Guest Voices: Transparency Needed to Combat Counterfeit Drugs
Gartner Inc.’s Andrew Stevens writes that supply-chain providers must find solutions to the $200 billion business of pharmaceutical counterfeiting
Pharmaceutical counterfeiters have grown sophisticated at mimicking packaging, seals and other elements of the supply chains. Here, a technician at the Serum Institute of India Ltd. inspects vaccine vials for defects. PHOTO: BLOOMBERG NEWS
Counterfeit pharmaceuticals pose a serious threat to patients all across the world. In some regions, counterfeits can make up as much as 30 to 50% of all drug products in circulation, and some believe this might even be an underestimate. The total estimated value of the counterfeit drug market globally is $200 billion.
Counterfeiters are becoming increasingly sophisticated not only with the drugs themselves, but with the packaging, security seals and bar codes. They even can mimic IT verification web portals used by manufacturers.
Global regulators have started to act after decades of discussion and debates, with momentum finally gathering pace. Regulations recently passed in countries including Argentina, the U.S., Brazil, China and Turkey have started to place mandates across multiple supply-chain stakeholders, including requirements for connectivity between participants in the supply chain and greater transparency for patients and consumers.
Manufacturers and supply-chain service providers, as well as consumers of the pharmaceutical products, have opportunities to help shape the future direction of these laws and the infrastructure of the technology. The aim is to move to global operating models that have integrated, common modes of operation and use defined industry standards.
An important part of this process is track-and-trace and product authentication.
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Track-and-trace and product authentication involve tracking a product across the entire supply chain by maintaining a recordable chain of custody, either manually or electronically. Depending on specific legislation, track-and-trace can involve many participants in the supply chain, each of which has to work across several interactive networks.
Product authentication is part of a broader verification process, the sole purpose of which is to authenticate “genuine” products to distinguish them from counterfeit. A lot of product authentication is executed through the use of mobile technologies. However, product authentication doesn't provide traceability or ensure the complete chain of custody of a product remains secure.
The fragmented and diverse nature of regulation still presents many challenges for supply chain and logistics leaders, as does the fact that many countries still haven't established clear regulations.
In higher-risk regions such as Africa and parts of Asia, manufacturers working with logistics providers have taken responsibility to protect patients and their own revenue streams from potential threats. They are developing innovative solutions that allow patients to verify product authenticity.
These developments are helping shape and determine the direction of future regulation. Education and awareness of counterfeit drugs, and the measures and solutions being deployed to prevent them from entering the supply chains, is also a significant challenge to adoption of more stringent standards.
Those seeking stronger attention to counterfeit pharmaceuticals also face a challenge in raising the visibility of the issue across the wider medical world. Securing the pharmaceutical supply chain requires investment, and although that investment can provide a strong financial return to manufacturers and distributors it is a complex issue for supply chain leaders to communicate to C-level executives who try to make such decisions based on clear, straightforward potential for returns.
It isn’t just the pharmaceutical industry that is taking an interest in the emerging best practices and supply chain innovation that is occurring through track and trace. Other industries that are closely observing emerging best practices include tobacco, food and beverage, cosmetics and high value consumer goods companies.
Product integrity, quality and full end-to-end supply chain traceability are no longer a “nice to have” but becoming a prerequisite for both industry and consumers alike.
