Sunday, June 28, 2015

‘Fake Drugs Kill More People Each Year Than Terrorism in The Last 40 years’

‘Fake Drugs Kill More People Each Year Than Terrorism in The Last 40 years’

In this article, I shall deliberate on ‘fake medicines’ that we may at times land up into buying, without any inkling that instead of curing or managing the ailments, these products can push us into serious health hazards, quite contrary to what we and our doctors hope for.
One may term these substances as ‘Counterfeit’, ‘Fake’, ‘Spurious’ or ‘Sub-standard’ drugs, or in whatever other names one may wish to. The bottom-line is that such products in the guise of drugs could precipitate very serious and life-threatening health crisis for patients. This mindless game has already become both a global and local health menace, though in varying degrees and parameters in different countries.
According to INTERPOL, large sums of money are involved with these transnational criminal enterprises. Fake drug makers, who run this deadly trade undercover, use sophisticated tools and technologies and are well equipped to operate stealthily.
Deploying requisite wherewithal, this growing threat to public health and safety needs to be addressed expeditiously by all concerned and in tandem. Curbing this menace would call for great concerted focus in approach and execution of a fool-proof strategy with military precision.
At this stage, I reckon, we should not clutter the subject by mixing it up with other commercial considerations, such as Intellectual Property (IP) related matter, for which appropriate laws and mechanisms are already in place.
CBI underscores veracity of the problem:
Under the above backdrop, a Central Bureau of Investigation (CBI) Press Release dated June 24, 2015 announced that the First Indo-French Workshop on “Combating Counterfeit Medicine” for Police Officers, Investigators and other officers was held on 23 and 24 June 2015 in New Delhi.
The event was organized in collaboration with the French Embassy; Institute of Research Against Counterfeit Medicines, France; Central Office Against Environmental & Public Health Violations, France and Central Fight Against Harm to the Environment And Public Health (OCLAESP) and was hosted by the CBI. Mr. Anil Sinha, Director, CBI inaugurated the workshop.
‘Fake Drugs Kill More People Each Year than Terrorism’:
In his inaugural address, Mr. Sinha made a startling revelation, when he said, according to an estimate of INTERPOL; fake medicines kill more people in a year than those who have died in the past 40 years as a result of terrorism.
Just a few years ago, INTERPOL reportedly estimated that while more than 65,000 people were killed in over 40 years in transnational terrorist incidents, the estimates of deaths caused by fake medicines range from tens of thousands to hundreds of thousands annually.
Quoting Ronald Noble, the erstwhile Secretary General of INTERPOL another report says, “40 years of terrorism has killed about 65,000 people, while 200,000 people died from the use of counterfeit drugs last year alone, and that’s just in China.”
Both crime and big money are involved in this life-threatening menace. Citing an example the CBI Director said, ‘One illicit online pharmacy network, which was dismantled by US authorities in 2011, managed to earn USD 55 million during two years of operations’.
In India, we have already read about the raids conducted by Mumbai FDA in April 2015 on similar unauthorized online pharmacies in the country. Following this development, the Drug Controller General of India has announced his yet another good intent to look into this issue with the help of a trade organization.
I shall also discuss, very briefly though, about problems associated with online pharmacies related to fake drugs, the world over.
More problems in the developing nations:
The CBI Director also articulated in his address, “Though the ramification of this menace is worldwide, it is more pronounced in developing and under developed nations.”
Sometime back in 2006, a study published by the then International Medical Products Anti-Counterfeiting Task Force (IMPACT) indicated that in countries like, the USA, EU, Japan, Australia, Canada and New Zealand, the problem is less than 1 percent. On the other hand, in the developing nations like parts of Asia, Latin America and Africa more than 30 percent of the medicines are counterfeits.
The above ‘Task Force’ also reported as follows:
“Indian pharmaceutical companies have suggested that in India’s major cities, one in five strips of medicines sold is a fake. They claim a loss in revenue of between 4 percent and 5 percent annually. The industry also estimates that spurious drugs have grown from 10 percent to 20 percent of the total market.”
