 7.3. Meanwhile, 72 percent of the moms said the recalls have not permanently changed their view of J&J, and 56 percent will continue to trust the J&J brand. But 28 percent say the recalls have permanently changed their opinion. Of pediatricians, 60 percent will not change their prescribing habits for J&J products, but 28 percent of pediatricians and 36 percent of GP's say the recall is a serious quality issue.

• 53 percent of the moms trust J&J the most when compared to store-brand products offered by Wal-Mart and CVS, but 29 percent thought J&J brands were no better or worse than those store brands. And 48 percent of the docs say they may prescribe or recommend more non-J&J products in the future given the recall. Such as? generic versions of ibuprofen, acetaminophen,
diphenhydramine, Merck/SGP’s OTC Claritin, and Pfizer’s Children’s Advil. A field day for J&J rivals, yes?

• The health care giant is under a microscope for allegedly trying to hide from the FDA and consumers that some products were tainted and the hearing will be the first time that Weldon has appeared in public this year to address the problem. Small wonder moms and docs react the way do.

• Here’s how one doc answered the survey: “Your products are still not available. You have made my job more difficult. Answering tons of calls regarding the lack of fever reducer for children - “what do we do now?” Use generics, they are just as good.” And another: “Not permanently damaged, but J&J will have to do major PR to earn back customer’s trust and confidence in their products. Have to remember target audience like moms who are scared to death to use J&J products on their beloved children.”

• “We think negative changes in corporate reputations are serious and the ramifications may be slow to become apparent,” he writes in a report. “Doctors and consumers think that there are more things J&J can do to rebuild trust and confidence, with open and direct communication being most highly cited. Time will tell whether J&J successfully rebuilds this confidence and whether there are any longer-term consequences for the recalls.”

Clearly the entire pharmaceutical supply chain needs to take lessons from J&J’s mis-steps. Quality control and protection from fraudulent, adulterated and counterfeit medications are taking a serious toll on all of the members of the supply chain, not to mention most importantly the consumer.

To read the Pharmalot blog, visit: http://www.pharmalot.com/2010/09/moms-and-docs-think-less-of-johnson-johnson/#more-26662.

To learn more about pharmaceutical authentication technologies, visit: http://www.xstreamsystems.net/.

Securing Pharma: Bangladesh Carrying Heavy Counterfeit Medicine Burden

Business Monitor International estimates that spurious medicines account for around $150m of Bangladesh's total prescription and over-the-counter pharmaceutical market of around $1.16bn.

Securing Pharma in a September 23rd post, details a recently published report, entitled Bangladesh Pharmaceuticals & Healthcare Report Q4 2010 compiled by Business Monitor International.

According to the Securing Pharma story:

• Testing of 5,000 medicine samples this year by the government of Bangladesh revealed that 300 or 6 per cent were either counterfeit or of substandard quality, according to Business Monitor International.

• The country's Public Health and Drug Testing Laboratory found that many of the fake or low-quality products were antibiotics and other potentially life-saving medicines and therefore pose a risk to public health.

• The market research firm estimates that spurious medicines account for around $150m of Bangladesh's total prescription and over-the-counter pharmaceutical market of around $1.16bn.

• The main channels for distribution of the substandard and counterfeit drugs seems to be the country's huge network of unlicensed pharmacies - which could number as many as 80,000 according to some estimates.

• "It is thought that these counterfeit products are produced in numerous drug factories situated along the Bangladeshi, Indian, Pakistani, Chinese and Thailand borders," comments BMI in the report.

This criminal act now effectively impacts and entire country’s health and well being especially when many of the bogus drugs go beyond the traditional life style drugs and instead are basic antibiotics and life saving medications.

In Bangladesh counterfeit medications are now a deadly part of the legitimate pharmaceutical supply chain.

The issue of adulterated, fraudulent and counterfeit drugs has transcended from individual criminal acts to a well organized industry that sells disease and death.

All members of the global pharmaceutical supply chain must protect their inventories and consumers from these bogus fakes by deploying anti-counterfeiting technologies and solutions.

To read the entire Securing Pharma story, visit: http://www.securingpharma.com/40/articles/588.php.

To learn more about pharmaceutical anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

Leading Nigerian Official Fighting Drug Counterfeiters Survives Attack By Gunmen

Dr. Paul Orhii, the Director General of Nigeria's National Agency for Food and Drugs Administration and Control (NAFDAC), survives an attack on his life.

In a story which appeared in Afrique en Ligne, unknown gunmen attempted to kill Dr. Paul Orhii, the Director General of Nigeria’s National Agency for Food and Drugs Administration and Control (NAFDAC).

NAFDAC is charged with fighting the problem of counterfeit drugs in Nigeria. Nigeria is a country whose population is at the epicenter of the counterfeit drug trade and its impact as caused significant health care issues and death to consumers of bogus medications.

Dr. Orhii was attacked by unknown gunman in his car as he was returning from his village in northern Benue state to the capital city of Abuja.

According to the Afrique en Ligne story:

• A Mercedes Benz car in which four gunmen were riding pulled up next to the NAFDAC SUV that Orhii was riding in at Akwanga, along the Keff-Abuja road and one of the men in the sedan pulled out a gun and attempted to shoot at the Director General. The police escort behind Orhii's vehicle was able to ram the SUV, distracting the shooter. Policemen quickly jumped out of their vehicle to surround the gunmen’s car, however they were ordered not shoot to avoid killing innocent civilians, and the gunmen escaped.

• Orhii and NAFDAC are determined to put an end to the proliferation of fake drugs in Nigera and have declared war on importers and manufacturers of counterfeits.

• This is not the first attack on the life of a NADSAC representative in Nigeria. In August, a number of NAFDAC officials, in the process of confiscating goods from a fake drug dealer in Onueke, Ezza South Local Government Area, were attacked in the Ebonyi State by a mob of youths who were reportedly bribed by counterfeit drug dealers.

• An attempt on the life of the former NAFDAC boss, Professor Dora Akunyili, who is now the Minister of Information, was made in 2003 while returning from his village in southeastern Nigeria.

• Orhii recently appeared in a HDTV special with Dan Rather regarding his efforts to rid Nigeria of counterfeit drugs.

The huge profits from the criminal activity of counterfeit pharmaceuticals can dwarf the profitability of the trade of illicit drugs and this act has attracted violent organized gangs.

Counterfeiting is not a victimless crime of knock off purses or designer clothing perpetrated by individuals but a serious organized threat to consumers globally.

