WSJ: House Committee Investigation Faults FDA for Not Pursuing Heparin Contamination Leads

An April 30th Wall Street Journal article reports that the House Energy and Commerce Committee investigated and faulted the Food and Drug Administration for not pursuing “particular and plausible leads which could have fingered those responsible in China for playing a role in the contaminated heparin crisis two years ago.”

House members, Joe Barton (R-TX) and Mike Burgess (R-TX) sent a letter to the FDA in which they spelled out findings from the investigation, and said that the FDA has not pressed the government of China regarding Chinese companies involved.

Secure Pharma Chain Blog, recommends that all members of the supply chain protect their inventories and their brand by deploying authentication and material verification that will interdict issues with adulteration, fraud, counterfeit and improper manufacturing that threaten the efficacy of pharmaceuticals and the health of consumers downstream.

In the past several years, manufacturing concerns by foreign pharmaceutical companies have been discovered within the supply chain that could have been detected at various points of the supply chain by readily available material authentication solutions.

To read the entire Wall Street Journal article, visit: http://online.wsj.com/article/SB10001424052748703572504575214420823549694.html

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

RFID is Dead...

RFID is Dead…at Unit Level in Pharma or so says Dirk Rodgers, an industry veteran and active blogger.

Supported by excellent data, Mr. Rodgers in his opinion blog RxTrace.com posted a very good op/ed regarding RFID and its place within the pharmaceutical supply chain.

RFID technology originally developed as an inventory management tool was considered the panacea to the issue of fraudulent, adulterated and counterfeit medications by many industry insiders but their implementation and use as a solution has fallen short.

Bogus medications have now proliferated into a $75 billion annual worldwide criminal activity as the pharmaceutical supply chain has become more global.

In Mr. Rodgers' piece, he gives the historical perspective, graphs on costs, supply chain perspectives and insight into the reason that RFID has failed and will continue to fail as the ultimate solution within the supply chain.

Mr. Rodgers' concludes that RFID still has a place for use in bulk/case containers but feels that barcodes on individual units will ultimately become the norm because of costs.

Secure Pharma Chain Blog agrees in essence with Mr. Rodgers' case regarding RFID and barcodes. Ultimately we believe that tags, barcodes and other track and trace technologies are effective in what they do and that they are an import part but not the definitive solution to solving the issue of fraudulent, adulterated and counterfeit medications. Unfortunately these technologies only tell you information on the transaction and packaging.

What is most important in supply chain security is what is inside the box.

Secure Pharma Chain Blog believes in a multiple layered approach that includes transactional tracing but ultimately relies on material identification of the product to authenticate the product as it migrates throughout the supply chain.

To read Mr. Rodgers' entire blog, visit: http://www.rxtrace.com/2010/04/rfid-is-dead-at-unit-level-in-pharma.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+rxtrace%2Fvqly+%28RxTrace%29.

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

Canadian Gold Medal Paralympian Arrested for Counterfeit Drugs

The Globe and Mail are reporting on a story of the Gold Medal Skip or Captain of the 2010 Canadian Paralympics Curling Team being arrested in the United States on charges of trafficking in counterfeit drugs.

According to Washington State court records, Jim Armstrong of Richmond, BC was arrested in Blaine, Washington while trying to pick up a package of thousands of counterfeit Viagra and Cialis pills.

The court complaint, filed April 16, said Mr. Armstrong “caused the introduction into interstate commerce of a misbranded drug with intent to mislead or defraud.” It also alleges he was involved in the trafficking of these counterfeit drugs.

The issue of counterfeit drugs, its almost mainstream criminal activity and the threat to the healthcare of consumers worldwide encourages the need of all within the pharmaceutical supply chain to deploy solutions and technologies to combat this potentially deadly crime.

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

To read the entire Globe and Mail story, visit: http://www.theglobeandmail.com/news/national/british-columbia/paralympic-curling-skip-arrested-in-us-over-counterfeit-drugs/article1542641/

German Customs and the Economics of Pharmaceutical Counterfeiting

In an excellent piece by Phil Taylor in SecuringPharma.com he writes about an international operation headed by customs officers in Germany that is attempting to disrupt the trade in counterfeit medicines focusing primarily sales via the Internet.

