A Perfect Storm for Counterfeiters?

Traditional methods of brand protection, such as security packaging, are valuable—but on-dose protection is also needed.

By Dean Hart

In 2008, 3 million people in the United States lost their jobs. Even with the recently approved economic stimulus package, analysts project that an additional 3 million jobs are at risk in 2009. And the United States is not alone in its pain from economic woes—it was recently announced that experts believe at least

Dean Hart

1 million jobs are at risk in the European Union this year as well.  Virtually every part of the world is experiencing an economic downturn resulting in families evaluating every dollar spent. Under scrutiny are all nonessential needs. But the one essential that is  beyond scrutiny is the medication that many of these unemployed individuals and their family members need.

The reality of diminished income combined with the essential need to continue medications results in an environment where patients search for more economical sources for medications. Concurrently, deadlines for required brand protection initiatives, such as California’s e-pedigree legislation, have been pushed back at least six years for implementation, resulting in little strength behind brand-security efforts such as RFID and mass serialization that require involvement of the entire supply chain to be effective.

The unfortunate combination of restricted income, essential need, and the delay in brand protection mandates equates to a “Perfect Storm” for counterfeiters and illegal diverters. There has perhaps never been a better time in the history of the present-day pharmaceutical market for counterfeiters and diverters to ply their trade. The U.S.-based Center for Medicines in the Public Interest (CMPI) expects counterfeit drug commerce to increase 13% annually through 2010, which is nearly twice the rate of legitimate pharmaceuticals. This growth in counterfeit medications will generate $75 billion in revenues—a 92% increase from 2005.

In this threatening environment, pharmaceutical manufacturers need to establish strategies that have an immediate impact in combating criminals. These criminals not only affect patient health and well-being but also tarnish the reputation of safety and quality that manufacturers have worked so hard to achieve.

Manufacturers have traditionally focused on securing product through on-package technologies. However, while these generally overt solutions provide a strong first level of defense, the significant profits available have given counterfeiters strong motivation to replicate virtually all elements of pharmaceutical packaging including boxes, bottles, and even blister packaging. Often, the “fakes” are so convincing that only those responsible for product packaging can detect the subtle differences, which further adds to the deception of supply-chain partners, healthcare professionals, and patients.

In addition, most if not all on-package brand protection technologies become ineffective when a product is repackaged. This process occurs the vast majority of the time in the U.S. pharmaceutical supply chain and remains supported by the EU in the environment of parallel trade. 

With the most important participant in the supply chain being the patient, on-package brand protection being less than a total solution, and the downstream supply-chain technology and informatics needed to make e-pedigree initiatives a reality years away, on-dose brand protection technologies are required for manufacturers to protect the supply chain from plant to patient.

The pharmaceutical supply is under attack by unscrupulous individuals who seek to profit with complete disregard to the health of patients. Ultimately, it is the manufacturer’s product and the health of the patients they serve that are most at risk. As such, manufacturers shoulder the burden to implement protective measures that thwart counterfeiters and diverters, protect patients, and thereby raise the pharmaceutical supply chain to a higher level of integrity and confidence. Manufacturers must also realize that the enemy in this war is highly motivated, connected and resourced. Traditional methods of brand protection, while still valuable, are waning in benefit. It is a new-age battle that requires manufacturers to fight with everything at their disposal, including state-of-the art technologies that protect the integrity and therapeutic benefit of each and every dose.

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