As violent criminal enterprises that trade in this deadly activity increases so to does the threat to consumers proliferate world wide. Counterfeit drug victims are not people who chose to take drugs from nefarious sources but do so because they have been duped, often with significant ramifications to their health and well being and very often with deadly consequences.

Dr. Orhii is a prominant leader in taking on these violent criminals in Nigeria and it is time that officials and industry leaders around the globe take similar action against these organizations that threaten entire unsuspecting populations with their bogus wares.

To read the entire Afrique en Ligne story, visit: http://www.afriquejet.com/news/africa-news/nigeria:-head-of-nigeria.

To learn about technologies used to fight counterfeit drugs, visit: http://www.xstreamsystems.net/.

Securing Pharma: California Task Force Will Tackle Online Fake Drugs Trade

A task force has been created by the US Attorney’s Office in San Francisco to combat counterfeit pharmaceuticals and money laundering on the Internet, according to a report from the Pharmaceutical Cargo Security Coalition.

Securing Pharma in their September 22nd post reports on a new Federal task force specifically set up to handle fake drugs.

According to the Securing Pharma:

• Working with Immigration and Customs Enforcement and the Internal Revenue Service, the first focus of the task force will be counterfeiting activities in the Northern Judicial District of California, but the intention is eventually to expand its focus nationwide and even overseas.

• The team’s location is considered to be strategic because of the high density of Internet financial service vendors on the west coast of the USA, including iOffer, eBay and PayPal.

• "Any transaction(s) through these companies technically give this group legal venue on future investigations outside of the Northern Judicial District of California, as well as abroad," commented PCSC.

This new task force is obviously a huge step forward as it relates to taking the fight to these criminals who have for too long been able to ply their deadly wares directly to the consumer.

Secure Pharma Chain endorses and encourages all regulatory oversight in combating fraudulent, adulterated and counterfeit drugs. Secure Pharma Chain encourages all members of the pharmaceutical supply chain to take proactive measures in securing their inventories from this criminal element and their deadly, bogus medications.

To read the entire Securing Pharma blog post, visit: http://www.securingpharma.com/40/articles/585.php.

To learn more about anti-counterfeiting technologies designed for pharmaceuticals, visit: http://www.xstreamsystems.net/.

Illegal Internet Drug Dealer’s Mansion Up For Auction

Bidding starts at $1.5 million in an online auction next month for an Arlington home forfeited by a convicted Internet drug dealer.

As reported in the Dallas Morning News and the Associated Press, the massive mansion formerly owned by Rakesh Saran, a convicted Internet drug dealer is appraised at $3.7 million, was seized after Saran's 2005 arrest in an investigation of more than 20 illegal Internet pharmacies.

Saran in 2006 pleaded guilty to one count of conspiracy to commit health care fraud, two counts of mail fraud, one count of conspiracy to distribute controlled substances. He was sentenced to 12 years in prison and ordered to pay $68 million in restitution.

Going after the assets of the criminals who are poisoning populations with fraudulent, adulterated and counterfeit medications is a significant step forward in attracting the necessary publicity so that the average health care consumer understands the danger this crime is to them.

All members of the pharmaceutical supply chain need to deploy solutions and technologies to combat this clear and present danger to their business and consumers.

To read the entire Dallas Morning News article, visit: http://www.dallasnews.com/sharedcontent/APStories/stories/D9I92J2G1.html.

To learn more about pharmaceutical anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

Man Charged with Selling Fake Drugs in Wisconsin Faced Illegal-Drug Charges in Texas

Balbir Bhogal a man now facing Federal charges for peddling fake Viagra had been arrested and charged in 2002 for running a bogus pharmacy in Texas and possessing multiple illegal drugs.

Dan Simmons in the Wednesday, September 15th edition of the Wisconsin State Journal reports on a story previously posted in Secure Pharma Chain.

Along with prominent Madison pharmacist and businesswoman Marla Ahlgrimm, who owns Women's Health America and serves on the UW Foundation board, Mr. Bhogal was jailed on federal charges that the pair had sold millions of doses of fake Viagra and other drugs, and conspired to illegally sell painkillers.

According to the Wisconsin State Journal article:

• The Middleton man charged recently with peddling fake Viagra had earlier been arrested and charged in 2002 for running a sham pharmacy in Texas and possessing multiple illegal drugs, according to court records.

• "He was certainly a predator type," said Andrew Walters, police chief of Oakridge North, Texas, where Balbir Bhogal was charged in October 2002.

• A complaint filed last month in U.S. District Court in Brooklyn alleges renowned Madison pharmacist Marla Ahlgrimm, 55, and Bhogal, 63, imported and sold millions of doses of fake Viagra and other counterfeit drugs and conspired to illegally sell stimulants and tranquilizers.

• In the 2002 case, Bhogal was charged with five felony counts of possessing illegal drugs after an undercover police raid allegedly found cocaine, crack, marijuana and a rave drug known as Special K, among other illegal substances including a Fed Ex package containing phentolamine mesylate, used for erectile dysfunction in men, at his storefront herbal supplement store in Oakridge North, about 30 miles north of Houston.

• "It is speculated that Bhogal was making his own ‘viagra' pills," a detective wrote as part of the incident report. But Bhogal was not specifically charged for it then, Walters said.

• At the time, he was identified as an assistant professor at the Baylor College of Medicine and a package addressed to him bore the address of the Veteran's Affairs hospital in Houston, according to the court records. Representatives at both institutions declined comment Wednesday.

• He was sentenced to probation on the charges in April 2004 before the charges were dropped for unknown reasons in 2006, according to Walters and court records.

• It's not clear how Ahlgrimm came into contact with Bhogal, a consultant at her business, Women's Health America of Madison. In court records he's also described as a "registered agent" at Nutragen, L.L.C., a Madison pharmaceutical company.

• According to the recent complaint, a confidential source told the FBI about buying millions of tablets of prescription drugs from Ahlgrimm and Bhogal. Another informant reported ordering prescription painkillers and erectile dysfunction medication that, when intercepted by authorities, were found to be fake or ineffective.

When trusted professional health care providers and prominent pharmaceutical supply chain members become actively involved in the criminal and deadly act of drug counterfeiting, it is vital that the members of the supply chain protect their businesses and consumers from bogus medications.

This is no longer a crime that occurs and impacts the populations of underdeveloped nations.

Verifying and securing inventories is now a vital and necessary process.