According to the story this effort,” has notched up some notable successes in its first 18 months”.

The operation named Project Blue is specifically targeted at the illegal trade in pharmaceuticals and is being conducted by a 12-member team from German Customs, under the leadership of Sieghart Vosseler.

The highlights on Project Blue are:

· "The cooperation of the financial sector made this a unique operation, and was a major contributory factor towards the success of Project Blue," said Vosseler, who heads the Organized Crime Investigations unit at German Customs.
· Few people are aware of the hugely complicated network that is operating when they make a purchase using a credit card, and particularly the fact that the likes of Visa and MasterCard never actually touch the money that changes hands.
· "The credit card companies provide the network for payment, but the actual money is handled by independent companies known as acquirers," said Vosseler. He cited a case last May in which a German Internet pharmacy was raided and a large quantity of fake medicines were seized, including products mimicking Pfizer's erectile dysfunction product Viagra (sildenafil citrate). The ringleader of the operation was in fact a career criminal - a burglar - who had decided to swap over to counterfeit medicines as the risks were low and the rewards high. The Project Blue taskforce were able to follow the financial transactions of the ring - which involved shifting large quantities of money (around €3m) through seven separate countries, and freeze their bank accounts.
· A total of seven arrests were made in the operation, which resulted in the seizure of more than 172,000 medicine units and nearly €390,000 in cash, as well as the confiscation of around €700,000-worth of assets such as cars and property.

The most notable highlight of the story, aside from the specifics on Project Blue are the explanation from the German customs official, Mr. Vosseler, regarding the economics of pharmaceutical counterfeiting which is what makes it so financially attractive and driving its proliferation:

· "There is a lot of money in counterfeit medicines," commented Vosseler, at a recent IQPC conference in Amsterdam, the Netherlands.
· He cited a study carried out at the University of Bonn which looked at the profit which can be made when a criminal invests a €1,000 stake in counterfeit goods. For counterfeit money the return would be around €3,000 (on an investment of €1,000), rising to a little under €7,000 for a fake credit card (on an investment of €1,000). Counterfeiting software gives an even better return at around €100,000 profit (on an investment of €1,000), but all are eclipsed by fake pharmaceuticals with a whopping €500,000 return (on an investment of €1,000).

The story provides excellent insight into the international fight that pharmaceutical counterfeiting has become and the huge financial gains that is driving it.

Secure Pharma Chain Blog continues to highlight medication counterfeiting as one of the most dangerous forms of this criminal activity and encourages all within the pharmaceutical supply chains to deploy a variety of solutions and technologies in their efforts to protect the healthcare of the consumer.

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

To read the entire SecuringPharma.com story, visit: http://www.securingpharma.com/40/articles/455.php.

Taiwan’s Premier Stresses Determination to Fight Counterfeit Drugs

Focus Taiwan reported on statements from Taiwan’s Premier Wu Den-yih on April 15th regarding strengthening the crackdowns on counterfeit drugs and underground radio stations. Premier Wu stated that the recent actions were not meant to suppress freedom of speech or hurt the pharmaceutical industry, but to protect the public's health.

According to Focus Taiwan:

· Underground radio stations in Taiwan sometimes broadcast advertisements for fake or substandard medicine, and the premier issued a directive earlier this year asking authorities to report to him every week from April 1 on the progress of their crackdowns.
· From Jan. 1 to April 14, police discovered 65 cases involving the sale of unlicensed drugs and arrested eight suspects.
· Taiwan’s Department of Health (DOH) reported that from April 1 to April 13, local public health bureaus uncovered nine cases involving the possession of unlicensed medicine and handed out 13 fines. The bureaus also administered sanctions for 323 cases involving the illegal advertising of counterfeit medications and food products.
· Wu reiterated that it is the government's responsibility to eradicate the sale of unlicensed drugs and that every department should continue to work diligently toward that goal.

Secure Pharma Chain Blog continues to highlight medication counterfeiting as one of the most dangerous forms of this criminal activity and encourages all within the pharmaceutical supply chains to deploy a variety of solutions and technologies in their efforts to protect the healthcare of the consumer.