‘Fake Drugs’ are more in countries with weak regulatory enforcement:
It has been observed that the issue of fake drugs is more common in those countries, where the regulatory enforcement mechanism is weak. India, I reckon, is one such country.
Interestingly, the Ministry of Health in India does not even recognize that fake Drugs are a growing menace in the country. This is vindicated by its latest report of 2009 on this subject.
The above report titled, “Report on Countrywide Survey for Spurious Drugs”, published by CDSCO on behalf of Directorate General of Health Services, Ministry of Health & Family Welfare, Government of India in 2009, concluded as follows:
“In view of above observations and data obtained from the manufacturers, after physical verification of all the drug samples and subsequent chemical analysis report on the representative of samples taken at random, it may be concluded that:
(i)             The extent of spurious drug in retail pharmacy is much below the projections made by various media, WHO, SEARO, and other studies i.e. only 0.046 % (11 samples out of 24,136 samples).
(ii)           Extents of substandard drugs among the branded items are only 0.1 % {Out of two thousand nine hundred seventy six (2976) unsuspected samples, 03 samples do not conform to claim with respect to Assay on chemical analysis}”
It is an irony that the drug regulators in India mostly keep demonstrating an ‘Ostrich Syndrome’ – refusing to acknowledge this menace that is blatantly obvious. They apparently believe that no health hazards due to prevalence of fake drugs exist in the country.
On the other side – many worrying reports:
Though the Government of India tends to wash its hands off on the very existence of this menace with the survey reports as above, following are just a few examples from other reports raising concerns on this critical issue in India:
  • A July 2014 ASSOCHAM report titled, “Fake and Counterfeit Drugs In India –Booming Biz” states that fake drugs constitute US$ 4.25 billion of the total US$ 14-17 billion of domestic pharmaceutical market. If the fake drugs market grows at the current rate of 25 percent, it will cross US$ 10 billion mark by 2017.
  • A May 2012 study published in ‘The Lancet’ reported that over one in three anti-malarial drugs sold in southeast Asia are fake while a third of samples in sub-Saharan Africa failed chemical testing for containing too much or too little of the active ingredient, potentially encouraging drug resistance. Around 7 percent of the drugs tested in India was found to be of poor quality with many being fake. India reportedly records 1.5 million cases of malaria every year.
  • A February 2012 report of ‘The National Initiative against Piracy and Counterfeiting’ of FICCI highlighted that the share of fake/counterfeit medicines is estimated at 15- 20 percent of the total Indian pharmaceutical market.
  • A 2011/12 report of the US Customs and Border Protection highlighted: “India and Pakistan both made it to top 10 source countries this year due to seizures of counterfeit pharmaceuticals. Pharma seizures accounted for 86 percent of the value of IPR seizures from India and 85 percent of the value of IPR seizures from Pakistan.”
DCGI intends to justify his moot point yet again:
In view of all these worrying reports and amid concerns around the quality of medicines being manufactured in India, in January 2015, the Drug Controller General of India (DCGI) proposed carrying out a nation-wide survey using methodology prepared by the Indian Statistical Institute, Hyderabad to assess the prevalence of fake and substandard drugs.
In the 2015 survey, around 42,000 locally made drug samples would be drawn from across the country throughout the rest of this year, which would include 15 therapeutic categories of drugs featuring in the National List of Essential Medicines (NLEM), 2011.
As I mentioned before, according to the DCGI this survey would “tell the world that our drugs are of quality”.
I discussed a similar issue titled, ‘Are We Taking Safe And Effective Medicines‘ in this Blog on November 13, 2013.
‘Fake Drugs’ and Online drug sales:
Before I touch upon this point and at the very outset, let me submit that in this article I shall not discuss on the merits or demerits of online pharmacies and the need of such e-outlets in India.
That said, it is now widely believed, backed by hard data that the Internet is increasingly assuming an attractive niche in the global diffusion of ‘fake drugs’.
Unlike India, some countries already support the business of legal online pharmacies by charting a transparent regulatory mechanism in place. For example in the United States all Internet pharmacies have to be licensed in the country. All their States require this. The general rule is, if an Internet pharmacy is offering to ship drugs into a particular state, they have to be licensed (but not necessarily located) there.
