Chain of Custody Dilemma: Recovering Stolen Pharma Products

By: Alan Clock, Senior Vice President, XStream Systems

What happens to pharmaceutical products that are recovered intact, meaning in their original packaging or shipping containers, following a theft or high jacking?

According to most experts, the policy of Pharma companies is to destroy these recovered products because they have broken the chain of custody or transaction. The logic is that no one wants to assume the liability of the efficacy of the products because they are uncertain if the products were affected or somehow altered during their time spent outside of legitimate charge.

This is an obviously an expensive and wasteful expense especially if there is a technology available that would allow the supply chain to test these products, within their sealed, unit-of-sale container. A technology that will verify that the material inside is safe and has not been altered, tampered or somehow counterfeited without destroying or degrading the drug.

Recent statistics are showing a significant surge in criminal organizations targeting Pharma products within the pharmaceutical supply chain (manufacturer, distributor, dispenser and consumer). These groups are stealing large shipments; in transit to sell within gray or black markets for significant profits. Fortunately as the problem escalates, law enforcement and security often are recovering or interdicting these criminal acts quickly.

The following are some recent examples:

- Polish police have recovered eleven tons of human blood plasma that had been stolen at a truck rest stop in Germany while in transit to Austria. The owner of the plasma, BioLife Plasma Services, a subsidiary of Baxter International, valued the shipment at around $1.4m. All of the product had been recovered in its original boxes and packaging.

- Police recovered intact a shipment of Alcon Labs and Teva Pharmaceutical products, stolen on February 22. The value of the shipment has not been disclosed but included 70 pallets of assorted prescription, over-the-counter and personal healthcare products.

- A pharmaceutical shipment including products valued at over $500,000 belonging to Sanofi-Aventis was hijacked in Puerto Rico on January 29. A wide range of prescription medicines and vaccines was taken in the incident.

- AstraZeneca lost in transit, a FedEx shipment in late December/early January. The total value of the shipment, which included Casodex, Seroquel, Nexium, Toprol XL and Crestor and Zomig was in excess of $500,000.

As it stands today, even with the product recovered intact and within its original containers the product will be slated for destruction because of the lost chain of custody. However there is a readily available technology solution.

The most effective way to effectively know that the lost chain of custody has not impacted the quality, efficacy or somehow adulterated the stolen medications is to look inside the sealed container to screen, verify and authenticate the product inside the package.

An ideal solution, it allows packaged drugs to remain intact and is readily available to test products once they are retrieved. This technology provides a level of confidence that the temporary loss of chain of custody has not altered the product and that public safety is ensured.

XStream System’s technology solution is the ideal solution for the pharmaceutical industry's chain of custody challenge by using Energy Dispersive X-Ray Diffraction (EDXRD). This innovative technology allows the user to molecularly screen the product inside its original container without destroying or degrading the product.

This solution transforms the process from looking at the chain of custody and/or transaction to looking inside the packaging with Molecular Screening. Ultimately, this truly provides all of the members of the supply chain, from manufacturer to consumer, the confidence to know that the medications in their inventories or supply chain are safe and efficacious.

EDXRD solutions function by matching the diffraction pattern obtained by the instrument with a library of patterns previously obtained for comparison. The EDXRD diffracted spectral patterns of crystalline substances are markedly different, even to an untrained eye. Much like a human fingerprint, although there may be a few features that are common to both patterns, they are nonetheless very different. In current iterations of the technology, which is fitted with a computer-based detection device, the system relies on a sophisticated mathematical algorithm to extract a unique feature set from the pattern and use them to identify the material giving rise to that pattern.

In general, the EDXRD methods are highly material specific, since the diffraction patterns of crystalline materials are unique. As it relates to pharmaceuticals, the signature of diffracted aspirin is very different from ibuprofen, acetaminophen, codeine, etc. Equally important is the fact that the diffracted patterns of the excipients specific to the unique recipe of the formulation are unique and one can determine differences in manufacturer, packaging, dosage, etc. For example, acetaminophen, 325mg from one vendor, will differ from acetaminophen 325mg from another vendor unless they follow the exact same recipe, density, pill configuration and utilize the exact same packaging.

