The dangers of fake medicines are due to be addressed in upcoming EU legislation but an international solution may be needed to solve a problem with global implications.

Overview

The problem of counterfeit medicines has grown steadily over the past decade – fuelled in part by the Internet – posing a major public health hazard and becoming a headache for customs authorities.

The volume of fake medicines seized by European authorities has risen but counterfeits continue to find their way into the supply chain. Research has found falsified medicines have been unwittingly sold over-the-counter by retail pharmacies in addition to booming online sales.

Over the past decade, there has been a significant increase in amount of counterfeit medicines reaching consumers across Europe through illicit sources, including the Internet.

Seizures at EU borders have increased from just over half a million articles in 2005 to over four million in 2007. More recently, 34 million fake tablets were seized on European boarders in just two months.

The trade in counterfeit medicine sales has exploded and it is now estimated that global counterfeit drug sales will reach €60 billion this year. In Europe alone, the fake drugs market is estimated to be worth more than €10.5bn every year.

Research suggests that one in five Europeans is putting themselves at risk and admit purchasing prescription-only medicines without a prescription – that's over 77 million people.

The problem affects poor populations just as much as it hits wealthy nations. The WHO estimates that counterfeit drugs constitute up to 25% of the total medicine supply in less developed countries.

According to a report by the International Policy Network, a detailed study of medicines in Africa and South East Asia revealed that between 30% and 60% of medicines were "substandard". The largest producers of fake medicines are India and China, according to the IPN.

Issues

Lifestyle drugs such as Viagra had typically been seen as providing a lucrative Internet market – evidenced by the burgeoning number of spam email messages from illegal suppliers.

However, the pharmaceutical industry's concern was heightened when Lipitor, the blockbuster cholesterol medication, was found to have been counterfeited. Dozens of other top-selling prescription drugs have followed, with fake versions of everything from blood thinning medicines to osteoporosis tablets finding their way into patients' medicine cabinets.

The pace with which criminal gangs capitalise on market demand was illustrated by the swift emergence of fake vaccines and antiviral medicines during the peak of the H1N1 flu pandemic (EurActiv 27/10/09).

EU pharma package

In response to this growing problem, the EU is working to beef up its legislation on falsified medicines. The European Commission published its long-awaited 'pharma package' in December 2008, which featured a proposal for a new directive on counterfeit medicines (EurActiv 11/12/08). 

Various methods for tracking and verifying legal drugs have been proposed but a final deal has yet to be signed off.

The dossier must be approved by the European Parliament, which indicated from the outset that it wanted to strengthen the directive to include fake medicines sold over the Internet (EurActiv 01/10/09). 

The directive has been winding its way through European Parliament committees but this still has to be endorsed by a full sitting of MEPs (EurActiv 01/10/09EurActiv 28/04/10).

Arguably the most difficult problem for policymakers is that while the legislative process is thorough but slow, bootleggers have consistently proven themselves to be nimble and responded quickly to regulatory efforts designed to put them out of business.

Dangers of fake medicines

Counterfeit drugs are a health risk for a number of reasons. The first is simply that a product may fail to provide effective treatment as they do not contain enough of the active ingredient to tackle the patient's disease.

The International Policy Network estimates that around 700,000 deaths from malaria and tuberculosis can be attributed to patients taking fake medicines which prove ineffective.

A second danger is that falsified medicines can be adulterated with toxic chemicals. Antifreeze and rat poison are among the most commonly cited bulking agents found in uncontrolled medicinal products.

Where a drug contains some – but not enough – of an active ingredient, the risk is that it will not kill the disease agent (such as a bacterium). This can lead to the emergence of drug-resistant strains, a phenomenon that poses a major public health challenge in dealing with malaria, TB, HIV and a range of other parasites.

A complex global supply chain

The route consignments of illegal medicines take into European markets can be long and complex but, as yet, the problem has proven stubbornly difficult to stamp out.

The main source countries for fake drugs include China and India, but shipments also frequently pass through Free Trade Zones (FTZ), where regulation is seen as lax.

