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Part I: Executive Summary
Counterfeit drugs, including fake, substandard, adulterated or falsely labeled (“misbranded”) medicines, have become a real and growing threat to global health. Increasingly sophisticated counterfeiting rings, often involving organized crime, are slipping their fakes into the legitimate drug supply around the world. The problem is especially serious in developing countries, where hundreds of thousands die from ineffective medicines, and millions more from the drug-resistant strains of pathogens such as malaria, HIV/AIDS and tuberculosis that have been promoted by counterfeits’ suboptimal dosing of antibiotics and anti-viral agents.
Even the U.S. drug supply, among the most secure in the world, is increasingly threatened by counterfeit or substandard drugs. The last few years have seen a rising number of cases of counterfeits turning up in neighborhood pharmacies, including fake versions of some of the nation’s most popular drugs. The main point of entry for the counterfeits has been the “gray market,” a loose and complex network of drug diverters and secondary wholesalers that makes it possible for distributors to introduce diverted and sometimes counterfeit drugs into the legitimate drug supply chain. The risk of counterfeits is even greater when individuals import drugs or purchase from unregulated online sites.
Efforts to secure the system have focused on the pedigree provisions of the Prescription Drug Marketing Act (PDMA), which after two decades of delay, the FDA will soon begin to enforce. However, to be effective, the pedigree requirement must be combined in a multi-layered strategy with new emerging anti-counterfeit technology, such as RFID, and the reform of the wholesale industry. Moreover, because regulations are meaningless without effective enforcement, state and federal officials must be given the authority and resources they need to enforce the laws, and penalties must be increased for those who violate them.
How can consumers protect themselves? By paying attention to the drugs they take and their effects and reporting anything suspicious or unusual to appropriate authorities. Online drug shoppers should only use those legitimate Internet pharmacies that have been approved by the National Association of Boards of Pharmacies.
Part II: Overview of Counterfeit Drugs
According to the World Health Organization, a “counterfeit medicine is one which is deliberately and fraudulently mislabeled with respect to identity, composition and/or source.” This definition of counterfeits includes not only completely fake drugs, but also those that have been tampered with, adulterated, diluted, repackaged or relabeled so as to misrepresent the dosage, origin or expiration date, as well as substandard drugs that were cheaply produced in order to make unlawful profit.
Counterfeit drugs represent a real and growing danger to global health. The most widely-cited estimate is that 10% of the world’s drug supply is counterfeit and the counterfeit drug industry’s sales are expected to reach $75 billion by 2010, representing a 92% increase from 2005. The world’s largest producers of counterfeits are believed to be China and India, as well as Southeast Asia, Nigeria, Russia, Mexico, Brazil and Latin America.
Contributing to this growth has been the increasing size and sophistication of drug counterfeiting rings and the widening involvement of organized crime groups, including the “Russian mafia,” Chinese triads, Colombian drug cartels, Mexican gangs, and even terrorist groups such as Hezbollah, IRA and ETA. Counterfeiters now have the ability to produce near-perfect fakes that are indistinguishable to all except well-trained experts (see Figure 1).
Counterfeits in Developing Countries
Counterfeiting is an especially serious problem in developing countries, where supply shortages, lax regulations and oversight, and corruption allow the trade to thrive. According to the WHO, 60% of counterfeit drug cases take place in less-developed countries, where it is estimated that more than 25% of the drug supply is counterfeit. The percentages are worse in certain areas: 38% in Southeast Asia, 48% in Africa. Indeed, a recent study of pharmaceuticals on sale in Nigeria’s capital found that 80% were fake and 7% contained dangerous ingredients. Such dangerous counterfeits kill thousands each year in developing countries, in incidents such as the hundreds of children who died in Haiti in the early 1990’s after taking cough syrup made with antifreeze.
Even worse, the trade in counterfeit drugs is responsible for increasing drug-resistance among some of the world’s most deadly infectious diseases, including malaria, tuberculosis and HIV/AIDS. The reason is that most counterfeit, substandard or degraded medicines contain incorrect levels of a drug’s active ingredient, which causes the weaker strains of the causal agent to be killed off while allowing the drug-resistant strains to multiply and adapt. A 2004 study found that 53% of the antimalarials being sold in Southeast Asia contained incorrect levels of the active ingredient, while it is estimated that as much as 85% of the malaria drugs in Nigeria are ineffective (see Figure 2). This has contributed to a doubling of malaria deaths over the last 20 years (to more than 1.5 million people per year, 90% of them children) as substandard therapy has caused the disease to become more quickly resistant to a succession of drugs.
In addition to antimalarials, a growing trade in counterfeit antiretroviral drugs for HIV/AIDs in Africa has caused the virus to become increasingly resistant to first-line therapies, forcing health officials to resort to second-line antiretrovirals, which are more toxic than first-lines, can cost over 20 times more and require hospitalization, significantly reducing access to these desperately-needed medicines.
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