To read the entire Wisconsin State Journal article, visit: http://host.madison.com/wsj/news/local/crime_and_courts/article_ad573bec-c126-11df-b94e-001cc4c03286.html.

To learn more about pharmaceutical anti-counterfeiting technology, visit: www.xstreamsystems.net.

SafeMedicines: Ukraine Shut Down 149 Illegal Pharmacies in First Half of 2010

Ukrainian officials shut down nearly 150 pharmacies in the first half of 2010 because they were suspected to be selling counterfeit drugs.

SafeMedicines.Org is blogging on a report from NRCU regarding an inspection of Ukrainian pharmacies conducted by Ukraine’s State Drugs Inspectorate. Following the inspections, 149 pharmacies within Ukraine were found not to meet requirements primarily due to substandard and counterfeit medicines and were shut down.

According to the NRCU report:

• About 20 percent of newly opened pharmacies had their licenses immediately revoked as soon as they were inspected.

• "Exactly those pharmacies are the potential and real sources of the spread of substandard and counterfeit medicines among the consumers", Inspectorate Chairman Oleksiy Soloviev said.

• The licensing procedures for new pharmacies were simplified in February of this year, causing a three-fold increase in the amount of pharmacies over the last eight months, according to the news source.

As adulterated, fraudulent and counterfeit medications continue to pour into the legitimate supply chain it becomes even more important for all members of the global pharmaceutical supply chain to deploy solutions and technologies to protect their inventories and the consumer from these deadly bogus drugs.

To read the SafeMedicines blog, visit: http://www.safemedicines.org/2010/09/ukraine-shut-down-149-illegal-pharmacies-in-first-half-of-2010.html.

To learn more about pharmaceutical anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

PharmTech: Q&A With Anti-Counterfeiting Experts to Discuss Terrorism as a Source of Counterfeit Products.

The growing problem of counterfeit drugs poses an increasing threat to public health and the health of the pharmaceutical industry.

Alexis Pelleck in the September 2nd issue of Pharmaceutical Technology conducts a round table discussion focused on authentication technologies as a means of identifying and detecting genuine products.

Ms. Pelleck begins the conversation by looking at terrorist organizations as producers of counterfeits and conducts a Q&A with John D. Glover, formerly of the FBI and US State Department and discusses links between terrorism and counterfeits. Mr. Glover’s comments are an excellent source of insights regarding the global link of terrorism and counterfeiting.

Ms. Pelleck then conducts Q&A with some leaders of companies that offer authentication technologies.

Some of the highlights from Mr. Glover’s Q&A which discusses counterfeiting links to terrorism:

• In 2000, Terry Anslow, chief investigator of the Crime Unit of the European Leisure Software Publishers Association, reported that terrorists have found counterfeiting to be a lucrative means of raising funds.

• As early as 2001, Alan Slobodin, senior counsel for the US House Energy and Commerce Subcommittee on Oversight and Investigations, stated that there was strong evidence linking the sale of counterfeit medicines on the Internet to terrorist organizations in the Middle East.

• In 2002, the US Customs Service warned of an increasingly close connection between transnational crime and terrorism, with the profits from pirated and counterfeit goods being the strongest link.

• In 2003, the secretary-general of Interpol reported that the pirating of products such as computer software, CDs, and DVDs was becoming the preferred method of funding for a number of terrorist organizations. He mentioned direct and indirect connections between counterfeiting and Hezbollah, Chechen rebels, extremist groups in Kosovo, and al-Qaida, among others.

• The US State Department, in 2004, wrote that the tri-border region of South America—Argentina, Brazil and Paraguay—is a regional hub for Hamas and Hezbollah fundraising activities, including the manufacture and distribution of pirated goods.

• Additionally, some law enforcement agencies have linked al-Qaida to the sale of fake perfumes and shampoos.

• In the early 1990s, the Irish Republican Army (IRA) set up a laboratory in Florida to produce fake vials of an anti-parasitic drug for livestock. The labels for the fake pharmaceuticals were printed on a Northern Ireland farm. Proceeds from the operation were sent to the IRA to purchase arms.

• Although not directly on point, it was widely reported in 2002 that Hezbollah generated millions of dollars by smuggling pharmaceuticals from Canada to clandestine labs in the US to produce methamphetamine.

• Experts currently believe that because the traditional sources of funding for terrorists groups are being restricted by US law enforcement agencies and our allies, terrorist organizations have turned to profiting from the manufacture and sale of pirated and counterfeit goods. International law-enforcement activities are believed to be making a difference in the sources of funding of terrorist activities. Terrorists are avoiding formal financial channels, and are engaging in riskier behavior such as smuggling, pirating of goods, and counterfeiting.

• Counterfeiting is a serious crime that poses a threat to health and safety, yet the criminal sanctions against this heinous behavior are light. Given the potential for large profit, coupled with a low detection rate and comparatively light sentences, there is little to deter potential violators. This needs to change, and laws need to be strengthened. Law enforcement sanctions should be more comprehensive, sentencing should be stronger, fines made larger, assets seized, and violators within the healthcare system prohibited from engaging in future medical-related activities.

• The issue of terrorist groups raising funds through the manufacture and sale of counterfeit goods must be addressed in a comprehensive way. This includes better intergovernmental cooperation, stronger laws, improved technology, and greater consumer awareness.

• Regarding pharmaceutical supply-chain protection, most of the emphasis has been placed on package security, with a focus on electronic product codes such as radiofrequency identification (RFID) and two-dimensional (2D) bar-coding. Package security is an important step that will provide a level of security, but it does not ensure the authenticity of the product. This is especially true when the majority of prescription medicines are legitimately repackaged before they reach the patient.

The article concludes with various Q&A's with industry executives regarding their authentication technologies.

Securing Pharma Chain endorses all efforts and solutions to this deadly criminal act but acknowledges that authentication is the most effective way of combating fraudulent, adulterated and counterfeit medications within the pharmaceutical supply chain.

To read the entire Pharmaceutical Technology article, visit: http://pharmtech.findpharma.com/pharmtech/IT/Authentication-and-Pharmaceutical-Protection-An-In/ArticleStandard/Article/detail/685888?contextCategoryId=48560.

To learn more about pharmaceutical anti-counterfeiting technologies, visit: www.xstreamsystems.net.

Caution: The Rising Price of Fake Drugs

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: http://www.xstreamsystems.net/.

Eli Lilly: Efforts to Stop Counterfeit Medications

"The private sector must stand ready to partner with the public sector in tackling this problem."

