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FDA Launches New Initiative to Battle Counterfeit Drugs

Donna Young

In an effort to stop counterfeit drug products from entering the supply chain and harming Americans, FDA has created a new internal task force that is exploring best practices that would strengthen the pharmaceutical distribution system, block illegal products from crossing the borders, and better alert consumers and health care professionals about a potential counterfeit product, said Thomas McGinnis, the agency’s director of pharmacy affairs.

The task force is scheduled to release an interim report in mid-September and request comments from the public. A final report is due in January 2004.

FDA’s counterfeit drug investigations have increased to over 20 per year since 2000, a sharp increase from the average 5 per year in prior years, according to the agency.

FDA has initiated 73 counterfeit drug investigations since October 1996—the majority having been in the last two and a half years—netting 44 arrests and 27 convictions, with a number of criminal investigations ongoing.

Drug counterfeiting in the United States is a “relatively rare event” and “not widespread,” the agency stated in a July 16 announcement about its new initiative. But, it added, FDA has recently observed an increase in counterfeiting activities and more sophisticated ways to introduce fake products into the drug supply system.

FDA and state agencies regulating wholesalers and medications need to consider the drug supply chain as a national security issue, said Henri R. Manasse Jr., executive vice president of the American Society of Health-System Pharmacists.

Manasse likened counterfeiting to a “form of terrorism” and said that government agencies, manufacturers, wholesalers, and health care providers have “let our guard down and disappointed the American public.”

“As Americans we have gotten extremely complacent about the integrity of the drug supply,” he said. “We view this as a Third-World problem, when in fact it is right at our doorstep.”

Drug products are too often treated as commodities in the U.S. marketplace, Manasse said, rather than products vital to the nation’s health.

“We have allowed the capitalistic spirit to go beyond rational public health policy,” he declared. “We treat these medications so much as a bag of M&Ms.”

Manasse hopes that FDA’s task force will insist that there be more transparency in the way wholesalers and manufacturers do business.

In the meantime, he added, pharmacists should demand that wholesalers verify that a product delivered to a hospital or community pharmacy is “in fact what it says the label says it is and that it has met all storage standards.”

Outside of the United States, according to FDA, the counterfeiting of pharmaceuticals is rampant. About 40% of manufactured drugs in Argentina, Colombia, and Mexico are thought to be counterfeit, and in China, about half of certain drugs are fakes.

Drug products in the United States can change hands several times among wholesalers before reaching an end user, according to FDA.

Some counterfeit drug products enter the distribution chain through unscrupulous secondary wholesalers or unlicensed pharmacies that obtain products that may not have a clear pedigree—a document that traces the sales history of the product back to the legitimate manufacturer.

Three primary wholesalers—Cardinal Health, AmerisourceBergen Corp., and McKesson Corp.—account for 90% of prescription drugs distributed in the United States and are exempt from the pedigree requirement.

Some state boards of pharmacy have complained that, when primary wholesalers purchase pharmaceuticals from secondary wholesalers, a drug product’s sales history cannot be traced, creating a gap in the distribution system.

Although FDA has called the pedigree a deterrent for counterfeiters, it has postponed enforcement of the requirement, originally scheduled to take effect in December 2000, until April 2004.

The agency stated that the delay was necessary to give Congress more time to consider whether further legislative action is appropriate.

Until FDA or Congress takes further action on the pedigree requirement issue, some states, including Florida, Nevada, and Ohio, have implemented laws and regulations aimed at stopping counterfeit or diverted drug products from entering the supply chain, said Carmen A. Catizone, executive director of the National Association of Boards of Pharmacy (NABP).

McGinnis said the task force is examining a law recently passed in Florida as a potential model for other states.

Under Florida’s law, wholesalers are required to submit to background checks, pay a $100,000 bond, and provide a contact person responsible for all transactions.

The law also makes forging drug labels or trafficking in prescription products more than $25,000 a first-degree felony.

Starting September 1, wholesalers doing business in Florida, including primary wholesalers, must provide a pedigree for 30 drug products, including epoetin alfa, filgrastim, somatropin, simvastatin, and ondansetron, that the state has identified as having a high risk for diversion and counterfeiting.

Florida is not requiring pedigrees for all drugs until July 2006.

The greatest problem with using pedigrees, FDA’s McGinnis said, is that they are generally “a piece of paper that is easily forged.”

FDA’s task force, he said, is examining new technologies, such as electronic tracking systems, that would make it more difficult for counterfeiters to falsely document a product’s sales history.

The task force, McGinnis added, is also observing projects such as the Massachusetts Institute of Technology’s Auto-ID Center, which is studying various forms of automatic identification, including radio-frequency tagging and electronic product coding (EPC) for pharmaceuticals and other products.

Ron Streck, president of the Healthcare Distribution Management Association (HDMA), a national trade association that represents pharmaceutical and health care product distributors, said paper pedigrees used by wholesalers do not deter counterfeiters and provide a “false sense of security” about the nation’s drug supply.

“If somebody can make a vial and make the labeling and everything pertaining to that vial so identical to [appear to] be authentic, what can they do to a piece of paper?” he asked.

HDMA supports the use of EPC as a solution to the pedigree problem, Streck said.

The wholesaling industry needs to adopt stronger guidelines, and states need to implement tougher standards for wholesalers, he added.

Streck said he was stunned when a Florida grand jury report issued in February revealed that there were 1400 wholesalers doing business in the state.

“We have 89 members, and they represent about 97 or more percent of all of the distribution sales of pharmaceuticals. It was kind of a shock to find out that there were 1400 licensed distributors” in Florida, he said. “I’ve got to ask, ‘What do they do?’”

HDMA is developing a set of guidelines for wholesalers that it plans to recommend to FDA and NABP, Streck said.

NABP, Catizone said, is working closely with FDA’s task force to update its model practice act, which provides states with sample language that may be used when developing state laws or board rules.

“We are going to look at existing state laws for wholesale distributors and see whether or not those need to be tightened up, and if loopholes have been created that are allowing some of these counterfeit products to come in via that source,” he said.

But Streck argued that new and stronger guidelines for U.S. wholesalers would not protect the public from counterfeit drugs that enter the country from outside the United States if Congress finalizes legislation that would allow reimportation of drug products.

“It saddens me that we are working so hard to clean up our internal system in the U.S. and then have Congress say we will open [reimportation of drugs] to 25 countries,” he said. “There is something wrong there.”

NABP is also assisting FDA’s task force in exploring various communication systems that could be used as a hot line to notify pharmacists about a potential counterfeit product “before they hear about it in the news media,” Catizone said.

Quick information flow, McGinnis said, is essential to protecting the drug supply chain.

Pharmacists, he added, have been the “eyes and ears” for FDA in detecting problems with drug products, including potential counterfeit drugs.

One of the agency’s counterfeit investigations, McGinnis said, was triggered when a pharmacist contacted a manufacturer after he noticed that a product’s vial was one millimeter different in size than what the drug company normally marketed.

“Just that call started communication and we were able to get the counterfeits fairly quickly,” he said. “So when pharmacists are putting away product, if they see something different without prior notice from the manufacturer that they are changing their package in some way, make that call, make that call.”