Confiscations leap 24% as bogus-Rx sales thrive online
Posted on Sunday, June 15, 2008
Counterfeit medicines are on the rise as criminals worldwide capitalize on consumers who use the Internet to search for inexpensive drugs.
Seizures of bogus prescription medicines jumped 24 percent to 1, 513 cases in 2007, and illicit versions of 403 different prescription drugs were confiscated in 99 countries, according to the Pharmaceutical Security Institute, a Vienna, Va.-based group funded by 26 drug makers.
The $ 3 billion in counterfeit drugs seized include generic copies that violate patent laws and products that lack active chemical ingredients or contain improper dosages.
In the decade since Internet sites began selling illegal copies of Pfizer Inc. ’s erectile dysfunction drug Viagra, counterfeiters have diversified, marketing pills to treat heart disease, arthritis, asthma, AIDS and cancer, according to the institute, which has been monitoring product seizures since its formation in 2002.
Copies of 19 of the world’s 25 best-selling drugs were among those seized by industry security, customs agents and police last year, according to data compiled by Bloomberg News. They were taken at ports of entry, in free-trade zones or at illicit manufacturing and distribution sites.
New York-based Pfizer, the world’s largest drug maker, may be losing sales of $ 2 billion a year in Viagra alone, given how much of the drug’s active ingredient is produced in India and shipped abroad, said Rubie Mages, a company director of global anti-counterfeiting. Legal sales of the impotence drug in 2007 totaled $ 1. 8 billion.
“Oftentimes, the drugs that are being sold emanate from China, from Russia and from India,” said Steven Rucker, an executive managing director of Kroll Inc., a New York security firm used by pharmaceutical companies to track down counterfeiters.
Fake versions of Pfizer’s Viagra and its impotence pill competitors — Levitra from Bayer AG and Schering-Plough Corp.; and Cialis from Eli Lilly & Co. — have been traced to manufacturers in China and India.
“Our awareness of the extent of counterfeiting came about mainly as a result of Cialis,” said John Lechleiter, president and chief executive officer of Eli Lilly. “But the problem is not restricted to Cialis. We’ve seen counterfeit versions of other Lilly products emerge in markets around the world.”
Counterfeits of Eli Lilly’s top seven products, led by the antipsychotic drug Zyprexa, and more than 2 million tablets of Cialis, were seized in 800 raids around the world last year, Lilly security officials say.
Seizures in 45 countries last year found counterfeits of Pfizer’s nine best-selling drugs, including fakes of Lipitor, the cholesterol pill that accounts for one-quarter of the company’s $ 48 billion in sales.
U. S. Food and Drug Administration officials say they can’t stop the flow of illegal drugs sold on the Internet.
“There are counterfeiters circulating all over the world,” said Ilisa Bernstein, the FDA director of pharmacy affairs.
The agency can’t police all the international drug shipments referred to the FDA by U. S. Customs and Border Protection inspectors at post offices, Bernstein added.
U. S. Rep. Bart Stupak, DMich., who chairs the House Energy and Commerce subcommittee on oversight and investigations, said he has repeatedly asked the FDA if it needs new laws passed to strengthen enforcement and the agency has “remained silent.”
It is unclear how much, if any, health damage is caused by the counterfeiting. The World Health Organization says 10 percent of the drugs worldwide may be counterfeit, with more than 50 percent of the medicines that are shipped to some countries not containing the proper ingredients.
Millions of Americans buying from the Internet are at risk, said Frederick Felman, executive marketing director for MarkMonitor, a San Francisco company that helps drug makers protect their trademarks on the Internet.
While fewer than 300 online pharmacies in Canada are authorized by government agencies, more than 11, 000 fake Canadian pharmacies operate online from overseas jurisdictions, he said.
Mark Kolowich, one of the few Americans convicted of drug counterfeiting, said he sold more than $ 20 million in illegal copies of erectile dysfunction drugs and other medicines through a series of Web sites before being arrested in San Diego and pleading guilty in 2004. He served three years in federal prison in California.
“If you are on the Internet, people can’t really tell if you’re a big operator or a reputable operator... as long as you can make that Web site look pretty impressive,” Kolowich said. Information for this article was provided by Jaime Hellman, Elizabeth Lopatto and Wendy Soong of Bloomberg News.
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