This material sensitivity of EDXRD has two important ramifications - high detection/verification rates and low false alarm rates. Under ideal conditions (i.e. - low absorption and high test mass), the detection rate is close to 100% and the false alarm rate is 0.1% or lower. In addition because it uses X-Ray, EDXRD technology can penetrate through nearly all plastics, cardboard, wood and metals in order to screen the material.

XStream Systems has succeeded in establishing EDXRD as a robust Molecular Screening tool that can be used within the supply chain. XStream has conceptualized and architected the world’s first countertop EDXRD machine, the XT250 Material Identification System.

The XT250 has turned a complex technology into an easy to operate solution for the average end user. The XT250 system is now fully deployed in drug wholesalers, pharmaceutical manufacturers and pharmaceutical reverse logistics companies. The system is designed to be used either in a standalone or integrated capacity anywhere along the supply chain; the deployment can be in a warehouse setting and operated by a non-technical warehouse worker.

With the XT250, there no longer needs to be the very expensive and wasteful dilemma of product destruction because the product has lost its chain of custody. Because the XT250 can authenticate products non-destructively, will no longer be incumbent on the supply chain to absorb multi-million dollar losses as the threat of cargo theft proliferates.

To learn more about XStream Systems, material identification solutions, visit: http://www.xstreamsystems.net/.

Freightwatch International: January 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 January 2010.

According to Freightwatch, following on the month of December 2009 where there were over 82 reported cargo thefts, the month of January recorded 64 reported cargo thefts.

By commodity FreightWatch recorded four thefts in the pharmaceutical sector.

The reported pharmaceutical thefts were a January 19th incident in Springfield, Michigan where over $500,000 of pharmaceuticals was stolen from a secured terminal lot. Two separate incidents in Colton, California that occurred on January 16th and the 19th involving an unknown value of pharmaceuticals. And a January 28th theft of pharmaceuticals in Newtown City, Illinois where an unknown amount of pharmaceutical products were stolen from a public access parking lot.

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.

To read the entire report from Freightwatch International, visit: http://www.freightwatchintl.com/.

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

UPS Supply Chain Survey: Nearly Half Worry about Product Tampering and Counterfeiting

In UPS’s 2nd Annual Supply Chain Survey, conducted by Harris Interactive, there was a somewhat surprising discovery as it relates to fraudulent and counterfeit products in the supply chain.

The survey was reported in the June 2009 issue of Pharmaceutical Commerce.

In the survey, decision makers at bio-pharma and med device companies were asked a variety of questions to identify supply chain issues beyond simple transportation and delivery.

The somewhat surprising discovery was that 48% of the large company respondents (companies with revenues in excess of $1 billion annually) while 34% of smaller companies, listed product tampering and counterfeiting as one of their biggest supply chain concerns for the year.

Pharmaceutical Commerce is quoted in the June 2009 issue:

It is worth noting that nearly half (48%) of large-company respondents cited product tampering and counterfeiting as a concern, which belies the relatively quieter scene in drug pedigree, tracking and tracing as a result of the postponement of the pedigree rules in California.

This survey validates much of what XStream Systems is finding in the pharmaceutical supply chain as well. Although much of the pressure has been lifted from the delayed pedigree rules, there is a realization among decision makers that there remains a significant amount of stress with few solutions within the supply chain as it relates to fraudulent, tampered and counterfeit product. To date many key executives have seemingly ignored the threat of increased liability and brand erosion because they have few if any solutions to adequately meet the issue. Pedigree and track and trace technologies although mandated in specific states, provides minimal protection against diverted products but do nothing to decrease their liability and protect their inventories from counterfeiting or tampered products.

XStream Systems, with its revolutionary EDXRD technologies, has a technology solution that enhances the ability of the members of the supply chain to authenticate the product, within its sealed container, without destroying or degrading the medication. This solution, allows the user to authenticate and verify the contents of the product, not just the package and properly secure their inventories and overall liability.

To read the June 2009 article in Pharmaceutical Commerce, visit: http://www.pharmaceuticalcommerce.com/frontEnd/main.php?idSeccion=1239.

To learn more about XStream Systems and it solution, visit: http://www.xstreamsystems.net/.

Schwarzenegger Terminates the Momentum of E-Pedigree in California

In a story reported in Drug Store News, Tuesday, California Governor Arnold Swarzenegger signed a bill which essentially pushes back the deadline for compliance of e-pedigree requirements within the supply chain until 2017.

