Slideshows

The Painful Costs of Counterfeit Prescription Drugs

The World of Counterfeit Drugs

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Counterfeit prescription pharmaceuticals are widely recognized as a growing public health risk and a serious concern to public health officials, private companies, and consumers. This slideshow presents a shortened overview of the longer report, In some countries around the world, counterfeit prescription drugs comprise as much as 70% of the drug supply and have been responsible for thousands of deaths in some of the world’s most impoverished nations, according to the World Health Organization
Photo: Image Source and Paul Alvord

Counterfeit prescription pharmaceuticals are widely recognized as a growing public health risk and a serious concern to public health officials, private companies, and consumers. This slideshow presents a shortened overview of the longer report, found here.

In some countries around the world, counterfeit prescription drugs comprise as much as 70% of the drug supply and have been responsible for thousands of deaths in some of the world’s most impoverished nations, according to the World Health Organization (WHO). However, in most of the world’s developed countries, effective regulatory systems and market controls cause an extremely low proportion of counterfeit pharmaceuticals, usually below 1%. But even patients in developed countries can still be affected by counterfeit drugs, and deaths linked to counterfeit drugs occur every year in the U.S. and Western Europe — and even more often in South America, Asia and Africa.

The counterfeit pharmaceuticals industry is estimated to be a billion-dollar industry, and some have estimated it to be vastly larger. Peter Pitts, President of The Center for Medicine in the Public Interest and former Food and Drug Administration Associate Commissioner, estimates that in 2010, activities related to counterfeit drugs generated $75 billion, and may grow by 20% annually in coming years. The $75 billion number is based on information obtained from government organizations, says Pitts. If this estimate is correct, the counterfeit pharmaceutical industry generates nearly as much cash as the world’s fourth-largest health care company by revenues, AmerisourceBergen, with revenues of approximately $79 billion over the last 12 months.

In this CNBC.com special report,we look at the world of counterfeit pharmaceuticals — from where they’re produced, to what is being done to combat them, to how they can hurt you.

By Paul Toscano
Posted 4 Oct 2011

What Are Counterfeit Pharmaceuticals?

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Counterfeit pharmaceutical drugs are fraudulently produced or mislabeled medicines purchased by consumers who believe them to be genuine. These drugs can cause a range of serious health concerns. The fake pills may look identical to their genuine counterparts but may be incorrectly formulated and produced in sub-standard conditions. They are by definition not subject to the same regulatory scrutiny as legitimate medications. The drugs often have incorrect amounts of active ingredients, if those
Photo: Getty Images

Counterfeit pharmaceutical drugs are fraudulently produced or mislabeled medicines purchased by consumers who believe them to be genuine. These drugs can cause a range of serious health concerns. The fake pills may look identical to their genuine counterparts but may be incorrectly formulated and produced in sub-standard conditions. They are by definition not subject to the same regulatory scrutiny as legitimate medications. The drugs often have incorrect amounts of active ingredients, if those ingredients are present at all, and are illegal in developed countries.

What else do you need to know about counterfeit drugs? Click here to find out.

Which Drugs Get Counterfeited?

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The counterfeit drug industry is difficult to track, but several attempts have been made to understand the types of drugs affected. In a 2008 report, the WHO’s International Medical Products Anti-Counterfeiting Taskforce (IMPACT) used seizure information to estimate the proportion of counterfeiting done by category. The findings revealed that the most counterfeited drugs were in the Genito-urinary category (37% of seizures), followed by anti-infectives (12%) and central nervous system drugs (12%
Photo: Getty Images

The counterfeit drug industry is difficult to track, but several attempts have been made to understand the types of drugs affected.

In a 2008 report, the WHO’s International Medical Products Anti-Counterfeiting Taskforce (IMPACT) used seizure information to estimate the proportion of counterfeiting done by category. The findings revealed that the most counterfeited drugs were in the genito-urinary category (37% of seizures), followed by anti-infectives (12%) and central nervous system drugs (12%). Genito-urinary medicines include treatments for sexually transmitted infections and diseases, as well as sexual dysfunction and contraception. This category includes drugs such as the erectile dysfunction drug Viagra - believed by both companies and international organizations to be the world’s most counterfeited drug - as well as medications for HIV and AIDS.

Which other drugs have been counterfeited? Click here to find out.