Lilly Pad, a new corporate blog from Eli Lilly, posted a feature on September 13th written by Amy O’Connor regarding counterfeit medications.

Ms. O’Conner blogs about the Eli Lilly perspective on counterfeiting and cites some of the recent articles in the media regarding this deadly act.

Highlighted in the blog:

• A common misperception is that counterfeits and generics are the same thing. The counterfeiters can make significant profits from generics, and in some cases more profit if there is a higher volume of demand. To categorize them as such is unfair to the world’s generic drug producers. Legitimate products, either branded or generic, must go through stringent regulatory approval processes before going on the market. In most countries, both generic and branded drug makers are bound by Good Manufacturing Practices (GMPs) that are designed to ensure product potency, safety and efficacy.

• Lilly remains committed to patient safety in the face of this growing problem. Our company has initiated a broad range of actions to aggressively protect our patients against the exploitative actions of criminal counterfeiters. This includes the addition of enhanced Anti-Counterfeiting technologies for Lilly products and packaging in our retail product portfolio, and changes in our distribution system.

• We actively partner with government, non-government organizations, and trade associations to strengthen, enact, and enforce Anti-Counterfeiting laws, and to raise awareness among governments and with patients. The private sector must stand ready to partner with the public sector in tackling this problem. However, without more rigorous international cooperation to improve regulations, laws and penalties related to counterfeiting medicines and also enforce them, the consequences for worldwide patient safety will be serious.

Secure Pharma Chain endorses Eli Lilly’s continued commitment to combating this deadly global epidemic and encourages other members of the pharmaceutical supply chain (manufacturers, distributors and dispensers) to deploy technologies and solutions to protect their brands and consumers.

Secure Pharma Chain also welcomes Lilly Pad to the world of corporate blogs and looks forward to following and reading its contributions and insights.

To read the Lilly Pad blog, visit: http://lillypad.lilly.com/public-policy/efforts-to-stop-counterfeit-medications.

To learn about anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

Freightwatch International: August 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 August 2010.

FreightWatch recorded 58 cargo theft incidents in August; an 18% increase from the thefts recorded in July.

The states with the highest number of thefts were California and Florida, while Georgia experienced a higher number of incidents compared to last month displacing Texas to fourth place on the list of cargo theft.

By commodity, pharmaceuticals had three reported incidents in August:

• August 2nd in Columbus, Ohio there was a theft of a trailer with an undisclosed value.

• August 2nd in Philadelphia, Pennsylvania there was a theft of a trailer with cargo valued at $85,000 from a secured distribution center/lot.

• August 17th in Detroit, Michigan there was a theft of a cargo van from a secured location with an undisclosed value.

During the last months there has been an increase in the number of secure yards being targeted. In August, this trend continued to grow as the majority of the incidents recorded occurred at secure terminal lots followed by truck stops.

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:

http://www.freightwatchintl.com/.

To learn more about pharmaceutical material screening technologies, visit: http://www.xstreamsystems.net/.

Washington Post: India Becomes a Hub for Fake Medicines

India, the world's largest manufacturer of generic drugs, has become a busy center for counterfeit and substandard medicines.

Rama Lakshmi, in the September 11th issue of the Washington Post writes and outstanding expose regarding the state of the pharmaceutical supply chain in India.

Beyond the borders of India, this has become a significant concern given that India is the world’s largest producer of generic drugs and now has the dubious distinction as the largest exporter of counterfeit drugs around the globe.

India currently legitimately exports $8.5 billion of pharmaceuticals, mostly to African and Latin American countries, each year.

Lakshmi does an excellent job in personalizing the Indian counterfeit drug problem with stories of locals fighting and participating in the illicit trade, along with macro industry insight.

Highlighted in the Washington Post article:

• India, the world's largest manufacturer of generic drugs, has become a busy center for counterfeit and substandard medicines. Stuffed in slick packaging and often labeled with the names of such legitimate companies as GlaxoSmithKline, Pfizer and Novartis, the fake drugs are passed off to Indian consumers and sold in developing nations around the world.

• An expert says the global fake-drug industry, worth about $90 billion, causes the deaths of almost 1 million people a year and is contributing to a rise in drug resistance.

• Estimates vary on the number of these drugs made in India. The Indian government says that 0.4 percent of the country's drugs are counterfeit and that substandard drugs account for about 8 percent. But independent estimates range from 12 to 25 percent.

• Indian officials say the clandestine industry has hurt the image of India's booming pharmaceutical industry and its exports.

• The number of people arrested for manufacturing and selling fake drugs rose from 12 in 2006 to 147 last year, and drugs worth about $6.5 million were seized over this period.

• The tricks of the trade include sticking fraudulent labels on expired products, filling vials with water, stuffing small amounts of real ingredients in packages of popular licensed brands and putting chalk power in medicine packets.

• In June, officials at Nigeria's Abuja airport caught a shipment of fake antibiotics, containing no active ingredients, with a "Made in India" label. Nigerian investigators later said that a Chinese company shipped the drugs via Frankfurt. In a similar incident last year, a shipment of fake anti-malaria drugs from China arrived in Nigeria with an Indian tag.

• Last year, Sri Lanka banned imports from four Indian companies after officials discovered substandard medicine in shipments.

• Over the years, drug companies have used holograms or embossed their logo on the packaging to protect their brands, but these have also been counterfeited in India.

• Co-writing a report on a recent survey, Barun Mitra, Director of the New Delhi-based think tank Liberty Institute said that 12 percent of sampled drugs from the capital's pharmacies were substandard. "We are behaving like ostriches with our heads in the sand and pretending that nothing is amiss even as the problem keeps growing and affecting Indian patients."

Lakshmi ends the piece with a story about an encounter with a local drug counterfeiter:

On a recent morning in the northern city of Varanasi, a young man named Ashish waited for a shipment of painkillers and postpartum pills to arrive by train.

He said his order of pills that controlled postpartum bleeding contained chalk powder but came with the brand name Methergine in a Novartis package.

The painkiller had insufficient ingredients and carried a Bidanzen Forte label inside a knockoff GlaxoSmithKline package.

"There is a lot of profit in this," said Ashish, 28, describing the extent of counterfeit drugs in Varanasi. He declined to give his surname because his operation is illegal.

"I do not think about right or wrong," he said. "I am not killing anybody. The worst is that these medicines will not show any result and the patient may have to check into a hospital."