Given the seriousness of the threat of counterfeit, adulterated and contaminated medications within the US pharmaceutical supply chain it is apparent that manufacturers, distributors and dispensers still need to take precautions to protect their drug inventories.

XStream’s EDXRD technology allows each member to independently protect itself from counterfeit and adulterated medications without an elaborate and expensive process that only tracks the transaction.

Cargo Theft: A Major Rx Supply Chain Issue

The June 23, 2008 issue of Drug Topics contains an article about the ever increasing issue of cargo theft and its impact on the drug supply chain.

Given the high dollar value of pharmaceutical shipments, shipments of all types of medications lead the list of targets for transit thieves.

Much of the article is based on a presentation at a National Boards of Pharmacy meeting by FBI Special Agent Ryan Toole. The article states, “….in 2005 there were reported thefts of $14 million worth of Lipitor (atorvastatin, Pfizer) and Viagra (sildenafil citrate, Pfizer), and $29 million worth of Novartis products. However, Toole said, there's a long list of types of drugs stolen, including those for acid reflux, cancer, depression, hypertension, stroke, and many other conditions.”

Obviously once these products are stolen, these medications often make their way back into legitimate channels via non-legitimate enterprises in a variety of formats. The major concern is what happens to the product once it is in the hands of the thieves. Once in the hands of a thief, the products and their containers can be altered, contaminated, diluted or diverted. It is, however, certain that at some point these products will ultimately find their way to the hands of a consumer in a format that may not be safe for consumption.

These types of thefts make the case for an authentication technology that can verify the molecular structure of the material inside the sealed container such as the XStream Systems’ XT250™ Material Identification System. Operating in conjunction with Track and Trace processes or as a standalone technology, the XT250 protects the inventories within each step in the supply chain from receiving products that have been highjacked and altered.

View the article in full at this link to Drug Topics.

XStream Systems to Present at Anti-Counterfeiting Conference

XStream Systems, Inc. announced today that it is scheduled to present at an Anti-Counterfeiting and Anti-Diversion conference which will be held on October 20 -21, 2008 in Vienna, Virginia.

The Center for Business Intelligence (CBI) has organized an annual conference to examine this extremely topical and important issue near the nation’s capitol.

The program of the conference is focused on preparing industry thought leaders for pending Federal Legislation and in the discussion of combating the illicit trade of pharmaceuticals by implementing security measures and tracking system.

XStream will be presenting a break out titled; Materials Authentication and Verification within the Pharmaceutical Supply Chain: Working with and Moving Beyond Track and Trace.

“We are excited about discussing the alternative solutions that work with and go beyond the capabilities of Track and Trace technologies to a group of influential industry stakeholders, “stated Alan Clock, SVP of XStream Systems. “No one product or solution will totally protect the global and domestic drug supply, the attendees of this conference will have a major influence in shaping the protection of the medications on which we all rely.”

To find out more about the CBI Conference or XStream Systems, visit the sites below:
http://www.cbinet.com/show_conference.cfm?confCode=PC08089&field=speakers
http://www.xstreamsystems.net/news.html

World Health Organization Statistics on Counterfeiting Worldwide

As reported in our last blog post, most experts agree (including the Chairman of Sanofi-Aventis) that the incidents of drug counterfeiting and adulterations are:

a) completely under reported
b) significantly on the rise

Just to put this into perspective, the following are the statistics from the World Health Organization on the Prevalence of Counterfeit Drugs in the West and the Developing World. These statistics represent WHO's 2006 estimates as to the percentage of counterfeit or adulterated drugs within that country or regions total drug supply chain.

• United States, less than 1%


• United Kingdom, less than 1%


• Europe, less than 1%, some estimate percentages as high as 10%


• Nigeria, 16%


• Kenya, 30%


• Lebanon, 35%


• Cambodia, 13%


• China, 8% on OTC medications


• India, 10-20%


• Indonesia, 25%


• Russia, 10%


• Former Soviet Republics, 20%


• Colombia, 5%


• Mexico, 10%


• Peru, 15-20%


• Venezuela, 25%

Realize that these numbers are all presumed to be very low and many of the percentages may have nearly doubled since 2006. Consider the tainted Heparin as a good example of the rise of counterfeit, adulterated or otherwise tainted drugs within the United States and other developed countries in 2008. Even the United States figure of less than 1% equals many billions of dollars in undetected counterfeit medications within our drug supply.