In all cases, networks of organised crime gangs are implicated in capitalising on demand from patients in Europe and the US.

Customs officers in Dubai, for example, are stepping up inspections under pressure from international trading partners after falsified medicines sold to American consumers were traced back through Dubai's FTZ.

Similarly, Colón Free Trade Zone next to the Panama Canal has come under the spotlight as an area through which illegal products have passed without rigorous checks.

Essential medicines being faked – not just Viagra

Frequently counterfeited drugs have included erectile dysfunction medicines such as Viagra, Levitra and Cialis, which are used for lifestyle purposes and would normally require a prescription when sourced legitimately.

However, top-selling drugs for cholesterol, osteoporosis, acid reflux, cancer and blood thinning have all been mimicked by criminals keen to tap into the huge markets for chronic diseases which affect ageing populations.

Fake drugs now exist in most therapeutic classes and the problem can even extend to non-pharmacological medical products such as syringes and electronic medical equipment.

While Europe is naturally concerned with keeping falsified medicines from entering its borders, the threat remains for poorer populations in countries with weak legal systems. Industry groups complain that their brands are misappropriated by bootleggers in developing countries where it is difficult to enforce trademarks.

Counterfeit malaria medicines have proven deeply problematic in Asia and Africa, where patients are looking for low-cost drugs, and it is difficult to distinguish between real and fake products.

Legislators search for solutions

By 2006, the problem of counterfeit medicines had become so severe that the World Health Organisation (WHO) launched an International Medical Products Anti-Counterfeiting Taskforce (IMPACT).

IMPACT has helped coordinate international operations to target fake pharmaceutical products in Africa and elsewhere. The WHO's role in IMPACT has been criticised by health groups but the Organisation is expected to clarify its role in the near future, stressing that its involvement is limited to public health elements of the initiative.

In Europe, the major counteroffensive against fake drugs has come in the form of the Falsified Medicines Directive proposed by the European Commission in December 2008.

The proposal suggested that all medicinal products would carry authenticity features and a tamper-proof seal. However, the directive came under fire from industry and consumer groups for failing to tackle the problem of counterfeit medicines sold on the Internet.

MEPs have amended the proposal at committee level to target illegal online pharmacies but the directive has yet to be voted on by a full sitting of the Parliament (EurActiv 28/04/10)

Policymakers are keen not to ban legal online pharmacies and some have suggested that a seal of authenticity could be used by Internet chemists. This has been criticised by pharmacists who say any such logo would be faked within hours and may ultimately prove useless (EurActiv 21/05/10).

Balancing safety with internal market rules

The specifics of how to verify packs of medicines is also still being debated. The problem is complicated by the practice of parallel trading, where companies take advantage of the internal market by repackaging legal medicines and selling them elsewhere in Europe.

A typical example would be cases where cholesterol drugs are bought in Greece for a low price and sold on the UK market where they can fetch a higher price.

Track-and-trace technology can help follow packages through the supply system but parallel traders have argued for a system which allows them to repackage drugs.

Swedish pharmacists have tested a 2D barcode system which checks whether a pack is real and verifies whether it has ever been dispensed (EurActiv 10/04/10). The system is similar to that previously introduced by Brazil.

While the research-based pharmaceutical industry has lobbied for a comprehensive system which applies across the EU, the generics sector is seeking exemptions on the grounds that their products pose a much lower risk of counterfeiting.

Other hurdles to implementing the directive include resolving the question of who will bear the cost of new product verification technology and how data collected in retail pharmacies will be handled.

The cost burden for small wholesalers could also prove problematic if new safety features are applied to all products.

Positions

French MEP Françoise Grossetête (European People's Party) wants the final draft of the Counterfeit Medicines Directive to block repackaging of medicines.

"It's a pity we're not as demanding of medicines as we are on food. We allow medicine boxes to be repackaged but you cannot do that with spaghetti under the new food legislation. I don't know why we're tolerating this," she said.

Grossetête said the current draft does not provide enough clarity on generic medicines, adding that all medicines should be dealt with in the same way, including off-patent and non-prescription drugs.