In a growing global supply chain and with India's pivotal role in it, it is imperative that the regulatory and the individual members of the pharmaceutical supply chain's become proactive in dealing with drug counterfeiting a criminal act that impacts the health and well being of millions all over the globe.

As this story illustrates, because of their sophistication, drug counterfeiters can easily adapt to packaging centered anti-counterfeiting solutions, what they cannot do is account for authentication of the product while it is in its packaging.

Verification of the product inside its sealed container is the most effective way of protecting the supply chain and the consumer from this deadly crime.

To read the entire Washington Post story, visit: http://www.washingtonpost.com/wp-dyn/content/article/2010/09/10/AR2010091006700.html.

To learn more about authentication, anti-counterfeiting technologies, visit: http://www.xstreamsytems.net/

USA Today: Growing Problem of Fake Drugs Hurting Patients, Companies

Counterfeit drugs made in Asia and other emerging markets are a growing problem that's endangering consumers' health and chipping away at drug companies' profits.

Kathy Chu in the Monday, September 13th issue of the USA Today writes an excellent story regarding the growing problem of counterfeit drugs globally. Ms. Chu cites some fresh industry statistics and pharmaceutical security insiders in her piece.

Here are some of the highlights from Ms. Chu’s USA Today article:

• Last year, nearly 1,700 incidents of counterfeit drugs were reported worldwide, triple the number in 2004, says the Pharmaceutical Security Institute (PSI), a group funded by drugmakers. Estimates for the size of the counterfeit drug market range from $75 billion to $200 billion a year. The market is likely much bigger because many cases are hard to detect.

• Fake drugs are a "money machine" whose sales are growing at twice the rate of legitimate pharmaceuticals, says Peter Pitts, president of the Center for Medicine in the Public Interest.

• A weak economy along with rising drug prices are likely leading consumers to seek out cheaper products online or from unauthorized providers, stoking demand for counterfeit drugs, says Bryan Liang, a board member at the Partnership for Safe Medicines. More than 50% of the medicine bought from certain illegal websites has been found to be fake, according to the World Health Organization.

• Scott Davis, a senior regional director in U.S. drug giant Pfizer’s global security division, believes it's not cheaper prices that drive consumers to counterfeit medicine, but their "lack of education and awareness of the dangers." Counterfeit medicine may include too much, too little or none of the ingredients found in the real product, causing injury and in extreme cases, death.

• Today, drug rings in Asia, particularly in China and India, are increasingly churning out fake versions of popular brands and generics, then selling them to consumers online or in the black market. PSI estimates that fake versions of about 800 pharmaceutical products were made last year.

• Counterfeiters are now able to fake drugs so well, even experts find it hard to distinguish the copies from the real deal. And they're able to replicate security devices such as holograms only a few months after pharmaceutical companies put these features on their packages.

• "You can make more money in counterfeit drugs than heroin," says Tom Kubic, CEO of PSI. "There's a major financial incentive for criminals because of the low risk of detection and prosecution."

• In many countries, penalties on fake drugmakers aren't strong enough to deter their illicit activities, says Lembit Rägo, coordinator for medicines quality and safety at the WHO. Countries including China, however, have stepped up their efforts related to detection and seizure of counterfeit drugs.

• Fake drugs also put pharmaceutical makers' profits at risk by diverting consumers away from the legitimate products, Liang says. While counterfeit drugs are more common in emerging economies, they also pose a threat to consumers in developed countries, such as the U.S., who are buying medicine online. "When the patient gets away from trusted sources, that's where I see the problem in the developed world," Davis says.

Huge profits, sophisticated criminals along with lax regulatory and legal penalties, make this the “perfect crime” that impacts the health and well being of entire populations often with deadly consequences.

This epidemic goes well beyond the unsophisticated supply chains of undeveloped nations, consumers all over the globe are unwittingly victims of this deadly act.

Pointed out in the article is the criminals ability to react to covert packaging protections, which means that they can easily fool basic Track and Trace technologies which currently comprises the majority of technologies used in defeating counterfeiters.

Secure Pharma Chain endorses authentication, as the most effective way in defeating counterfeiters and verifying that the products and inventories within the supply chain are genuine and safe for consumers to take.

To read the entire USA Today story, visit: http://www.usatoday.com/money/industries/health/2010-09-12-asia-counterfeit-drugs_N.htm.

To learn more about pharmaceutical authentication technologies, visit: http://www.xstreamsystems.net/.

£1 million of Fake Viagra Tablets Seized at Heathrow Airport

UK Border Agency Officials announced Thursday that 180,000 fake Viagra tablets had been seized at Heathrow Airport over the last 3 months.

The Border Agency officials warned that the counterfeit erectile dysfunction tablets, which were worth more than £1 million were destined for the black market, contained "potentially harmful chemicals which were likely to have the desired effect."

Clearly these bogus drugs would have gone undetected by their victims until their overall health was negatively impacted. In most cases it seems likely that the victims or their health care provider would not have any idea as to the real cause of their decline.

These isolated seizures are not isolated incidents and demonstrate how prevalent this deadly crime has become in developed countries.

No population is safe from fake medications spreading poor health, disease and death.

Bogus drugs that go to the black market end up in the legitimate supply chain through a variety of sources because of the huge profits realized by the criminals.

We are now seeing trusted health care professionals becoming involved in this deadly trade, lured by the money and the lax regulatory enforcement.

It is imperative that all members of the pharmaceutical supply chain become proactive in deploying solutions and technologies to protect their inventories and consumers from these deadly medications. As this deadly issue accelerates into the developed world, those that make the investment now will save lives and profit from their foresight.

To learn more about anti-counterfeiting solutions, visit: http://www.xstreamsystems.net/.

Pharmalot: Killing Snakes with Bad Tylenol

Pharmalot has a great suggestion for the J&J CEO to turn the recent recalls into a win-win.

Ed Silverman in his September 8th blog titled, Snake in the Grass, J&J Can Recoup Tylenol Losses, has come up with a novel way to turn this bad situation by donating the recalled Tylenol to the U.S. military for “a perfectly good cause”.

Apparently the U.S. military has come up with a solution for their invasive brown tree snake problem at their naval base in Guam. They have discovered that snakes die when they consume acetaminophen. They now are proposing dropping mice fed with acetaminophen from a helicopter into the jungles surrounding the base…

As Mr. Silverman so eloquently elaborates:

Snakes, after all, do not care if their Tylenol smells musty or contains metallic flecks. Grind ‘em up, feed ‘em to the mice, drop the mice in the jungle and, voila, no snakes. And for Weldon, no embarrassing trips to the landfill.