Ingredients Found in Counterfeit Drugs

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The dangers of counterfeit drugs are two-fold. First, counterfeit drugs may contain an incorrect amount of active ingredient or no active ingredient at all. The public health risk for this type of counterfeit drug is significant, since users of these medications intend to treat an illness or a disease. By using counterfeit medicines they may be going untreated. This can result in treatment failure, increased resistance to treatment, and even death, according to the World Health Organization. Som
Photo: Pfizer | Reprinted with Permission || Pictured: Counterfeit drug ingredients found at an illegal drug lab in India.

The dangers of counterfeit drugs are two-fold. First, counterfeit drugs may contain an incorrect amount of active ingredient or no active ingredient at all. The public health risk for this type of counterfeit drug is significant, since users of these medications intend to treat an illness or a disease. By using counterfeit medicines they may be going untreated. This can result in treatment failure, increased resistance to treatment, and even death, according to the World Health Organization.

Some counterfeits have little or no active pharmaceutical substance--many contain innocuous ingredients, although nothing an individual would want to ingest when expecting medication. These ingredients have included chalk, flour, vitamins, talcum powder or sugar, which, when taken with the expectation of having a pharmacological effect, can be fatal.

Click here to read more about the substances found in counterfeit drugs

Deadly and Dangerous Examples

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Although some medications are more frequently counterfeited than others, any drug--from pain medication and antibiotics to lifestyle drugs and even animal medications--can be counterfeited. One of the most notable recent examples is the blood thinner Heparin, which in 2008 was found to have counterfeit active ingredients sourced from Changzhou SPL in China, causing extensive recalls of the drug. In this case, the active ingredient in Heparin was replaced with a cheaper counterfeit substitute, ca
Photo: Jeffrey Sauger | Bloomberg | Getty Images

Although some medications are more frequently counterfeited than others, any drug--from pain medication and antibiotics to lifestyle drugs and even animal medications--can be counterfeited. One of the most notable recent examples is the blood thinner Heparin, which in 2008 was found to have counterfeit active ingredients sourced from Changzhou SPL in China, causing extensive recalls of the drug.

In this case, the active ingredient in Heparin was replaced with a cheaper counterfeit substitute, causing a range of adverse reactions and a nationwide series of recalls. Eventually it was suspected in as many as 81 deaths. However, Baxter, the company which sold the drug in the United States, maintains that the number is far lower. As a result of the contamination, Baxter faced 740 lawsuits and eventually sold the division that produced the drug.

Heparin is only one of the dangerous examples of fake medications. To read more, click here.

Where Are They Purchased?

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Protecting against counterfeit pharmaceuticals is relatively straightforward: avoid certain types of merchants. The major makers of fake medical products are unregulated online pharmacies, which is the most common method for these drugs to get into the hands of American consumers, according to drug companies, international organizations, and the FDA. Most of these pharmacies offer physician-prescribed drugs, without a prescription, for importation to the United States - a practice that is “almos
Photo: Google.com

Protecting against counterfeit pharmaceuticals is relatively straightforward: avoid certain types of merchants. The major makers of fake medical products are unregulated online pharmacies, which is the most common method for these drugs to get into the hands of American consumers, according to drug companies, international organizations, and the FDA.

Most of these pharmacies offer physician-prescribed drugs, without a prescription, for importation to the United States - a practice that is “almost always unlawful,” according to the U.S. Justice Department - and often listed at enticing prices. Andrew Jackson, Head of Security at Novartis, says that “if anything is too good to be true, it probably is. Google ‘Lipitor without prescription’ and you’ll find hundreds, if not thousands, of internet pharmacies,” he says, “and the vast majority are not approved by the FDA, but appear to be Canadian in origin... They feature smiling medical professionals offering prescription-free pharmaceuticals... but you don’t have to dig too far to discover that the sites are not based in Canada at all.”

What are some signs that an online pharmacy is fake? Click here to read more.

Are All Online Pharmacies Bad?

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No. There are legitimate online pharmacies considered safe. To distinguish between the two, The National Association of Boards of Pharmacy (NABP) developed the VIPPS accreditation program, which evaluates internet pharmacy practice, including on-site surveys. “If you’re on a VIPPS site, it’ll be as close to a traditional pharmacy as you can get,” says Patrick Ford. You can identify At the time of this writing, there are only 29 online pharmacies holding VIPPS accreditation.
Photo: tabsfast.com

No. There are legitimate online pharmacies considered safe. To distinguish between the two, The National Association of Boards of Pharmacy (NABP) developed the VIPPS accreditation program, which evaluates internet pharmacy practice, including on-site surveys. “If you’re on a VIPPS site, it’ll be as close to a traditional pharmacy as you can get,” says Patrick Ford. You can identify VIPPS accredited websites here. At the time of this writing, there are only 29 online pharmacies holding VIPPS accreditation.

