Fighting Counterfeiting with Accessibility

It seems obvious, really. If pharma companies are so concerned about people buying counterfeit versions of their drugs online, why don't they make it easier for these good and vulnerable folk to buy the genuine product directly from them?  In this guest post, Miri Frankel reviews this line of thought in the light of a recent  initiative aimed at just that purpose. Miri writes:

Pharmaceutical drug counterfeiting is big business. An estimate from the World Health Organization puts annual global sales of counterfeit or tainted pharmaceutical drug products at $430 billion. Pharmaceutical manufacturers and the Medical Product Counterfeiting and Pharmaceutical Crime (MPCPC) unit of INTERPOL have a tough time catching and prosecuting global drug counterfeiting rings, which have vast networks for online sales.

With these challenges in mind, more than two dozen Big Pharma companies have announced a new partnership with INTERPOL to combat drug counterfeiting. These companies will provide nearly six million dollars (4.5 million euros) to INTERPOL’s newly created Pharmaceutical Crime Program, which is tasked with stemming the supply of fake drugs by training local law enforcement on investigative procedures geared toward dismantling drug counterfeiting enterprises.

According to a report from INTERPOL, an essential part of the programme is to raise public awareness of the dangers of fake drugs, particularly for people buying medicines online. The World Health Organization estimates that in more than 50 per cent of cases, medicines purchased over the internet from illegal sites that conceal their physical address have been found to be counterfeit.

Where fashion and medicine meet:
Hermes should never be
confused with Herpes

Typically, consumers seek out counterfeit products because the brand to which they aspire is inaccessible. In the fashion industry, this concept is realized by shoppers whose wallets are not big enough to buy the luxury goods they desire. On a nearly daily basis, new websites are launched promoting cheap (and generally fake) Gucci handbags or Prada footwear, or any other of-the-moment luxury fashion item. And the ease with which consumers can locate such products for sale online has been a boon to counterfeiters and a nightmare for law enforcement and for brands trying to protect their IP, their reputation, and, of course, their revenues.

In the context of pharmaceuticals, anti-counterfeiting is not only a matter of revenue protection, it is a matter of public health and safety. INTERPOL’s report notes that,

Counterfeit cough syrup and other medicines laced with diethylene glycol have caused eight mass poisonings around the world including in 2006 in Panama where more than 100 people died, many of them children. In 2012, some 109 heart patients in Pakistan died after taking fake medicine.

Good for hypochondria?
Fake drug websites might
yet be handy for folk with
fake illnesses, says Merpel 

In addition, in contrast to fashion goods, consumer price concerns (while relevant) often take a back seat to the embarrassment factor. As a result, a few major pharmaceutical companies are testing out programs to sell, through their own websites, certain drug products that carry social stigmas (think: erectile dysfunction, weight loss, and cancer treatments, which account for some the most counterfeited types of drugs). Consumers thus have the ability to purchase directly from the manufacturer prescription drugs for ailments they do not want disclosed to others, even if the disclosure takes the form of being spotted at the pharmacy counter. Without embarrassment as part of the equation, will consumers be willing to pay for the brand name drug now that it is legitimately available online, or will they continue to seek lower priced alternatives despite knowing that those alternatives may be counterfeit? If the digitization of the music industry has taught us anything, it is that consumer demand for product accessibility, especially online, cannot be ignored; it must be embraced in order to avoid driving consumers to counterfeit or infringing products that are more easily accessible.

It will be interesting to see how the take-it-to-the-masses approach works in combating demand for counterfeits in the patent/pharmaceutical world. Consumers, returning to the fashion industry comparison, may knowingly and unapologetically purchase lower-priced counterfeit luxury fashion goods despite knowing that counterfeit fashion goods have a direct connection to criminal activities like arms trafficking and terrorism. The connection between their illicit purchases and terrorism might seem too tenuous to be a sufficient deterrent if they view those criminal activities as far removed from their own personal lives and home neighborhoods. On the other hand, pharmaceutical drug consumers may be more adept to select accessible online offerings of the legitimate product rather than take their chances with lower-priced counterfeit products that could cause them direct physical illness and harm. 

The IPKat notes that much has been made of the failure of intellectual property creators and owners to make their products adequately accessible to consumers in the developing world, but that relatively little has been said about product access in the developed world. If better education of consumers, coupled with easier access to medicines via the original manufacturers, results in cleverer customers making better choices and staying healthier, to the detriment of the counterfeiters and traders in fakes, are we not all the winners?

Merpel says, this is all very well -- but spare a thought for legitimate middle men. Do they have a future at all in the era of internet trade, or are they no more than commercial dinosaurs, a footnote in business history?