“The discovery that snakes will die when they eat acetaminophen was a huge step forward,” Anne Brooke, conservation resources program manager for Naval Facilities Command Marianas, tells Stars and Stripes “The problem was how you get the snakes to eat it.”

Putting Guam aside for a moment, this could be the public relations coup that Weldon so desperately needs. Rather than sheepishly dispose of millions of Tylenol tabs in the middle of the night, he and his new quality control team can be photographed proudly donating the poorly made goods to an effort that serves vital US interests. And best of all - J&J may be able to realize a tax break in the process. How’s that for leadership possibilities?

I guess if you are the CEO of J&J you have to take the lampooning when under your watch, your company so thoroughly botches quality control and the subsequent attempt to cover its tracks from the consumer and the government.

Clearly the entire situation is a cautionary tale for the entire supply chain. Thankfully for all, the only fatalities to this recall, other than some careers and stock portfolios, will be to the population of the brown tree snake in Guam.

To read the Pharmalot post, visit: http://www.pharmalot.com/2010/09/snake-in-the-grass-jj-can-recoup-tylenol-losses/

To learn more about supply chain authentication solutions, visit: www.xstreamsystems.net.

Airlines Warned About Counterfeit Drugs

Aviation India a publication that services the Indian civil aviation industry is reporting that large consignments of fake Indian drugs manufactured in China are finding their way to Nigeria.

The Nigerian authorities are apparently warning airlines that they would be held responsible for spurious drugs carried by passengers flying into that country. The warning was issued by the NAFDAC following complaints from Indian pharmaceutical manufacturers.

Given the severe epidemic and deadly impact on the population due to counterfeit drugs necessitates the Nigerian Government taking extreme actions to thwart this deadly criminal act.

Hopefully commercial interests and industry will be part of the solution in eradicating this global blight.

To learn about pharmaceutical supply chain security technologies, visit: http://www.xstreamsystems.net/.

Pharmaceutical Security Institute: Global Seizures Chart

The Pharmaceutical Security Institute has released a graph showing global seizures of counterfeit, illegally diverted and stolen pharmaceuticals from 2002 to 2009.

Additionally PSI charted the seizures of illegal pharmaceuticals in 2009.

Both charts were published in the September 2 issue of The Economist.

The statistics are somewhat troubling to those in the know, especially given what most consider fragmented regulatory and law enforcement world wide. In many countries there is little consideration or resources allocated to dealing with the criminal act of adulterated, fraudulent and counterfeit medications. Which is unfortunate given its deadly consequences.

Secure Pharma Chain believes that the pharmaceutical supply chain and it members must lead the way by deploying solutions and technologies to secure the supply chain and authenticate inventories to protect their industry and most importantly the consumer.

To learn more about anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

Prominant U.S. Pharmacist Accused of Selling Fake Drugs

​A prominent Wisconsin pharmacist, who served on the University of Wisconsin Foundation and built a national reputation for helping women cope with PMS has been accused of shipping millions of fake doses of Viagra and other prescription medications.

Dr. Marla Ahlgrimm owner of Women’s Health America and her alleged partner Balbir Bhogal are purported to have imported pills from India with the identical coloring and markings of Viagra and other prescription drugs and selling them to an Internet pharmacy service among others.

Feds intercepted the drugs being shipped by an Internet pharmacy, which turned over its illegal Viagra, oxycodone and anti-anxiety meds. Tests determined the drugs, which were traced back to Ahlgrimm and Bhogal, contained either no medication or only tiny amounts.

When a trusted health care professional intentionally poisons the pharmaceutical supply chain with fraudulent, counterfeit medications, the only protection is in the members of the supply chain routinely verifying the safety and clinical efficacy of the product through authentication technologies.

Secure Pharma Chain encourages everyone within the pharmaceutical supply chain to deploy a variety of technologies, specifically authentication solutions to protect their inventories from fraudulent, adulterated and counterfeit medications.

Authentication solutions go beyond pedigree or track and trace solutions and verifies to the end user what is inside the box within their inventories.

Knowing where the box has been is important but knowing what is inside the box is critical.

To learn more about authentication solutions, visit: http://www.xstreamsystems.net/.

WSJ: Delhi's Fake Drug Whitewash

“The (Indian) government's flawed research study endangers lives and crucial pharmaceutical investment.”

Roger Bate, a Legatum Fellow at the American Enterprise Institute and one of Secure Pharma Chain’s favorite international pharmaceutical counterfeiting experts, once again writes an excellent opinion piece in the September 2nd issue of the Wall Street Journal.

Mr. Bate focuses a very critical eye on the Indian Governments Central Drugs Standard Control Organization’s study on spurious drugs within the Indian Supply Chain.

Mr. Bate challenges CDSCO’s sampling methods, the contradictions with past accepted issues and reports of pharmacies likely knowing of inspections in advance.

This is especially worrisome given the fact as Mr. Bate points out that 45% of a Indian’s pharmaceutical market is exported to more than 200 countries and that every second child in the world is vaccinated with a vaccine made in India.

Mr. Bate questions examines CDSCO’s testing and sampling protocols which ultimately he determines to be "a whitewash of a crucial problem".

Highlighted in the WSJ opinion piece:

· The proliferation of fake drugs is one of the greatest dangers facing India today. It threatens lives, discourages patients from using life-saving innovations and deters much-needed pharmaceutical investment. So it's more than a bit worrying to see the Indian government touting a new study that is little more than a whitewash of this crucial problem.

· After literally months of leaks about the results, the "Report on Countrywide Survey For Spurious Drugs" was released by the Central Drugs Standard Control Organization in July. The report, conducted over a period of seven months last year, found that of 24,136 samples, 11 or 0.045%, were fake.

· The CDSCO took pains to point out that their results flatly contradict reports over the past decade from scholars and industry groups claiming fake drug rates ranging from 3% to 35%. Indeed, the author expresses a clear aim to overcome the "apprehensions about the availability of safe and genuine medicines in India."

· But the report's results fail to pass even the most cursory of inspections. Not only are there discrepancies with international studies, but there are unexplained internal inconsistencies which undermine the findings. The report says, for instance, that its authors had no useful information about areas known for counterfeit drugs. This is inconceivable: New Delhi's Bhagirath Palace and certain markets in Agra and Aligarh are known to me, a foreigner, as major locations of the fake drugs trade.