UK MEP Marina Yannakoudakis (European Conservatives and Reformists group) said counterfeiting is a criminal offence and consumers should be protected against falsified medicines.

She said criminals will look for ways around the proposed measures and the Parliament will have to stay on top of the issue.

Greek MEP Michail Tremopoulos (Greens) said his group is focused on strengthening and expanding the safety features on prescription and non-prescription medicines. He said it was important to regulate legal online pharmacies and to block illegal sales.

However, he warned that restrictions on parallel trade will hurt governments struggling to keep the costs of medicines under control.

The European Federation of Pharmaceutical Industry Associations (EFPIA) says the Commission's proposal is a step in the right direction but must go further in order to fully ensure patient safety.

In a position paper, EFPIA said counterfeit medicines can only be prevented from infiltrating the supply chain if the integrity of the original package is maintained throughout the entire supply chain, "from the time it leaves the original manufacturers' hands until it reaches the patient".

The industry group says an efficient technological anti-counterfeiting strategy should include tamper-resistant features; overt, covert and forensic authentification features; and pack identification systems. The research-based companies want to see repackaging banned.

"The anti-counterfeiting proposals should ensure pack integrity from manufacturer to patient; the simplest way to achieve this would be a ban on repackaging," EFPIA Director-General Brian Ager wrote in a letter to health ministers in December 2009.

John Chave of the Pharmaceutical Group of the European Union (PGEU) said pharmacists accept that swift action is needed to shore up the medicines supply chain. 

However, he cautioned against focusing exclusively on so-called "high risk" medicines, arguing that bootleggers will simply move on to counterfeiting other drugs. According to Chave, the cost of implementing new traceability systems must be proportionate and pharmacists have concerns about data protection. 

Personal information from customers must be safeguarded, he said, but so too should sensitive commercial data on what medicines pharmacists dispense. 

"Transactional data is normally the property of pharmacists and should not be available for commercial exploitation by third parties," he said. On Internet trade, Chave said the most effective measure against Web sales is prohibition, which is used in the United States. 

Chave also dismissed the idea of having a quality mark to identify legitimate Internet pharmacies. "The idea that you can get around online counterfeiting through certification is quite difficult. An EU authenticity mark would be immediately faked. We would be asking patients to differentiate between genuine and forged logos," he said.

Monika Derecque-Pois, who represents pharmaceutical wholesalers, said 2-D barcodes "are the only way forward," although she acknowledged that radio frequency identification (RFID) could become useful in future. The problem with RFID, she said, is that it is not accurate when the frequency is too low, and it can boil some medicines if the frequency is too high. 

Derecque-Pois called for all participants in the medicines supply chain to be fully licensed and for the licensing system to be more transparent. 

Claudia Glasow from Ursapharm, a German pharmaceutical SME, said the costs for small producers of adding traceability features can be high. She said manufacturers would have to spend at least €40,000 on cameras and scanners for each production line. In addition, specialist software would be required, at a cost of between €80,000 and €120,000. 

Glasow highlighted the technical challenges of adding barcodes to small boxes of eye drops while also complying with labelling guidelines. She agreed that Internet trade remains a primary source of low quality counterfeit medicines and that this must be addressed. 

Boris Azaïs, Director of Industrial Policy Europe at MSD said, "Counterfeit medicines represent a growing threat to public health, and stakeholders need to work together to fight this criminal activity. Raising awareness of the issue in a responsible way is a key part of protecting patients, and crucially, maintaining trust in European healthcare systems. MSD continues to take an active role in working to better protect patients from fake, life threatening medicines. Public health stakeholders all have a responsibility in ensuring that patients get access to medicines which high quality is guaranteed through stringent supply chain standards."

Domenico Di Giorgio from the Italian Medicines Agency says the market for counterfeit drugs used to focus on "lifestyle" medicines such as Viagra and weight loss pills, but there is now a booming trade in anti-cholesterol medication and anticoagulants such as heparin. 

He said Italy had put in place an effective "track and trace" system which has put a major dent in the illegal drugs trade. "It's not impossible to get illegal medicines into the system but it's very expensive," he said. 

