Track-and-Trace Not Enough to Halt Drug Counterfeiters

Despite recent legislation to establish a more secure pharmaceutical supply chain to deliver high quality, approved medicines to American patients, efforts to block the import of substandard, fraudulent, and counterfeit drugs remains an uphill fight. Criminals are expanding from “lifestyle” drugs to widely used anti-cholesterol and cancer medicines, attracted by huge profits and low risks from drug counterfeiting activities, noted Marcia Crosse, director for healthcare at the Government Accountability Office, testifying at a Feb. 27, 2014 hearing before the House Energy and Commerce, Oversight and Investigations subcommittee.

A main problem is that penalties for distributing counterfeit drugs are too low to spur prosecution and to deter illegal operators, explained Howard Sklamberg, FDA deputy commissioner for global regulatory operations and policy. FDA is working with other federal agencies to identify and take action against illegal operators, with a focus on fraudulent Internet pharmacy sites that sell low-cost “Canadian” medicines. But most counterfeiters end up facing charges of “misbranding” or importing “unapproved foreign-made drugs,” which carry minor fines and minimal jail terms.

Members of the House subcommittee voiced hope that the recently enacted Drug Quality and Security Act (DQSA), with its requirements for establishing an electronic unit-level track-and-trace system for prescription drugs, would help deter entry of illegal medicines into the United States. But government officials and manufacturers were skeptical.

The new drug-tracking operation may help spot fraudulent products at US borders, noted Elizabeth Jungman, director of drug safety and Innovation at Pew Charitable Trusts. And a process for “decommissioning” retired drug package serial numbers could prevent criminals from buying and reusing drug identifiers to escape detection, she added. But the program does little to prevent consumers from purchasing drugs on rogue Internet pharmacy websites, Sklamberg said, or to deter medical practitioners from obtaining unapproved therapies.

To be more effective, the system needs to provide automatic product verification with each transaction through the drug supply chain, something that is not fully required by the legislation, Jungman explained. Committee investigators also are probing the role played by online business-to-business (B2B) networks or trade boards in marketing illicit supplies of bulk active ingredients to drug makers.

Sklamberg and others recommended new legislation to strengthen penalties for marketing counterfeit or substandard medicines. But Congress is not likely to act, given its recent support for DQSA and for important drug supply chain provisions in the FDA Safety and Innovation Act (FDASIA) of 2012. However, another contaminated heparin crisis or a wave of fraudulent cancer drugs in clinics could put the issue back on the front burner.