· It's reasonable to assume the report generated untrustworthy findings because the samples were biased. Vijay Karan, a former Delhi police chief, told me that many pharmacists are routinely aware of when and by whom government surveys would be done. The report itself notes retail pharmacists in cities "refused to sale. . . the schedule drug without prescription." But of the 70 or more pharmacies in cities we visited in our studies at the American Enterprise Institute, none demanded prescriptions. Either pharmacists voluntarily and drastically changed policy in the past year—or they were alerted to who the covert buyers really were and reacted by following the letter of the law, not their usual practice.

· Conducting covert surveys requires following a careful protocol. In our peer-reviewed studies for the Public Library of Science One Journal, we were grilled by reviewers about how interviews were conducted, since poor sampling might have biased the results. Yet the CDSCO report includes only a single sentence on the importance of sampling protocols. Nowhere in the report is the drug-collection protocol actually discussed.

In the final analysis, the CDSCO report is a well-conducted analysis of probably dubious data, which makes the results useless. If this were a minor report, that might be a passable error. But given the life-threatening nature of fake drugs, it's not something the government should tolerate. A Pew poll last month found that 54% of Americans distrust drugs made in India. No wonder.

Mr. Bate’s critical analysis of the CDSCO survey is important in that it calls out those who are entrusted with a population's public safety who have fallen short of their responsibility of accurately summarizing this important issue.

Adulterated, fraudulent and counterfeit drugs are an international crime and a health care epidemic; a government that turns a blind eye and chooses to ignore the issue and proclaim a supply chain safe when common sense and history dictates otherwise invites deadly consequences.

Secure Pharma Chain encourages the pharmaceutical supply chain to protect itself by deploying technologies to protect their inventories and defend consumers from bogus, deadly medicines.

To read the entire Wall Street Journal Opinion, visit: http://online.wsj.com/article/SB10001424052748703882304575465170785077144.html

To learn more about anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

The Economist: Fake Drugs

Counterfeit drugs used to be a problem for poor countries. Now they threaten the rich world, too.

In the September 2nd edition of The Economist, they have an excellent piece on the issue of counterfeit drugs.

The Economist story focuses on updated statistics, industry insight, on how globally there is lax regulatory enforcement/punishment and how this deadly crime is impacting health care outside of the third world.

Highlighted in The Economist:

· Drug smugglers can expect harsh penalties nearly everywhere—if the drugs in question are heroin or cocaine. Those who smuggle counterfeit medicines, by contrast, have often faced lax enforcement and light punishment. Some governments deem drug-counterfeiting a trivial offence, little more than a common irritant.

· The pharmaceutical industry has persuaded several governments to stiffen regulations against fake drugs and to conduct more aggressive raids (see chart). Companies are also devising novel technologies to outfox the criminals. Even the Catholic church is joining the cause, issuing a stern statement in August that it is in “the best interest of all concerned that smuggling of counterfeit drugs be fought against”.

· Counterfeit drugs can kill. Studies of anti-infective treatments in Africa and South-East Asia have found that perhaps 15-30% are fakes. The UN estimates that roughly half of the anti-malarial drugs sold in Africa—worth some $438m a year—are counterfeits.

· Roger Bate of the American Enterprise Institute, a think-tank in Washington, DC, cautions that any such estimates should be treated with care. The countries with the most fakes may not be cracking down, so official figures will look rosy; in contrast, countries with a smaller counterfeit trade that are vigilant may end up with more seizures. The World Health Organization agrees, and has recently taken its estimates off its website. Even so, Mr Bate says his field work has convinced him that counterfeits kill at least 100,000 people a year, mostly in the poor world.

· Now it appears that fakes are taking off in the rich world too. Yes, Viagra still tops the list of knock-offs seen by Pfizer, says John Clark, the American drug firm’s global head of security; but fake versions of at least 20 of its products (including Lipitor, a blockbuster cholesterol drug) have been detected in the legitimate supply chains of at least 44 countries. Mr Clark’s intelligence comes from Pfizer’s global network of informants, consumer tip-offs and in-store inspections. He sees worrying trends.

· Counterfeiters used to operate chiefly in developing countries, says Mr Clark, but now his firm sees fakes coming from such rich and well-regulated places as Canada and Britain. And the crooks are growing more technologically sophisticated: some can even counterfeit the holograms on packets that are meant to reassure customers that pills are genuine.

· A consumer study funded by Pfizer recently found that nearly a fifth of Europeans polled in 14 countries had obtained medicines through illicit channels. That, the firm reckons, makes for a grey market in the EU of over €10 billion ($12.8 billion). Terry Hisey of Deloitte, a consultancy, thinks the global market for fakes could be worth between $75 billion and $200 billion a year. Those staggering sums, he argues, help explain the emergence of a flurry of new technologies and companies hoping to help the drugs industry “secure its global supply chain”.

The Economist outlines several technologies used in the fight against counterfeit drugs but comments:

· Thomas Kubic of the Pharmaceutical Security Institute, an industry-funded outfit, gives warning that this war will be hard to win. After more than 30 years as an investigator, he is sure that crooks will eventually find a way around any defence.

· Even so, he thinks novel approaches such as mobile-based validation may “harden the target”, just as a burglar alarm makes your home somewhat trickier to rob. If the cost and complexity of faking drugs goes up, crooks may choose to fake Gucci handbags instead. This would still be theft, not to mention a crime against fashion. But it will not kill anyone.

Secure Pharma Chain endorses the concept of a multiple layered approach of deploying technologies to protect the global supply chain.

As this article points out the professional counterfeiter can fake nearly all overt methods of labeling or tracking the packaging which is why Secure Pharma Chain thinks that authentication, the actual testing of the material inside the container should be the centerpiece of a robust, layered approach to make certain that the medications are genuine.

Authentication technologies have advanced to the point that they can verify products inside their sealed container without destroying the packaging or degrading the contents.

Knowing what is inside the box is crucial in protecting consumers from this deadly criminal act.

To read the entire, excellent article, visit: http://www.economist.com/node/16943895?story_id=16943895&fsrc=scn/tw/te/rss/pe.

To learn more about authentication anti-counterfeiting technologies, visit: http://www.xstreamsystems.net/.

2010 Pain in the (Supply) Chain Survey

As the Secure Pharma Chain team takes a breather during the Labor Day Holiday, the following is a re-post of a blog from June regarding UPS' study on supply chain issues.

