Aegate News
Frost & Sullivan report reveals lack of industry collaboration and decisive action as biggest threats to rising levels of counterfeit drugs.
Mass serialisation identified as the key enabler in fight for patient safety
In a market where counterfeit drug sales are estimated to reach $75 billion by 2011, it is clear that drug counterfeiting is on the increase. Yet there is too much talk and not enough decisive action being taken in the industry to harness this problem, which is affecting national economies, damaging pharmaceutical brands and above all threatening patient safety, concludes a new report from Frost & Sullivan.
The report- Working Together on Mass Serialisation: Whose Responsibility is Ensuring Patient Safety, commissioned by Aegate, the patient safety communications company, reviews the steps that have been taken to try and address this burgeoning issue both from a national legislative level and via the use of new technologies. It concludes that as counterfeit medicines impact patients' health and have such a negative effect on all involved in the supply chain, a collective push towards a solution with tangible benefits for all parties is urgently needed.
The report reveals that it is mass serialisation, a process by which a unique number is assigned to each saleable unit (pallet, case or individual package of drugs) that can provide the foundation to develop a workable solution to help combat the trade in counterfeit drugs.
It is important to note, however, that the application of the mass serialisation technology alone will not make a difference. It unlocks the key to authentication processes that can validate drugs at critical points in the pharmaceutical supply chain - which can often involve more than 20 stages - enabling assurance of product quality before dispensing, and the opportunity to identify sources within the supply chain where counterfeits may have leaked in. Significantly, it provides benefits that address the needs, aims and interests of all stakeholders, as well as patient safety.
Although there are financial costs in setting up mass serialisation systems, under the right conditions pharmaceutical companies and governments stand to benefit from a secure supply chain, improved product recall, brand protection, point of sale security, and improved service to pharmacists and patients. However, with a few notable exceptions, the industry has been slow to recognise the rewards.
The World Health Organisation (WHO) and the European Federation of Pharmaceutical Industries and Associations (EFPIA) are working to encourage adoption. In addition Frost & Sullivan have identified that countries such as Belgium and Greece, who are early adopters of mass serialisation, have seen great benefits.
However, while mass serialisation provides an effective and immediately available solution, its impact will not be felt on the global stage if only embraced by individual market participants or at a country level only. In an increasingly globalised world, combined with the proliferation of the Internet, solutions to combat the trade in counterfeits must be globally applied.
The report concludes that an element of compulsion and collective action is needed by all market participants to combat drug counterfeiting and to drive interest and uptake in patient safety solutions that make use of mass serialisation. The responsibility for this ultimately rests with Governments who have the power to enact legislation.
"It is Frost & Sullivan's opinion that with the current unstoppable growth of the counterfeit drug market the industry needs to stop talking about finding a solution and start working together to put one in place. To do this successfully there needs to be an acceptance right across the supply chain of shared liability. With mass serialisation ready and accessible to make a difference now, the industry is running out of excuses for not facing up to their moral responsibilities and putting patients first," said Andrew Calvert Vice President Financial and Business Service, Europe and Africa, Frost and Sullivan.
"We applaud moves by individual stakeholders to help combat counterfeit drugs, however we support the findings of Frost and Sullivan. The industry as a whole still needs to do more to eradicate this alarming trend. We are committed to help play our role in supporting the industry, by having a workable authentication solution available now that will enable collective responsibility to be taken for the benefit of the patient," said Gary Noon, CEO of Aegate. "Aegate has patient safety at the heart of what we do."
Other key findings from the report include:
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Only three mass serialisation schemes in the pharmaceutical industry have been implemented in Europe although others are under discussion. There are no schemes yet in the US or in developing countries
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The role of the pharmacist is pivotal to the supply chain, but they are currently not sufficiently equipped to protect their patients. Mass serialisation can rectify this but it requires an industry-wide collaboration at a strategic and operational level
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Reimbursement fraud causes significant revenue losses to national governments. In France alone, unscrupulous patients and pharmacists cost the social security system between 10 and 20 million euros every year2. Frost & Sullivan has found that an increase in the willingness of national administrations to enact legislation for serialisation is due largely to a heightened awareness of this cost
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Examples from other industries highlight the serious impact that counterfeiting drugs could have if the problem is left unaddressed. Fake tyres, alcohol and toothpaste scandals have cost heavily in terms of financial, human and reputation costs
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The automotive industry is a great example of best practice where mass serialisation has been used for effective product recall management for tyres which may have been fraudulent or faulty3
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In Belgium and Turkey pharmacists can be found liable for handling fake or substandard drugs even if they do so unintentionally. The issue in Turkey is so serious that it could result in criminal prosecution4
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Pharma Market Letter; "Vast Reimbursement Fraud Exposed In France"; 16 Oct 2006; viewed 08 Apr 2008
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RFID Journal; "Michelin Embeds RFID Tags In Tyres";http://www.rfidjournal.com/article/articleview/269/1/1 ; 17 Jan 2003; viewed 17 Apr 2008
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Pfizer; "Pfizer Deeply Concerned After Discovery Of Another Batch Of Counterfeit Medicine"; http://www.pfizer.co.uk/Media/Press/2006/Pages/Pressreleaseb030806.aspx
If you request a copy of the report, email william.campbell@bbpr.com
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