What do the online pharmacies have to say about the situation? Click here to find out.

Why Counterfeit Drugs Are Made

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Perhaps the best way to describe the motivation behind counterfeiting is offered by Andrew Jackson, Head of Security for Novartis: “Pretend that you graduated from the ‘University of Crime’ and you are considering two career options. Which path you would follow? First, you can manufacture and sell cocaine, and if you get caught, you may spend 20 years or more in jail. Your second option is to manufacture and sell counterfeit pharmaceuticals. If you get caught, you’ll be sentenced to prison for t
Photo: Vstock LLC | Getty Images

Perhaps the best way to describe the motivation behind counterfeiting is offered by Andrew Jackson, Head of Security for Novartis: “Pretend that you graduated from the ‘University of Crime’ and you are considering two career options. Which path you would follow? First, you can manufacture and sell cocaine, and if you get caught, you may spend 20 years or more in jail. Your second option is to manufacture and sell counterfeit pharmaceuticals. If you get caught, you’ll be sentenced to prison for two years and may be back on the street in six months.”

For more on the manufacturing and demand for counterfeit drugs, click here.

How Do They Get Into the U.S.?

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Unlike other illicit substances smuggled into the United States, counterfeit pharmaceuticals most often find their way into the country through more “common” means. According to U.S. Immigration and Customs Enforcement (ICE), the most frequent method for importing counterfeit pharmaceuticals is through express mail services, such as FedEx, UPS, the U.S. mail, and Chinese-based express mail services. This method makes the task for enforcement more difficult, says William Ross, Unit Chief at ICE’s
Photo: Guenter Schiffmann | Bloomberg | Getty Images

Unlike other illicit substances smuggled into the United States, counterfeit pharmaceuticals most often find their way into the country through more “common” means. According to U.S. Immigration and Customs Enforcement (ICE), the most frequent method for importing counterfeit pharmaceuticals is through express mail services, such as FedEx, UPS, the U.S. mail, and Chinese-based express mail services.

This method makes the task for enforcement more difficult, says William Ross, Unit Chief at ICE’s National Intellectual Property Rights Coordination Center. Express mail shipments make detection more involved and the process more time-consuming compared to items shipped in large containers, he says.

How many counterfeit drugs were seized last year by U.S. Customs? Click here for the numbers.

Who Makes Counterfeit Drugs?

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There have been numerous cases of counterfeit drug labs operating within complex international frameworks. Experts often link the production of counterfeit pharmaceuticals to organized crime. In one case that led to seizures and investigation, counterfeit drugs produced in China were transported by road to Hong Kong, sent by air to Dubai, passing through London Heathrow on the way to the Bahamas, where the organization kept a warehouse fulfillment center. From there, the drugs were sent to anoth
Photo: Pfizer | Reprinted with Permission || Pictured: Confiscated counterfeit drug-making equipment is demonstrated after a raid in Pakistan.

There have been numerous cases of counterfeit drug labs operating within complex international frameworks. Experts often link the production of counterfeit pharmaceuticals to organized crime. In one case that led to seizures and investigation, counterfeit drugs produced in China were transported by road to Hong Kong, sent by air to Dubai, passing through London Heathrow on the way to the Bahamas, where the organization kept a warehouse fulfillment center. From there, the drugs were sent to another organization in the United Kingdom, which eventually sent the packages to the United States. “This is not exactly a mom-and-pop operation,” says Andrew Jackson of Novartis, “it’s organized crime.”

Which organizations have known connections to the counterfeit drug trade? You may be surprised to find out.

Illicit Drug Labs

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Drug manufacturers in the United States are required to follow Good Manufacturing Practices (GMP) under the which goes a long way in ensuring the safety and reliability of prescription drugs in the country. Industry experts believe most counterfeit medicines are produced in non-GMP conditions by uncontrolled or street laboratories. One of the companies directly combating these clandestine drug labs is Pfizer, which provided the images on the left. The images were taken during raids of known drug
Photo: Pfizer | Reprinted with Permission || Pictured: A raided counterfeit drug lab in China

Drug manufacturers in the United States are required to follow Good Manufacturing Practices (GMP) under the Federal Food, Drug and Cosmetic Act,which goes a long way in ensuring the safety and reliability of prescription drugs in the country.