Most importantly realize that now, in the era of a Global Pharmaceutical Supply Chain that many drugs that are being imported into the United States and other developed countries now owe their source of raw materials, production and packaging to less developed countries like India, China and other countries whose pharmaceutical supply chain is riddled with counterfeit and adulterated medications.

Encourage your lawmakers and dispensers of medications to demand an authentication technology to double check the pharmaceuticals that your family consumes. Authentication of the pharmaceuticals is the only answer to properly knowing that the drugs you and your family are taking to maintain their health are not in fact harming them instead.

Current initiatives that are being debated in Washington and other regulatory agencies are almost exclusively centered on track and trace technologies that do not authenticate the drug. All the Heparin that has to date caused over 149 deaths in the United States all had a perfect pedigree and would have passed as authentic with track and trace technology.

What Measures Can Ensure the Integrity of Purchased Pharmaceuticals?

The integrity of our pharmaceutical supply chain is being questioned! Diversion, counterfeited products and adulterated ingredients have left consumers, regulators, and dispensers clamoring for more stringent anti-counterfeiting methods. Furthermore, the recent heparin recalls have emphasized the need for protection not only of the finished product, but also of the raw materials used in the production of medications.

In the May issue of Pharmacy Times, James C. McAllister, a health-systems consultant, addresses the security responsibilities of all players within the supply chain to combat these threats.

Mr. McAllister states, “Solving this dilemma will be challenging. Collaboration of pharmacists, manufacturers, wholesalers, and distributors, as well as regulatory agencies at the state and national level, should begin expeditiously.”

He moves forward to suggest that manufacturers bear all recall costs and financial responsibility for the quality of their drugs. For distributors and manufacturers, he asks that the FDA levy heavy economic sanctions on those selling substandard drugs. His proposal is a wake up call to the risks that are present – Those who risk our health – Risk their wealth.

Which begs the question - How do your anti-counterfeiting methods measure up?

Opinion: Heparin Deaths Just the Start

Unfortunately the recent FDA announcement of over 100 deaths due to contaminated Heparin, is just the start of a health care epidemic within the United States.

As with other consumable products that are now produced globally, the United States Pharmaceutical Supply Chain is now more vulnerable than ever.

In 2008 nearly every pharmaceutical manufacturer has doubled their overseas production. Additionally over 80% of all raw materials used in the production of pharmaceutical products is produced overseas

We here in the United States have been relatively protected from exposure to contaminated, adulterated and counterfeit medications that has been a scourge for the rest of the world for many years.

In 2006 it was estimated that the US Pharmaceutical Supply Chain had only 1% of its channel impacted by contaminated, adulterated or counterfeit medications. This still meant that one in nine citizens had at least one of its prescriptions filled with bogus medication.

Globally this statistic in 2006 was that nearly 10% of medications or one in ten within the Global Pharmaceutical Supply Chain were fake and potentially lethal.

* Expect the percentage of the United States Supply Chain of fake medications to rapidly grow in 2008 with the rise of more Heparin-like incidents. Most likely the United State's Pharmaceutical Supply Chain will begin to mirror the Global Supply Chain statisically.
* Expect to hear stories in the media with dozens, hundreds or even thousands in the Untied States made ill or even die because there are no effective measures in place to authenticate the validity of the medications within the Supply Chain. No longer will the stories of hundreds of people dying because of contaminated or fake medications be exclusive to underdeveloped areas of Africa and Asia.

Even though the technology is currently proven and readily available to authenticate the molecular structure of medications within a sealed bottle, the regulatory, manufacturing, distribution and dispensing members of the Pharmaceutical Supply Chain are hesitant or unwilling to deploy effective measures and appropriate technology to protect the United States consumer.

Fortunately the solution and technology is available today to prevent these impending health care disasters due to fake and contaminated medications. Now all we have to do is convince the members of the supply chain and the regulatory agencies to put it in place.

Just check out our website at www.xstreamsystems.net to see the solution.