The size of the pharmaceutical market, the number of drugs in short supply, and the fact that many drugs sold in the U.S. are manufactured abroad all fit into the precise formulation for the appearance of more counterfeit meds.
The FDA and Genentech, owned by Swiss drug manufacturer Roche ($RHHBY), this week warned of the discovery of fraudulent vials of the blockbuster cancer drug Avastin. The agency has sent letters to 19 physician practices in California, Texas and Illinois that are believed to have purchased the fake Avastin. The practices reportedly purchased the drugs from Quality Specialty Products (QSP), a foreign supplier that may also be known as Montana Health Care Solutions. Volunteer Distribution in Gainesboro, TN, is a distributor of QSP's products. The FDA has asked the medical practices to stop using any remaining products from these suppliers. Roche says it is still determining what ingredients are in the drug, but they do not include the active ingredient for Avastin.
A study by the American Enterprise Institute last year on drug pricing found "perhaps 15% of the global drug supply outside of advanced countries is counterfeit." That number rises in certain parts of Africa and Asia to more than 50%. The study also found counterfeit drugs sold at a mere 1% discount to the drugs they mimicked, whereas legal versions made under substandard conditions brought 20% less than official generics.
The allure for counterfeiters to make the jump to the U.S. is made clear in Avastin's financial numbers. A 400-mg vial of the med--the size that was counterfeited--costs $2,400, The Wall Street Journal reports. Genentech's U.S. Avastin sales were more than $2.5 billion last year. In a follow-up, the Journal says the FDA has investigated additional reports of other counterfeit injectables--including unauthorized versions of Herceptin, Rituxan and Neupogen--marketed to clinics and given to patients.
When you add in the desperation stemming from the short supplies of some lifesaving drugs in the U.S., the conditions for counterfeiting become ideal. Drug shortages prime the pump. Michael Cohen, president of the Institute for Safe Medication Practices, told The Financial Times the shortages have pressured hospitals to seek other ways to acquire drugs, thus raising the risk of counterfeits entering the market.
In an emailed statement to FiercePharmaManufacturing, the FDA said it is "utilizing its flexibility under the law to work with manufacturers and other stakeholders to prevent and reduce current and future disruptions in the supply of lifesaving medications." In its warning on Avastin, the agency pointed out that it was not among drugs in short supply.
Regulators around the world are beefing up efforts to stop counterfeits from crossing borders. The U.S. Justice Department has a team to prosecute counterfeit drug cases, but these efforts sometimes get complicated. Negotiations on a trade agreement between the EU and India have snagged over the contention that officials from the former have often slowed the import of legal generics from the latter by claiming that they were searching for counterfeits.
Experts point out that the problem of counterfeits entering the U.S. so far has been small, but as Tom Woods, a consultant on global development, told the WSJ, the growing volume of drug shipments has made it "increasingly difficult for us to regulate our own supply chain."