John Ricketts of drugmaker Lilly Europe said counterfeit medicine producers use very crude manufacturing facilities, but "the one thing they invest in is packaging," making it very difficult to differentiate between real and fake medicines. 

He said a combination of robust measures is needed to stamp out illegal trade. The simplest way would be to ban repackaging, he said, but the Commission has avoided this for fear of putting parallel traders out of business. 

If parallel traders are allowed to stay in business, said Ricketts, they should be forced to apply equivalent safety features to those required of pharmaceutical companies. He said the research-based pharmaceutical sector is in favour of 2-D barcodes to aid traceability, and companies are also using nanotechnology "deep holograms" to help tell real packages from fake ones. 

"If it is going to take until 2013 to implement this directive, we would like to see interim measures introduced between the time an agreement is reached and its implementation," Ricketts said. 

The secretary-general of the Belgian Pharmacists' AssociationDirk Broeckx, said Belgium had introduced a system whereby every type of pharmaceutical product is examined. 

Using a unique barcode system, pharmacists are instantly informed when they try to dispense illegal or unsafe medicines. Product recalls can be done with great efficiency, Broeckx said, adding that Belgian pharmacists have benefited from adopting the system. 

"We have been proactive and as first movers, we have had the opportunity to steer the system as it develops," he said. He said there are costs for manufacturers and pharmacists, but these are largely compensated for by the added value of having a safer, more efficient system, which reduces pharmacists' liability arising from selling dangerous products. 

Gary Noon, CEO of Aegate, the company that provides the system used by Belgian pharmacists, said authorities and industry must make it uneconomical for criminals to continue manufacturing counterfeit drugs. 

He said the system had been rolled out in Belgium, Greece and Italy and had been highly successful. Noon said his view is that the transactional data collected by the system belongs to pharmacists and it is not shared with third parties.

The European Medicines Agency (EMA) has expressed concern at the rise in fake medicines.

"Counterfeits may include fakes which do not contain any of the medicine or contain the wrong medicine. The EU has a strong legal framework for the licensing, manufacturing and distribution of medicines. The EMEA, the European Commission and the member states cooperate closely to combat fake medicines. This cooperation also includes the Council of Europe (in particular EDQM) and WHO (IMPACT)," the Agency said in a statement.

The International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) has published ten principles for tackling counterfeiting. Haruo Naito, president of IFPMA, said counterfeit medicines are a crime, and the industry is serious about tackling this problem head on.

"These criminals pose a threat to global public health: deliberately and deceitfully they attempt to pass off their dangerous products as legitimate medicines, and risk patients' lives in order to make illegal profits. This is not about commercial interest; this is about protecting patients, and we stand ready to be an active partner in WHO-led efforts, including IMPACT," he said.

Health Action International, a global patient lobby group, has expressed concern about the WHO's continued involvement in issues relating to intellectual property enforcement – particularly the IMPACT initiative.

"Despite many efforts to convince us otherwise, strengthening the rights of IPR holders is not the magic solution for much broader problems of medical products with compromised quality, safety and efficacy. As an organisation committed to promoting high standards of public health, the WHO should avoid association with initiatives that pose a threat to generic competition, divert resources away from quality control and regulation, and ultimately pose a threat to public health," the organisation said.

HAI said there are reservations about the transparency, legitimacy and conflict of interest with regard to IMPACT and WHO's engagement in the initiative "compromises its independence and its capacity ensure access to quality and efficacious medical products".

"We urge WHO to disassociate itself from initiatives, such as IMPACT, that cause it to deviate from its long history of prioritising public health over trade and IP," HAI said.

Jim Thomson, chair of the European Alliance for Access to Safe Medicines, said it is particularly worrying to see fake medicines reaching patients through the legitimate UK supply chain. This, he said, shows that "parallel imports present a way for fake life-saving medicines to reach patients".

"This is extremely dangerous because even if all the substances in the counterfeit medicines are harmless, inadequate levels of active ingredient may render treatment useless. This highlights the importance and the urgency of the work that the EAASM is undertaking," he said.

