Counterfeit Drugs, One Click Away - Pharmaceutical Executive


Counterfeit Drugs, One Click Away
Purchasing medications online can expose consumers to serious risk. It's a dangerous problem we can't afford to ignore.

Pharmaceutical Executive

•establishing a means to coordinate cross-functional efforts within the company, such as a central anti-counterfeiting office.

In addition, pharmaceutical companies are encouraged to, whenever possible, participate in regional, national, and international anti-counterfeiting initiatives (such as by warning against the dangers of buying medicine online), because government and public-awareness-raising campaigns are central to the promotion of Internet-specific laws and to reducing the demand for counterfeits.

Even if pharma and the government take safety and prevention measures, the Internet will remain at the heart of stakeholder debates on counterfeiting today. One disturbing trend has been for consumers who are victims of counterfeit products (including pharmaceuticals) to sue the company whose product was counterfeited (also a victim) on various grounds, including negligence and product liability. For example, after a 2003 recall of 18 million tablets of counterfeit Lipitor (atorvastatin), Pfizer was sued for an alleged failure to monitor the distribution chain for its product. The case was dismissed since Pfizer did not participate in the counterfeit operation and had no duty to anticipate criminal tampering with its products. Amgen was sued for negligence after counterfeit Epogen (epoetin) reached patients, but ultimately settled the case in 2006. Similarly, a class action was brought against Procter & Gamble for harm that might have been caused by counterfeit hair-care products on a product-liability theory. The plaintiffs asserted that the company had a duty to warn consumers of the potential harm of counterfeits; the court dismissed the class action for failure to state a claim. Even though companies should not be held responsible for products that are not theirs, these recent cases indicate the need for pharmaceutical companies to be ready to demonstrate their commitment to protect consumers/patients from counterfeit products.

Therefore, pharmaceutical companies must continue to move beyond traditional methods of stopping counterfeiters. One important US initiative to fight pharmaceutical counterfeiting online is the draft US Safe Internet Pharmacy Act of 2007 (S. 596). That act would require each Internet pharmacy offering prescription drugs in the United States to:

•be licensed by FDA

•maintain an agent in every state where it is doing business

•post on its Web site the pharmacy's street address, telephone number, names of pharmacists, and seal

•dispense only after receipt of a valid prescription from the treating provider.

The act would also require regulations to block financial transactions from illegal online pharmacies and would grant US courts jurisdiction to order interactive service providers to remove/disable links to illegal online pharmacies. As the act is currently drafted, it is not clear who would have the responsibility or resources to enforce this remove/disable provision. Some pharmaceutical companies are seeking to amend the act in a way that would provide them a private right of action to protect their brands against online counterfeits.

The World Health Organization International Medical Product Anti-Counterfeiting Taskforce (IMPACT) acknowledges the Internet as contributing to the expansion of pharmaceutical counterfeiting. Moreover, in January 2007, the Third Global Congress on Combating Counterfeiting and Piracy recognized the need to identify solutions specific to Internet counterfeiting. In addition, the International Trademark Association is looking into the phenomenon of Internet-facilitated sales of counterfeits, and the organization is likely to produce a comprehensive analysis on the subject. It is imperative for pharmaceutical companies to take part in the debate and lobby for changes to existing law to address this real and growing problem.

Of course, all these measures may involve added resources and expanded budgets without a clear way of measuring the benefit of such an investment. Pharmaceutical executives may say, "We can't afford that." However, when considering the obvious losses in revenue and brand value—and, more importantly, the grave risk posed to the health and safety of patients such as Marcia Bergeron—the clear response is, "We can't afford not to."

Additional reporting by Chehrazade Chemcham and Jessica Parise

Mark Mutterperl is a partner in the intellectual property and technology department of Fulbright & Jaworski. He can be reached at

Bruce Longbottom is associate general counsel, trademarks and copyrights, for Eli Lilly. He can be reached at


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