According to the World Health Organization (WHO), a considerable proportion of the medicines in developing countries are illegal, counterfeit or substandard. In industrialized nations, however, such products are also becoming increasing available on the market through unlicensed internet pharmacies and underground business-to-business (B2B) platforms, posing a risk to public health.
Our company develops and manufactures products of the utmost quality. In order to protect customers and patients, we are deeply committed to fighting product-related crime. For instance, we collaborate with law enforcement agencies and take steps to secure our products against counterfeiting. Our guidelines, standards and processes apply to all our business sectors and markets worldwide, thus protecting our reputation as a supplier of quality products.
Our principles
Organization and guidelines
Our Group function Corporate Security coordinates all our anti-counterfeiting activities, basing its actions on our “Crime relating to products” guideline, which describes our goals and strategies for combatting this issue. All such activities are carried out under the supervision of the Chief Security Officer and the Head of Environment, Health, Safety, Security, Quality (EQ).
Furthermore, all our sites have a Product Crime Officer who investigates potential cases of counterfeiting, acting as the interface between local regulatory and law enforcement authorities, national associations, Group functions, and our sites.
Moreover, our Group Product Crime Investigation Standard has been in place since September 2016. It defines binding guidelines, harmonizes knowledge within the company and provides a more solid legal footing when dealing with illegal products.
Fighting product crime
Our Group-wide Anti-Counterfeiting Operational Network (MACON) is responsible for globally monitoring and implementing all anti-counterfeiting measures for our products. As well as coordinating preventive measures and the development of security systems, it is also responsible for investigations. Discourse between the members of the network creates synergies and bolsters our efforts to fight product-related crime. Comprised of experts from various units such as Legal/Trademarks, Product Security, Export Control, Supply Chain, and Quality Assurance, MACON is coordinated by our Corporate Security unit. In 2015, we expanded the network to include representatives from Global Drug Safety as well as various subsidiaries. All MACON activities are now overseen by the new Global Anti Product Crime unit, created in 2016.
In all relevant cases, MACON collaborates with the appropriate law enforcement agencies and regulatory authorities, allowing us to detect more cases of counterfeiting and take decisive action in pursuing existing cases, especially in high-risk countries. The network reviews and handles up to 100 cases of product-related crime per year, including inquiries from authorities that arise during backtracking investigations. In 2015, we uncovered several underground laboratories that were counterfeiting several of our products.
Moreover, in 2016 we launched a new, Group-wide internal reporting system with which all incidents can be better analyzed and documented. This provides us with a more complete picture of the security situation, better equipping us to prevent such incidents in the future.
Fast Fact
Defining product crime
1. Product counterfeiting: In line with the Trade-Related Aspect of Intellectual Property Rights Agreement (TRIPS) and WHO standards, we define a counterfeit product as: “A product that is deliberately and fraudulently produced and/or mislabeled with respect to its identity and/or source to make it appear to be a genuine product”.
This includes products:
- with incorrect active ingredients or concentrations thereof
- without any active ingredients
- with dangerous impurities
- with modified/altered packaging and/or incorrect brand names
- with an authentic active agent, but not one produced under GXP conditions
- that have expired
- that were removed from the legal supply chain (e.g. through theft)
2. Illegal diversion of products: This term refers to the diversion of either chemical or pharmaceutical products from within the legitimate supply chain for illegal export, for use in the production of illegal drugs, weapons or explosives, or for any other illegal purposes.
3. Black market crimes: This refers to the sale of counterfeit and/or diverted products via illegal channels (e.g. the Internet), or for illegal purposes.
4. Misappropriation of products: This refers to theft from production sites and warehouses, or while in transit.
Tracking system for chemical substances
We have established an internal system to monitor and track chemicals that could be misused to produce illegal weapons, explosives or narcotics. Our tracking system flags suspicious orders and/or orders of sensitive products, which are only released once we have confirmed the existence of a (verified) end-user declaration. Moreover, we collaborate closely with regulatory authorities and law enforcement.
In addition to our duties stipulated by statutory provisions on export control, we also report suspicious orders, inquiries and requests to the competent authorities. Through these efforts, we are fulfilling our commitment to the German Chemical Industry Association (VCI) and to the Guideline for Operators published by the European Commission.