UK Liberal MEP Bill Newton Dunn said the threat to patients from counterfeit medicines has never been greater. He said EU figures show an increase in the number of counterfeit medicines seized at EU borders. "Action is needed to protect patients and I am working with the Alliance for Access to Safe Medicines to raise public awareness of this life-threatening issue," he said.

Mary Baker of the European Federation of Neurological Associations said counterfeiting is not only criminal, but also represents a very real threat to life. "At best counterfeit medicines will be ineffective and at worst they could be fatal. By working together, we can ensure that public awareness of the dangers of counterfeit medicines is raised and that patients are protected from this increasing threat," Baker said.

Greg Perry, director-general of the European Generic Medicines Association, stressed the importance of stamping out counterfeit versions of highly sought after medicines. Speaking after the European Parliament public health committee voted in favour of anti-counterfeit measures, he said MEPs were right to reinforce current audit systems and build upon greater international cooperation.

"MEPs have correctly focused measures to tackle the sale of counterfeited medicines on the Internet where the major problem lies," said Perry. "These measures provide an effective tool to prevent the infiltration of falsified APIs and excipients into the EU," he said.

Perry added that "a mandatory EU inspection and certification system for all APIs and excipients without adequate resources, which was rejected by the committee, would have led to severe shortages of medicines for EU patients and healthcare systems". 

The EAEPC, the industry body representing Europe’s parallel distributors of pharmaceutical goods, welcomed the ENVI committee vote on the falsified medicines proposal as it believes the legislation represents a step forward to ensuring the safety of the supply chain for European patients, while recognising the savings that parallel distribution brings to the European healthcare systems and the role that all authorised actors play within the legal supply chain.

Heinz Kobelt, the Secretary General, is of the opinion, as regards verification of authenticity of medicines’ packs and protecting against counterfeit medicines, that an effective system can only work when all authorised  operators are part of the system.

Moreover, he express some concern regarding some part of the proposal, relating to the prohibiting of blister cutting. Mr Kobelt  argues that the practice of re-sizing blisters is a necessity in overcoming pack size differences between European markets and adjusting parallel imported products to the dispensing norms and practices of the destination market.

Furthermore, the organisation notes that the practice itself is pharmaceutically safe and is carried out under GMP conditions by manufacturing authorisation holders. In the absence of a step forward on the topic of pack size harmonisation, the EAEPC will continue working with the EU institutions to ensure patient safety and also to safeguard the established legal EU-supply chain.

 

Timeline

  • Feb. 2006: World Health Organisation (WHO) launches International Medical Products Anti-Counterfeiting Taskforce (IMPACT).
  • Sept. 2008: WHO and Interpol begin first combined operation targeting pharmaceutical products in Tanzania and Uganda.
  • 18 Dec. 2008: European Commission proposes new directive on falsified medicines.
  • 18 Feb. 2009: MEPs criticise Commission's proposed text on counterfeit medicines for neglecting to tackle Internet sales.
  • May 2009: Egyptian police, customs and private investigators join forces under IMPACT to seize hundreds of thousands of counterfeit medicines in Suez Canal bound for Middle East.
  • 27 Oct. 2009: Medicine regulators on both sides of Atlantic warn of bogus swine flu remedies being sold online.
  • 4 Jan. 2010: European Medicines Agency (EMA) lists counterfeit and falsified medicines as priority for cooperation with EU authorities.
  • 15 April 2010: Swedish pharmacists announce positive results of industry-led barcode project designed to prevent dispensing of fake medicines.
  • 21 May 2010: European pharmacists group reports that its logo has been faked by Russian website illegally selling medicines.
  • 27 April 2010: European Parliament public health committee backs new measures against illegal sale of medicines over Internet.
  • July 2010: Full sitting of European Parliament to vote on Falsified Medicines Directive.
  • Sept. 2010: First parliamentary reading of Falsified Medicines Directive.
  • 18-22 Oct. 2010: WHO expert committee to revise guidelines on good distribution practices of medicines.