Failure™ Magazine

A Prescription For Trouble

‘Dangerous Doses’ and America’s other drug problem.

Written by Jason Zasky   Filed under Life, Science & Technology

What are drug manufacturers doing to combat this problem?
First, they are getting very high tech about their packaging. They are embedding chemical markers into the packaging—and if it’s a liquid putting chemical markers in the drugs themselves, so they can do a first blush test to tell if it’s authentic. They are also using the same kind of color shifting inks that are used in the new $20 bills, as well as holograms. Of course, they have to update the overt security features continuously. Given twelve to eighteen months counterfeiters can copy anything.

What more should the manufacturers be doing?
There are two simple answers to that question. Number one is to lower prices. America has become the world’s go-to market for counterfeiters. Every counterfeiter wants to get their products into our market because we pay more for pharmaceuticals.

The other thing is to level the pricing structure. Manufacturers offer many different prices for the same drug. They give one price to drugstores, another to wholesalers, another to doctors, another for export, another for charity. There are all these discounts in the market. That is what is allowing middlemen to go in and look for these arbitrage opportunities where they can buy low and sell high. If there was a level pricing structure, then when somebody came around offering a discount on the drugs you’d suspect that person. You’d say, “Where did you get the discount, pal?” The problem with the multi-tiered pricing is that it gives everybody in the industry a cover story for buying from the little guys.

Is export diversion still a big problem?
Huge. Whenever you see a drug maker selling medicine to people in other countries at a discount, you can be almost certain that at least fifty percent of that medicine is getting turned around midstream in what we call U-boat diversion or export diversion. It’s coming back and being re-sold in our market by unscrupulous wholesalers. I have had federal officials estimate to me that fifty percent of our drug supply is diverted medicine.

What kind of legislative changes do you believe are needed?
We need to have a federal law regulating these middlemen. We need to set standards and overhaul the criminal code for adulterating drugs and falsifying pedigree papers. Also, we should require a comprehensive audit trail throughout the system.

The day “Dangerous Doses” was published Congressman Steve Israel (D-NY) held a press conference where he introduced Tim Fagan’s law [named after a Long Island teenager who received counterfeit Epogen after a liver transplant], which would overhaul the drug distribution system. That is what is needed.

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