Pharmaceutical companies are mobilising the latest security technology to fight forgery, but there is no quick fix
For their spirit of innovation, it is hard to fault the many companies across the world whose technologies help protect businesses and their customers from counterfeiters.
In the pharmaceutical field, the little and large of the corporate world rub shoulders in a constant battle against unseen but resourceful enemies who forge medicines.
Last month, for example, a new system for putting unique codes into glass, backed by European Union funding, was announced by Total Brand Security, a small London-based company. "It's like putting a passport number on the bottle," says Adrian Simmons, managing director.
Other security techniques have been developed by larger corporations. 3M, for instance, makes colour-changing films while Sun Chemical has developed distinct inks and pigments for use on packaging. Two German companies have focused on unique markings: Kurz has built special optical change effects into its holograms and Schreiner has designed digital watermarks that are visible only through a special filter.
Unfortunately, the dedication of these companies is matched by the ingenuity of the criminal minds ranged against them. "Counterfeiters have been able to copy everything, including RFID [radio frequency identification] labels," says Valerio Reggi, of the World Health Organisation's medicines policy and standards department.
The battle between the drugs industry and counterfeiters is one of the most sensitive areas in consumer protection, and is largely being played out in developing countries, which often lack the resources to counter the criminals (see below).
Counterfeiters know that the key to success is making the packaging as realistic as possible, then distributing the products as quickly as they can. "Counterfeiters will spend more time on the packaging and printing than on the pill, which is often made of chalk," says Gary Noon.
Mr Noon is chief executive of UK-based Aegate, a PA Consulting Group venture company that has developed a new approach to the problem. The scheme could represent a powerful new weapon for the pharmaceuticals industry and pharmacists to use against counterfeiters. Yet, in spite of its potential, it also highlights some of the limits of using technology to tackle this complex problem.
This autumn, the company launched a database that it wants drugs manufacturers worldwide to load with millions of unique serial numbers, each of which would match a number in a barcode on individual packs of drugs.
Using a simple scanner, the pharmacist can check the product at the point of sale to verify it is genuine and safe – that it has neither been recalled because of a defect, nor passed its sell-by date.
In order to win the battle against counterfeit products, however, any technology initiative needs to satisfy a number of criteria.
First, the technology has to be one part of a package of safety measures. Technology companies are often guilty of touting a "silver bullet" approach but, as Dr Reggi points out: "The day you standardise, you standardise for the counterfeiters, too."
In this respect, Aegate's database will complement and strengthen existing anti-counterfeiting measures used on the packaging or container. Once a pharmacist has checked that the item is genuine using the database, he or she may receive a further prompt to check the positioning and design of a hologram, adhesive tape or other marking. All these features can be repositioned and reshaped, batch by batch, for added security.
Second, the system must be cheap and simple if it is to be useful in developing countries, where the counterfeit drugs problem is at its most serious.
Mr Noon says that Aegate's system could either use a barcode or the more advanced RFID tag to carry data. Barcodes, however, are much cheaper than RFID tags, and at present are the only realistic solution if the database is to be used on low-cost generic drugs sold in developing countries.
A third issue in developing countries is the poor quality of many countries' fixed telecommunications networks, which could make it difficult to access a remote database via a landline. Mobile networks, however, have leapfrogged ahead, providing cheaper and more reliable communications in remote areas.
Mr Noon is developing a version of Aegate's service to make use of this. The system will use a mobile phone with a built-in camera and extra software installed that could be used to photograph the barcode and check its authenticity against the database. The answer would come back as a text message within seconds.
The final challenge for Aegate is to win the support of the drugs industry. Drugs companies have traditionally been wary of schemes that involve them sharing sensitive information. However, Graham Smith, chairman of the distribution group at the European Federation of Pharmaceutical Industries and Associations, believes they will be willing to co-operate with Aegate, as long as access to the database is properly regulated.
Mr Smith likens the system to the way credit card purchases are approved over the phone – a process in which several companies have access to information about transactions. "We are just using it for a slightly different purpose," he says.
Since commercial operations began in September in Belgium, Aegate has loaded on to its database several million unique barcode identities belonging to pharmaceutical manufacturers such as US-based Eli Lilly. Belgium was chosen as a launch market in part because pharmacists there already use mass-serialised barcodes to obtain reimbursement from the state for prescription drugs.
But a database that is used at point of sale in a traditional pharmacy cannot protect customers who purchase medicines on the internet from websites that conceal their physical location. These drugs are counterfeit in more than half of cases, says the WHO. Some of the websites, says Dr Reggi wryly, are "reliable suppliers" of counterfeit drugs.
And even if Aegate's database does become standard worldwide, the little and large of the anti-counterfeiting technology sector will continue to have an important role. Against such wily operators as the counterfeiters, a "belt and braces" approach will always be more effective.
The placebo effect
No one really knows how widespread drug counterfeiting is worldwide. As Harvey Bale, director-general of the International Federation of Pharmaceutical Manufacturers and Associations, puts it: "The evidence is eaten."
However, according to an analysis published last month by the World Health Organisation, a reasonable estimate for developing country markets is that between 10 per cent and 30 per cent of medicines on sale are counterfeit. It is a situation where technology alone will struggle to have much impact. Until recently, the pharmaceutical industry has been reluctant to say much about counterfeit drugs for fear of scaring patients. But in the past five years it has woken up to the need for better education and communication.
Ambivalent attitudes in some countries towards "good drug counterfeiters" have not helped. But Dr Bale says there is no such thing. Experts point out that, even if a fake drug is not dangerous, unwittingly taking a placebo for a month could have serious implications for some patients.
The new approach by the industry may reflect a sharp rise in reported incidents of counterfeit drugs in developed countries since 2000. But the numbers are still very small – less than 1 per cent of market value in most developed countries, says the WHO – and the rise may simply reflect better detection and reporting.