However, if an Internet pharmacy is shipping prescription drugs to individuals in the US from outside the US, that is absolutely illegal.
Some institutions in the US developed an accreditation system for Internet pharmacies. The official seals of these institutions, require to be posted on pharmacies’ website as a warrantee.
It is important to note that these institutions operate only at the national level and due to differences in domestic laws in different countries, it is difficult for any of them to provide customers with reliable information concerning the quality of pharmaceuticals, in general, available online.
Status of online pharmacies in India:
Although online sales of pharmaceuticals.......
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Sunday, June 21, 2015

Does The Attempt to ‘Debunk Five Big Myths About Big Pharma’ Not Reconfirm The Truth?

Does The Attempt to ‘Debunk Five Big Myths About Big Pharma’ Not Reconfirm The Truth?

Late last week while returning to India, to my pleasant surprise, I bumped into a longtime overseas friend and his wife working in the pharma industry. Incidentally, they were also traveling in the same flight with a plan to spend their vacation in India.
We both were immensely delighted spotting each other, and were trying to catch up with plethora of subjects at a break-neck speed and mostly with child-like zest. As a result, we were jumping from one topic to another, keeping many loops of discussion unknowingly incomplete.
One such rapid-fire colloquy got almost permanently interrupted with the final boarding announcement. It happened, just when he was referring to busting of some “myths about Big Pharma” by the global CEO of one of the Big Pharma constituents, recently. The article, he said before we got up, was published in the May edition of Forbes Magazine.
As I had missed this curious narrative during my recent relatively long overseas travel commitments, yesterday in Mumbai I did trace that out with the help of our “Google Guru” and went through the content of the article with interest.
‘Debunking Five Big Myths About Big Pharma’:
In the May 19, 2015 issue of Forbes Magazine, I came across an Op-Ed, titled “Debunking the Five Big Myths About Big Pharma”, written by Mr. John Lechleiter, President, Chairman and CEO of Eli Lilly and Company, whom I immensely respect as an icon of the global pharma industry.
The author in his article identified the ‘Five Myths’ as follows:
Myth1: Pharmaceutical companies exaggerate the costs of developing new medicines to justify high prices.
Myth 2: Industry does not develop most new medicines; they come from government and university laboratories.
Myth 3: Prescription medicines are the main driver of health-care cost increases.
Myth 4: Public and private health-care payers must accept and pay whatever prices drug companies charge for medicines.
Myth 5: Government-controlled pricing of medicines in other countries explains their lower health-care costs.
The article is indeed interesting, as it raises more questions than answers. This is mainly because, ‘the debunking of the Five Myths’ was done using the same old fragile arguments much often repeated by the international ‘Big Pharma Trade Associations’ and by some others as well, whom many call privately as their ‘poodles’, although I am not very sure about that.
The reason and time for ‘debunking’:
In the above Op-Ed John Lechleiter forcefully asserts:
“The Big Five Myths’ about this industry routinely poison debates, obscure genuine problems, and distort policy recommendations on healthcare. These myths have been all over the public arena again recently, and it’s time to confront them systematically.”
“The First Big Myth”:
As stated above, the Eli Lilly Chief described the first ‘Big Myth’ of ‘Big Pharma’ as follows:
“Pharmaceutical companies exaggerate the costs of developing new medicines to justify high prices.”
Arguments behind debunking the ‘Big Myth 1’:
The Chief debunked the first ‘Big Myth’ with the following argument:
“In fact: The research and development (R&D) expenditures of this industry are staggering – and since they are matters of public record there is no way and no need to exaggerate them.”
Raises more questions than answers:
Just to illustrate my point, that this article raises more questions than answers, I shall, try to explain the so called ‘debunking’ of this first of the ‘Five Big Myths’ of ‘Big Pharma’, as penned by Lechleiter.
The author seems to have missed the core narrative behind the so-called ‘Myth’ – lock stock and barrel. Whether deliberately or not, I can’t really figure that out.
The reason behind high costs of patented drug:
Even if for the arguments sake, what the author has said is accepted as a gospel truth while ‘debunking Myth 1’, experts’ discourses on the facts behind high costs of patented drugs do not just focus just on the ‘R&D Costs’, it also seriously points towards abnormally high ‘Marketing Costs’, which in many instances several times more than the ‘R&D Costs’.
