This editorial first appeared August 26th in The Hill. Peter Leininger is an attorney and a member of the FDA and Life Sciences practice with King & Spalding in Washington. From 2012-2017, he served as an enforcement attorney in FDA’s Office of Chief Counsel.
Congress, don't bring Europe's counterfeit drug problem to the US
It’s been a tough summer for pharmaceutical supply chain security.
In early July, European authorities reported that counterfeit versions of Omnitrope, a drug containing human growth hormone, were found in France, Denmark, and Mexico. The counterfeit Omnitrope was designed to look like it was made by a large drug manufacturer, but it contained no active ingredient. Shortly thereafter, German authorities announced that a fake version of a schizophrenia drug, Xeplion, was discovered in Germany. The Xeplion was also a knock-off, mimicking packaging used in Bulgaria and Romania.
These incidents are the latest in a stream of reports about counterfeit drugs throughout Europe. The problem lies in lax security of the supply chain — distributors, middlemen and wholesalers between the drug maker and the consumer. Despite ongoing problems with the EU drug supply chain, Congress is currently considering a bill that would open the U.S. to imports from the EU and elsewhere. We can’t have a serious debate about drug importation without understanding what is going on in Europe.
The proposed legislation, introduced by Sen. Bernie Sanders (I-Vt.) in February, was in the news again July 31 after the Congressional Budget Office published an estimate that Sanders’s bill would save $6.8 billion over 10 years. Sen. Sanders touted the potential cost savings and argued that the bill “includes … safeguards and consumer protections that ensure the safety of imported drugs.”
Unfortunately, this overstates the protections outlined in the bill and ignores the realities of the counterfeit drug trade. I spent several years as a criminal enforcement attorney at the U.S. Food and Drug Administration examining the counterfeit drug trade up close. The scope of this problem is startling.
We’re in the middle of a worldwide counterfeit drug epidemic that has already impacted the U.S. In recent years, FDA has published warnings about fake cancer drugs and Botox in the U.S. supply chain. FDA has been able to limit our exposure to counterfeit drugs due to strict U.S. laws governing drug distribution, but even with those safeguards in place, phony drugs have slipped through.
Why is this happening? Weaknesses in the global drug supply chain, particularly in the EU, have created an opportunity for criminals to make a fortune sneaking counterfeits into murky wholesaling networks. The “single market” created by the EU, which allows goods to flow freely throughout member states, has certain advantages, but it is a nightmare for drug supply chain security. The EU system enables wholesalers and middlemen to legally pass drugs through countries with varying levels of supply chain protection. Wholesalers can buy drugs in Romania, Bulgaria and elsewhere, and sell them to other wholesalers throughout the EU with little oversight.
As a result, European countries that might seem like safe places to buy drugs are actually struggling to contain the surge of counterfeits. The Omnitrope and Xeplion scams are just the most recent examples. In February, German authorities found a counterfeit version of the cancer drug Votrient in the German supply chain. In 2016, a counterfeit version of the hepatitis drug Harvoni was distributed by a Swiss wholesaler. In 2015, counterfeit Viread and Humira were discovered in Germany. The list goes on. Counterfeit drugs are big business.
To make matters worse, “Canadian” internet pharmacies have plugged themselves into the EU supply chain. Those companies don’t like to admit it, but many of the drugs they sell aren’t approved for distribution in Canada. They are selling U.S. consumers drugs they cannot legally sell to Canadians. So, you could go online and buy deeply discounted Harvoni from an online “Canadian” pharmacy, but odds are, it won’t be from Canada. It might be from India or Singapore, or the EU, where counterfeit Harvoni has been floating around the supply chain.
Sen. Sanders’s proposal would legalize importation of prescription drugs that are approved for sale in Canada (unlike many drugs sold by “Canadian” internet pharmacies), and then permit the Department of Health and Human Services (HHS) to authorize importation from over 30 additional countries, including those throughout the EU and places like Turkey and Israel, if evidence demonstrates that Canadian importation “increased access to safe medications.” The bill would set up a short pilot program of importation from Canada, under highly restricted terms, and then allow internet pharmacies to scour the world for drugs to sell in the U.S.
This approach is dangerous.
The Canadian drug supply chain doesn’t resemble the European supply chain, or the Turkish supply chain, or the Israeli supply chain. Remarkably, Sanders’ bill wouldn’t require HHS to examine the differences between the drug distribution networks in these countries. In fact, it wouldn’t require HHS to examine drug supply chains at all. The bill would merely require HHS to evaluate each country’s approval process. Those are two very different things. Germany’s drug approval process is not the concern. Germany’s supply chain is the concern.
Many countries with weak drug supply chains would sail through the proposed HHS review process.
Other protections would be difficult to enforce and easy to circumvent. The bill would require foreign sellers to provide importers with paperwork identifying the source of the drugs. However, FDA can’t clean up the global drug supply chain with a paperwork requirement. Criminal organizations have developed high quality printing capabilities to produce spot-on counterfeit drug labeling. Falsifying paperwork to mask the bogus drugs would be the easy part. And what if FDA finds out that a wholesaler in Turkey falsified paperwork? Enforcement would be dependent on the foreign jurisdiction.
If Sanders’ bill became law, we’d have to brace ourselves for more reports of counterfeit drugs appearing in the U.S. And if this latest push to legalize drug importation fails, no doubt there will be another. Drug importation has been idealized for so long, our lawmakers always return to it. They need to keep in mind that the reality of drug importation would look like the counterfeit drug crisis in Europe.