Tuesday, September 14, 2010

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/.

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