Industry experts believe most counterfeit medicines are produced in non-GMP conditions by uncontrolled or street laboratories. One of the companies directly combating these clandestine drug labs is Pfizer, which provided the images on the left. The images were taken during raids of known drug labs in coordination with local authorities. The photos were taken during a drug raid in China, and Pfizer provided a number of additional images to CNBC taken around the world, which can be seen here.The conditions in these labs have been described by Pfizer as “deplorable,” citing mold on the walls and “dirt all over the place.”

For more photos and examples of these drug labs, click here.

What Do Counterfeit Drugs Look Like?

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One reason it is so difficult to detect counterfeit medicines is that they appear strikingly similar to the genuine products. In these photos, counterfeit and genuine Lipitor tablets, as well as counterfeit Tamiflu, are shown side-by-side. For both examples, authentic medication appears on the left, while the counterfeit is on the right. The Tamiflu blister packs display how the duplication of packaging can also appear nearly identical to the genuine product, with the authentic medication on the
Photo: (Top) Pfizer | Reprinted with Permission || (Bottom) FDA Flickr

One reason it is so difficult to detect counterfeit medicines is that they appear strikingly similar to the genuine products. In these photos, counterfeit and genuine Lipitor tablets, as well as counterfeit Tamiflu, are shown side-by-side. For both examples, authentic medication appears on the left, while the counterfeit is on the right. The Tamiflu blister packs display how the duplication of packaging can also appear nearly identical to the genuine product, with the authentic medication on the right and the counterfeit on the left.

How can you know if your drugs are counterfeit? Click here to see what experts say.

Are There Ways to Combat Counterfeits?

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Howard Zucker, former Assistant Director General of the WHO and former Head of IMPACT, says there are five areas that must be addressed in order to combat counterfeits: Technology, strong legislation, enforcement, unilateral regulatory standards and public knowledge.
Photo: Getty Images

Howard Zucker, former Assistant Director General of the WHO and former Head of IMPACT, says there are five areas that must be addressed in order to combat counterfeits: Technology, strong legislation, enforcement, unilateral regulatory standards and public knowledge.

How could these be employed and what international issues stand in the way? Click here to find out.

What Companies Are Doing

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Pharmaceutical companies are at the center of the effort against counterfeit drugs, with the largest American pharmaceutical companies dedicating resources to contain the problem. Technologies such as Radio Frequency Identification (RFID), holographic labels, infrared inks, supply chain tracking, digital serial number identification chromatography are being employed as anti-counterfeiting measures, although with varying degrees of success.
Photo: Dominique Faquet | AFP | Getty Images

Pharmaceutical companies are at the center of the effort against counterfeit drugs, with the largest American pharmaceutical companies dedicating resources to contain the problem. Technologies such as Radio Frequency Identification (RFID), holographic labels, infrared inks, supply chain tracking, digital serial number identification chromatography and even chemical “fingerprints” are being employed as anti-counterfeiting measures, although with varying degrees of success.

Some companies are taking a more direct approach. Click here to see how they are working with local law enforcement.

How Can You Protect Yourself?

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The best way to protect yourself is to buy pharmaceutical products at trusted retailers and avoid non-regulated online pharmacies. Experts like Howard Zucker encourage Americans traveling abroad to take their medications with them and avoid purchasing drugs abroad. “Try to keep your eyes open in developing countries,” he says. One of the best things you can do, experts say, is to educate yourself about the drugs you take. Below you’ll find some helpful links on the subject:
Photo: Jose Luis Pelaez | Iconica | Getty Images

The best way to protect yourself is to buy pharmaceutical products at trusted retailers and avoid non-regulated online pharmacies. Experts like Howard Zucker encourage Americans traveling abroad to take their medications with them and avoid purchasing drugs abroad. “Try to keep your eyes open in developing countries,” he says.

One of the best things you can do, experts say, is to educate yourself about the drugs you take. Below you’ll find some helpful links on the subject:

The World Health Organization:
General Information
Counterfeit SFFC Medications
International Medical Products Anti-Counterfeiting Taskforce (IMPACT)

The U.S. FDA:
Counterfeit Pharmaceuticals Information
Initiative to Combat Counterfeit Drugs
Report Suspicious Websites

Other Resources:
The National Association of Boards of Pharmacists (NABP)
VIPPS Online Pharmacy Accreditation
The Full Story: The Dangerous World of Counterfeit Drugs