Some hard facts:
An article of 6 November 2014 of BBC News, titled “Pharmaceutical industry gets high on fat profits” written by Richard Anderson, Business reporter, BBC News highlights:
Drug companies justify the high prices they charge by arguing that their Research and Development (R&D) costs are huge. On average, only three in 10 drugs launched are profitable, with one of those going on to be a blockbuster with US$1bn-plus revenues a year. Many more do not even make it to market.
But as the table below shows, drug companies spend far more on marketing drugs – in some cases twice as much – than on developing them… and besides, profit margins take into account R&D costs.
World’s largest pharmaceutical firms
CompanyTotal revenue ($bn)R&D spend ($bn)Sales and marketing spend($bn)Profit ($bn)Profit margin (%)
Johnson & Johnson (US)71.38.217.513.819
Novartis (Swiss)58.89.914.69.216
Pfizer (US)51.66.611.422.043
Hoffmann-La Roche (Swiss)50.39.39.012.024
Sanofi (France)44.46.39.18.511
Merck (US)44.07.59.54.410
GSK (UK)41.45.39.98.521
AstraZeneca (UK)25.74.37.32.610
Eli Lilly (US)23.15.55.74.720
AbbVie (US)18.82.94.34.122
Source:GlobalData
The article states that in 2013, US giant Pfizer, the world’s largest drug company by pharmaceutical revenue, made an eye-watering 42 percent profit margin. The same year, five other major pharmaceutical companies made a profit margin of 20 percent or more – Hoffmann-La Roche, AbbVie, GlaxoSmithKline (GSK) and Eli Lilly.
Why does the drug industry spend more on marketing than on R&D?
Thus, one most persistent question that is being raised by the stakeholders is: Why does the drug industry spend more on marketing than on R&D?
Quoting these facts, a November 6, 2014 article of ‘FiercePharma’, titled “New numbers back old meme: Pharma does spend more on marketing than R&D”, also pointed out that even John Lechleiter headed Eli Lilly’s marketing spending clocked US$5.7 billion, compared with US$5.5 billion for R&D. That’s a difference of 7 percent.
High marketing expenditure and increasing marketing malpractices:
Interestingly there appears to be a curious coincidences between fines paid by ‘Big Pharma’ related to alleged marketing malpractices and spiraling marketing expenditure.
As I indicated earlier in my Blog Post of December 29, 2014, the following are a few recent examples of just the last three years to help fathom the enormity of the problem on this issue and also to vindicate the point made above:
  • In March 2014, the antitrust regulator of Italy reportedly fined two Swiss drug majors, Novartis and Roche 182.5 million euros (U$ 251 million) for allegedly blocking distribution of Roche’s Avastin cancer drug in favor of a more expensive drug Lucentis that the two companies market jointly for an eye disorder.
  • Just before this, in the same month of March 2014, it was reported that a German court had fined 28 million euro (US$ 39 million) to the French pharma major Sanofi and convicted two of its former employees on bribery charges.
  • In November 2013, Teva Pharmaceutical reportedly said that an internal investigation turned up suspect practices in countries ranging from Latin America to Russia.
  • In May 2013, Sanofi was reportedly fined US$ 52.8 Million by the French competition regulator for trying to limit sales of generic versions of the company’s Plavix.
  • In August 2012, Pfizer Inc. was reportedly fined US$ 60.2 million by the US Securities and Exchange Commission to settle a federal investigation on alleged bribing of overseas doctors and other health officials to prescribe medicines.
  • In April 2012, a judge in Arkansas, US, reportedly fined Johnson & Johnson and a subsidiary more than US$1.2 billion after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.
Where does most of the marketing expenditure go?
On February 11, 2015, an article published in the ‘The Washington Post’ titled, “Big pharmaceutical companies are spending far more on marketing than research”, stated:
“Most of this marketing money is directed at the physicians who do the prescribing, rather than consumers.”
The HBO video that had gone viral:
The HBO Video with a dash of characteristic British humor of “John Oliver: Marketing to........
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