Supporting customers and patients
We believe that patients should be able to determine the identity and authenticity of a pharmaceutical product themselves, which is why we implement the requirements of the EU Falsified Medicines Directive, for instance by applying a unique serial number to our pharmaceutical packaging. In the United States, the Food and Drug Administration (FDA) requires all drug packages to be labeled with a unique product identifier by the end of 2017, which we are currently working to implement.
In parallel to meeting these international provisions, we also pursue our own initiatives:
- On all our products, we apply Security-M, a security label containing our color travel pigments. This label enables users to easily verify the authenticity of our products and is considerably harder to counterfeit than the holograms that are commonly used.
- With our Track and Trace shipment tracking system, patients can trace the supplier of the medicine to verify its authenticity. We have already implemented this system for all our pharmaceutical products in the United States and China, and are currently considering expansion to other markets.
- Our free Check My Meds app for smartphones allows patients in the United States to scan the serial number of their medicines and quickly verify their authenticity. In 2015, the trade journal PharmaVOICE listed the app among its top innovative health-focused apps and websites.
- In our Mobile Anti-Counterfeiting System (MAS) project in Nigeria, we are working closely with our suppliers on a text message-based identification system. Patients scratch off a barcode that is printed on the product packaging. They then send this code via text message to an assigned number, which immediately sends them back a response telling them whether their code is authentic.
- We sponsor the non-profit Global Pharma Health Fund (GPHF), which supplies GPHF Minilabs® to test the quality of 85 different active ingredients. With this compact test kit, counterfeit medicines can be detected quickly, easily and inexpensively in developing and emerging countries. Further information on this project can be found under Community.
- We offer our customers in the pharmaceutical industry Candurin® pearl effect pigments, which feature unique color properties that make tablets and capsules more difficult to counterfeit.
Educating our employees and business partners
We endeavor to raise awareness of product-related crime among our employees and business partners, training our employees worldwide on this subject. In the countries where we don’t have our own subsidiaries, we offer training for our business partners.
Conducting security audits
We regularly check whether our distributors and contract manufacturers are complying with GMP and GDP (Good Manufacturing Practice/Good Distribution Practice). In doing so, we also ascertain the extent to which our security requirements are being implemented, conducting corresponding security audits if significant deviations are identified. This auditing system is based on the EMA ICH Q10 pharmaceutical quality assurance standard. In 2015 and 2016, we conducted 37 security audits of our partners worldwide and subsequently provided them with the results of these audits so that the necessary corrective action could be taken.
Industry-wide exchange and collaboration with authorities
We have joined forces with organizations such as EFPIA (European Federation of Pharmaceutical Industries and Associations), IFPMA (International Federation of Pharmaceutical Manufacturers & Associations) and VFA (German Association of Research-based Pharmaceutical Manufacturers e.V.) in an effort to fight product crime. We also support industry-wide initiatives and collaborate closely with regulatory authorities and law enforcement at the regional, national and international level. We work particularly closely with the Pharmaceutical Security Institute (PSI). This non-profit organization is dedicated to protecting public health by sharing information on pharmaceutical counterfeiting and initiating enforcement actions through the appropriate authorities. In May 2015, we hosted a meeting of the PSI for the first time, at which we engaged in discussions on current trends and holistic approaches to fighting product-related crime. In 2016, our Chief Security Officer was appointed Vice Chair of the PSI Board of Directors.
Furthermore, we are also a member of Rx-360, a consortium of global pharmaceutical manufacturers and suppliers that aims to prevent counterfeit products through the introduction of global quality assurance systems and audit programs.
When cases of product crime are identified, we collaborate with the relevant law enforcement agencies and customs authorities in the respective countries. We furthermore work with Interpol, the World Customs Organization, health authorities, and our peer industry.
Reviewing our efforts
We evaluate the effectiveness of our measures according to the number of reported, investigated and solved cases, as well as their severity. Furthermore, in 2015 and 2016, we scrutinized our existing communication and information management processes to identify potential improvements, and are now making the necessary changes to optimize these processes.
Progress
New training program developed
In the 2015-2016 period, we devised a training program for all our employees in Security roles, such as Product Crime Officers. Via e-learning modules, the program aims to enhance their competencies and promote best practice sharing. In 2015 and 2016, we held ten training courses at various sites. Moreover, participants shared lessons learned during the MACON summit in Darmstadt in June 2016, which was attended by 25 Product Crime Officers from key countries.