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

To read about the Focus Taiwan story, visit: http://focustaiwan.tw/ShowNews/WebNews_Detail.aspx?Type=aALL&ID=201004150019.

Smash and Grab Raid at Pharmaceutical Warehouse

Phil Taylor in a piece in SecuringPharma.com reports on a smash and grab raid of a pharmaceutical warehouse in British Columbia.

The Pharmaceutical Cargo Security Consortium has reported another pharmaceutical warehouse burglary at a wholesaler in Richmond, British Columbia, Canada.

The incident occurred on April 15 and resulted in the loss of around $40,000-worth of inventory, says the PCSC, which warned recently of an upsurge in suspicious activity around pharmaceutical facilities in the wake of the $76m raid on Eli Lilly's distribution facility in Enfield, Connecticut.

According to the report from PCSC, on April 15th, five individuals broke into the wholesaler’s warehouse lobby in a smash-and-grab raid in which they attacked the warehouse, cage and vault.

To read the SecuringPharma.com story online, visit: http://www.securingpharma.com/40/articles/451.php.

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

The Economist: The Spread of Counterfeiting, Knock-offs Catch On

Fake goods are proliferating, to the dismay of companies and governments, reports The Economist in a story that appeared in their March 4, 2010 edition.

The piece details the overall impact of counterfeiting in all marketplaces, its spread and impact to economies and consumers.

The impact of counterfeits hits everywhere, according to the article, “fake Porches and Ferraris zoom along the streets of China. A German bank has discovered an ersatz gold ingot made of tungsten in its reserves…NASA, America’s space agency, has even bought suspect materials.”

This story encapsulates how prevalent this criminal activity has become and that it not just a victimless crime of a bunch of knock-off purses or watches sold on the street corner.

Highlights of the article include:

· The OECD estimates that the international trade in counterfeit and pirated goods was worth around $250 billion in 2007. The International Anti-Counterfeiting Coalition (IACC), a lobby group, says the true figure is actually closer to $600 billion, because the OECD’s estimate does not include online piracy or counterfeits that are sold in the same country as they are made. Counterfeit goods make up 5-7% of world trade, according to the IACC.

· Several factors have contributed to the growth of counterfeiting in recent years. The shift of much of the world’s manufacturing to countries with poor protection of intellectual property has provided both the technology and the opportunity to make knock-offs. The internet in general and e-commerce sites like eBay in particular, have made it easier to distribute counterfeit goods. MarkMonitor, a firm that helps companies defend brands online, estimates that sales of counterfeit goods via the internet will reach $135 billion this year.

· The recession in the rich world may also have given a boost to counterfeit goods. Frederick Mostert of the Authentics Foundation, an anti-counterfeiting group, has noticed a “spike” in knock-offs this recession, as consumers short of money trade down from the real thing. Cost-cutting measures may also have made firms’ supply chains more vulnerable to counterfeit parts.

· Governments are also boosting their efforts to crack down on counterfeiting, which deprive them of tax revenue in addition to harming legitimate businesses. Counterfeiting and piracy cost G20 economies €62 billion ($85 billion) a year in lost taxes and higher spending on unemployment benefits, according to a study by Frontier Economics, a consultancy. For every dollar invested in the fight against counterfeiting in America, the government receives $5 in extra tax revenue, estimates the US Chamber of Commerce, a business lobby.

· In 2008 the value of fake goods seized at America’s borders increased by nearly 40% over the year before. It subsequently fell by 4% last year—far less than the 25% decline in imports overall. In Europe in 2008 customs services confiscated more than double the previous year’s haul of counterfeit goods.

· MarkMonitor raised the price of its online brand-protection service by 18% last year because demand was so high. America’s biggest firms spend $2m-4m a year to combat counterfeiting on average—a figure that is growing along with internet shopping.

· In China, where 80% of the world’s fake goods are thought to be produced, officials are loth to crack down on a thriving local business.

Secure Pharma Chain Blog continues to highlight medication counterfeiting as one of the most dangerous forms of this criminal activity and encourages all within the pharmaceutical supply chains to deploy a variety of solutions and technologies in their efforts to protect the healthcare of the consumer.

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

To read this excellent article which appeared in the March 4th edition of The Economist, visit: http://www.economist.com/.