General information on counterfeit medicines

Factors encouraging counterfeiting of drugs

А variety of factors account for why medicines are attractive for counterfeiting. Medicines are high value items in relation to their bulk and the demand for medicines is infinite. Furthermore, for the counterfeiter, ingredient costs can be very low if cheap substitutes are used or if these are omitted altogether, as is often the case. Producing counterfeit drugs may not require building huge infrastructure or facilities. They can be produced in small cottage industries or in backyards or under the shade of а tree. There are also no overhead costs due to quality assurance or meeting Good Manufacturing Practices (GMP) standards, since such standards are never implemented and gross margins are therefore very high.

А counterfeit drug has а better capacity to deceive, particularly if it is copied to make it look like the original product and if it comes from а supposedly legitimate source so that purchasers are unlikely to be suspicious. Moreover, the process by which patients get their drugs is different from that for other consumer goods: doctors or health workers prescribe them. Even when patients choose their own drugs they may lack the specialized knowledge to detect whether the product they are buying is of good quality let alone be able to detect whether the product is counterfeit. Other factors that encourage counterfeiting of medicines are discussed below.

Lack of political will and commitment

Drugs are unlike other consumer goods in that they are crucial to meeting the important objective of improving public health and so they should not be treated in the same way as other commodities.

Their development, manufacture, import, subsequent handling within the distribution chain and use require specialized knowledge and skills. Consequently, they should conform to prescribed standards and their quality should be rigorously controlled. However, this would require strong government will and commitment to establish and operate а strong national drug regulatory authority.

Lack of appropriate drug legislation

Legislation and regulations form the basis for drug regulation. Where legislation and regulations do not exist for proper control of medicines, the otherwise criminal activity of counterfeiting of medicines is not treated as а crime. Currently, only а few of the WHO member states have enacted special national legislation addressing the issue of counterfeit drugs. Moreover, sanctions imposed on counterfeiters are in most cases no deterrent. The absence of deterrent legislation encourages counterfeiters since there is no fear of being apprehended and prosecuted.

Absence of or weak drug regulation

Drugs need to be safe, effective and of good quality in order to produce the desired effect. Ensuring these properties requires the creation of а competent national drug regulatory authority with the necessary human and other resources to control the manufacture, importation, distribution and sale of medicines. At present, out of the 191 WHO member states about 20% are known to have well developed drug regulation. Of the remaining member states, about 50% implement drug regulation at varying levels of development and operational capacity. The remaining 30% either have no drug regulation in place or а very limited capacity that hardly functions. Inadequate, ineffective or weak drug regulatory control could promote unregulated importation, manufacture and distribution of drugs, leading to the proliferation of counterfeit drugs in the national market.

Inadequate resources for drug regulation activities and absence of training of national drug regulatory authorities' personnel may also manifest itself as inefficiency and incompetence of national drug regulatory authorities. The consequence of this will be infiltration of counterfeit medicines into national distribution channels.

Weak enforcement and penal sanctions

Enacting deterrent anticounterfeiting legislation alone will not solve the problem. It needs to be enforced. Where existing laws are not enforced crime is perpetuated as criminals are not afraid of being arrested and prosecuted. Lenient punishments for offences tend to encourage criminal activities such as medicines' counterfeiting, particularly when the penalties for counterfeiting non-medicinal products are more severe. Moreover, disregarding trademark rights may encourage large scale counterfeiting of drugs.

Corruption and conflict of interest

The efficiency of personnel is adversely affected by corruption and conflict of interest resulting in laws not being enforced and criminals not being arrested, prosecuted and convicted for their crimes. Governments need to develop strategies to reduce corruption. One approach could be to empower public interest and consumer groups to participate in drug regulation and to make regulatory authorities accountable and their decisions transparent.

Demand exceeding supply

In situations where demand for medicines exceeds supply, criminally minded people tend to profit out of crime by manufacturing and distributing counterfeit medicines as а substitute for genuine medicines. Also, consumers who use medicines inappropriately generate demand for such medicines, the sources of which may be counterfeit. For example, the misuse of creams containing steroids for skin bleaching and of body building medicines has generated а market for counterfeit steroid containing medicines. Often these medicines are distributed through unauthorized channels or illicit markets.

High prices of medicines

When prices of medicines are high and price differentials between identical products exist there is а greater incentive to supply cheap counterfeit medicines. People engage in the trade of counterfeit medicines because the cost of manufacture of counterfeit medicines is minimal and the profits to be made are significant.

Inefficient cooperation between stakeholders

lntersectoral cooperation between regulatory authorities, police, and customs services and the judiciary is essential for effective control of the national drug market and enforcement of drug legislation. When such cooperation is ineffective, counterfeiters can escape detection, arrest, and penal sanctions. Equally, the cooperation of the pharmaceutical industry, wholesalers, and retailers to report to the national drug regulatory authority cases of counterfeit drugs is necessary in combating counterfeit drugs. Where such cooperation is lacking the national drug authority may not be able to take measures against counterfeiters hence counterfeit medicines tend to flourish.

Lack of regulation by exporting countries and within free trade zones

Pharmaceuticals made for export are not regulated by many exporting countries to the same standard as those produced for domestic use. In addition, pharmaceuticals are sometimes exported through free trade zones where drug control is lax and where repackaging and re-labeling take place. This kind of trade arrangement can provide better opportunities for counterfeiters to introduce illicit material into the distribution chain even when the system is highly regulated.

Trade through several intermediaries

Trade in pharmaceuticals rarely takes place between the manufacturing country and the importing country. Currently, it takes place through one or more intermediate countries or trading houses. Activities in trading houses may sometimes involve repackaging and re-labeling which may be carried out without any controls under conditions that do not comply with good manufacturing practices' requirements.

Impact on public health

In most cases, counterfeit drugs are not equivalent in safety, efficacy and quality to their genuine counterparts. Even if they are of the correct quality or contain the correct amount of active substance, their production and distribution are not within the control of the drug regulatory authority of the country concerned. This means that any associated defects and adverse reactions will not be easily recognized or monitored and, if needed, an effective product recall would not be possible.

So far counterfeit drugs that have been discovered have rarely been efficacious. In many cases they have been found to be without active ingredients, or with wrong ingredients or with incorrect quantities of active ingredients. The use of such drugs can prolong treatment periods as patients may not respond as quickly as they should and exacerbate conditions being treated. Treatment with ineffective counterfeit drugs such as antibiotics can lead to the emergence of resistant organisms and may have а deleterious effect on а wide section of the population. In extreme cases, counterfeit drugs may even cause death.

As а consequence of such damaging effects, counterfeit drugs may erode public confidence in health care systems, health care professionals, the suppliers and sellers of genuine drugs, the pharmaceutical industry and national Drug Regulatory Authorities (DRAs). Incorrect labeling as to the source can also be detrimental to the reputation and financial standing of the original and/or current manufacturer whose name has been fraudulently used.

There is no simple solution or remedy that can be applied to eliminate counterfeit medicines nor can the problem be solved by an individual company or government. The problem has reached а global dimension and needs а global approach.