Findings show the industry’s greatest pain points and reveal companies’ plans for the year ahead and beyond. Product Security continues its rise in significance to industry leadership.

UPS, a leading provider of healthcare logistics and transportation services, launched its third annual “Pain in the (Supply) Chain” survey. The survey taken by healthcare supply chain executives, measures concerns about business and supply chain issues in the wake of healthcare reform and other industry changes.

The Survey was conducted by Harris Interactive on behalf of UPS and consisted of blind, in-depth telephone interviews with senior-level decision makers at nearly 150 pharmaceutical, biotech and medical/surgical device companies. All of the survey respondents were responsible for supply chain and logistics at their company.

The “Pain” study is an excellent resource as it relates to the most relevant trends and thoughts of the healthcare industry leadership.

The survey key findings are organized by nine key trend areas including Product Security concerns.

Regarding Product Security, the 2010 survey found the following:

• In the nine key trend areas, Product Security is tied with Access to Global or Emerging Markets.

• Product Security ranks as the third largest supply chain issue following Managing Costs and Regulatory Compliance.

• Product Security ranks as the second largest barrier to global expansion.

• 40% of industry respondents are highly concerned about product security, specifically their concerns are:

o 69% cite attempts to counterfeit products

o 60% name product theft as a top challenge

o 53% worry about product diversion

o 50% name theft in transit as a key challenge

The survey confirms the trend that industry leadership is beginning to understand the relevance of the criminal acts, namely theft, fraud, adulteration and counterfeiting impacting product security within the various healthcare supply chains.

Secure Pharma Chain Blog encourages both industry leadership and regulatory agencies to deploy advanced technologies and solutions to combat the various product security challenges cited in the survey.

To view the UPS survey, visit: http://www.ups.com/.

Sun Pharma And Its Incredible, Imploding Bottles

Ed Silverman in Pharmalot, blogs about an unusual and severe case of a company suffering from poor GMP and quality control due to overseas manufacturing...
imploding bottles of pills.

As usual Silverman’s excellent blog enlightens by stating:

How’s this for unusual? Over the course of a three-month inspection earlier this year, FDA inspectors found something interesting at the Sun Pharmaceuticals plant in Cranbury, New Jersey - imploding bottles. The spectacle prompted the agency to issue an Aug. 25 warning letter to the Indian drugmaker that its facility is, essentially, out of control and, therefore, violating good manufacturing practices.

To wit, the FDA noted that Sun Pharma was aware last September that bottles of Gemfibrozil tablets, which are used to regulate cholesterol and triglycerides, were imploding in its sample room, but did nothing about the problem until the agency showed up this past March. There was no field alert issued. There was no recall until March of this year. And there was no explanation as to why Sun failed to investigate until the FDA arrived.

Apparently the drugs are manufactured overseas and clearly Sun Pharmaceuticals has a significant quality control issue. Not to mention an issue with the dispensers and consumers that have this product on their shelf.

It is especially troubling that Sun Pharmaceuticals seemed aware of this issue but did little to correct it or warn its trading partners and the consumer of the potential danger of the product.

This again is a cautionary tale of those within the pharmaceutical supply chain needing to protect their business and the consumer by authenticating and verifying their inventories at all stops.

Clearly no one wants to be the person that ingests this product.

To read the entire Pharmalot blog, visit: http://www.pharmalot.com/.

To learn more about pharmaceutical authentication solutions, visit: http://www.xstreamsystems.net/.

A Tale of Smuggled Prescription Drugs

Courthouse News in its August 25th edition reports on the story of a Drug Wholesaler suing its former employee and several of his companies.

According to the report, the owner of AQ Pharmaceuticals claims his compliance officer who bought "illegally diverted" Lipitor and Celebrex, which had been smuggled into the United States, and sold the drugs to AQ, causing the company to resell them, unknowingly, to a network of independent pharmacies. Both men - plaintiff and defendant - faced felony conspiracy charges for the ruse, according to the federal complaint.

The owner of AQ Pharmaceuticals and the defendant where indicted on federal charges of felony conspiracy as a result of the diverted product.

Highlighted in the Courthouse News story:

· Trang Nguyen, owner of AQ Pharmaceuticals, sued his former compliance officer, James Floyd, and Floyd's companies, Pharmaceutical Medical Supply and Direct Pharmaceutical.

· Trang claims he "submitted purchase orders to defendants for lawful and compliant supply of Lipitor and Celebrex, for the purpose of lawful resale in the United States," and the defendants sent him "diverted Lipitor tablets and Celebrex capsules manufactured by Pfizer that were not intended or approved for sale in the United States due to its illegal importation and smuggling into the United States."

· Trang claims that Floyd "misrepresented the status of the Lipitor and Celebrex as legal for sale in the United States, despite his duty and responsibility as a compliance officer of AQP." Trang claims he had "no knowledge of the illegal nature of the diverted" drugs.

· He claims that Floyd and Stanley then made "false oral and written representation to True Care Pharmacy regarding the ownership of AQP" to facilitate the sale of the diverted drugs. True Care is a network of independent pharmacies, which bought "quantities" of the diverted drugs.

· As a result of all this, Trang says, he, Floyd and others were indicted on federal charges of felony conspiracy to defraud the United States, in 2007 in the Western District of Missouri. He claims that Floyd told him throughout that the charges were "erroneous," but pleaded guilty in 2008 and was sentenced in March 2009.

· Trang claims he and AQ were ignorant of the nature of the diversion until after Floyd was sentenced. He says felony charges against him were dismissed, but he had to plead guilty to misdemeanor misbranding, and had to pay $597,420 in restitution to Pfizer. The litigation cost him more than $1 million.

Clearly this incident and its circumstances are a cautionary tale. Pharmaceutical supply chain members need to understand that pedigrees of products within their inventories can be as fraudulent and counterfeited as the products that they represent.

Regulators and consumers must understand that track and trace solutions do not adequately protect the supply chain.

Members of the supply chain need to go beyond transactional records to verify their inventories. Fortunately in this incident, the material was genuine and its only victims suffered commercially and the perpetrators were jailed.

Authentication and verification are critical for the members of the supply chain to make certain that the products within their inventories are safe and efficacious for the consumer.


To read the Courthouse News story, visit: http://www.courthousenews.com/2010/08/25/29854.htm.

To learn more about pharmaceutical supply chain authentication technologies, visit: http://www.xstreamsystems.net/.