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 increasingly available on the market through unlicensed internet pharmacies and underground platforms, posing a risk to public health. Moreover, chemical products too can be used for illegal purposes such as the manufacture of illicit drugs.
Our approach to product-related crime
Our company develops and manufactures products of the utmost quality. In order to protect both customers and patients, we secure our products against counterfeiting and are deeply committed to fighting product-related crime. For instance, we collaborate with regulatory and law enforcement agencies at the regional, national and international level. When cases of product-related crime are identified, we also cooperate with the law enforcement and public health authorities in the respective countries. In taking preventive action, we furthermore partner with representatives from Interpol and the World Customs Organization. Our guidelines, standards and processes apply to all our business sectors and markets worldwide.
What we mean by product-related crime
1. Counterfeit products: In line with the relevant WHO standard, 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 diverted from the legal supply chain (for example through theft).
2. Illegal diversion of products: This term refers to the diversion of either chemicals or pharmaceuticals from within the legitimate supply chain for illegal export, for use in the production of illicit drugs, weapons or explosives, or for any other illegitimate purpose.
3. Black market crimes: This refers to the sale of counterfeit and/or diverted products via illegal channels such as the Internet, or for illicit purposes.
4. Misappropriation of products: This refers to theft from production sites and warehouses, or while in transit.
How we are tackling product-related crime
Our Group function Corporate Security coordinates all our anti-counterfeiting activities, all of which are overseen by 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, our Group functions, and our facilities. Depending on the type, allegations are first investigated by the competent unit. In 2018, conference calls attended by all product crime officers were held every two weeks to discuss strategic matters along with local issues and suspected cases of criminal activity.
Group-wide anti-counterfeiting network
Our Anti-Counterfeiting Operational Network (MACON) is responsible for globally monitoring and executing all anti-counterfeiting measures for our products. Along with coordinating prevention and the development of security systems, this organization is also responsible for investigations. Comprised of experts from various units such as Legal/Trademarks, Product Security, Export Control, Supply Chain, Patient Safety, and Quality Assurance, this network is coordinated by our Corporate Security unit.
To investigate suspected cases, MACON collaborates with the competent law enforcement agencies and regulatory authorities. This network has allowed us to identify more cases of counterfeiting and take decisive action, especially in high-risk countries. In 2018, MACON investigated and pursued numerous incidents including theft, counterfeiting and illegal diversion in both the legitimate and illegitimate supply chain.
Our commitment: Group-wide guidelines and standards
Our Crime Relating to Products Guideline describes our goals and strategies for combating product-related crime. Our Group-wide Product Crime Investigation Standard sets out mandatory requirements and defines the knowledge sharing process within our company in an effort to provide a solid legal footing for dealing with illicit products.
Enhanced monitoring and reporting systems
We analyze and document all counterfeit product incidents using a Group-wide reporting system. This approach provides us with a complete picture of the security situation and enables us to identify possible links between different cases, thus equipping us to combat similar incidents more effectively going forward. Our standard operating procedure “Data and Documentation Quality Management” details the corresponding process and was used in 2018 to standardize and harmonize data quality and reporting across our organization.
Tracking system for chemical substances
We monitor chemicals that could be misused to produce illegal weapons, explosives or narcotics, tracking them through an internal system that flags suspicious orders or orders of sensitive products. These are only released once we have confirmed the existence of a (verified) end-user declaration.
In 2018, the integration of Sigma Aldrich into our organization substantially increased the volume of products to be monitored. In an effort to augment process safety and efficiency, we revised our internal reporting.
In addition to fulfilling the 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 honoring a voluntary commitment of the German Chemical Industry Association (VCI) and meeting the terms of the Guideline for Operators published by the European Commission.
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.
Supporting customers and patients
To protect patients, pharmacies must be able to determine the identity and authenticity of pharmaceuticals. We are therefore rigorous in meeting the requirements of the EU Falsified Medicines Directive and, accordingly, have set a goal for February 2019 to apply a unique serial number to the packaging of all the prescription medicines we commercialize in the European Union. We have already concluded the preparatory stage of implementation for 73% of our products covered by the directive. In 2018, 32% of these serialized products were in circulation. We are also transposing similar guidelines in many other countries. In the United States, for instance, we were the first company to comply with the 2018 Food and Drug Administration (FDA) product identification requirement.
In parallel to meeting these provisions, we also pursue our own initiatives:
- We apply the Security M label to some of our products, which enables users to easily verify the authenticity of our products and is considerably harder to counterfeit than commonly used holograms. We take a risk-based approach to identifying the products to be labeled in this manner.
- Using our Track and Trace system to track the serial numbers of our products, delivery points (such as pharmacies) and distributors can trace the supplier of the medicine to verify its authenticity. So far, this system has been established in the United States, the European Union, China, Egypt, Colombia, Turkey, and parts of the Middle East, with implementation in Russia still underway. Preparations are currently being made to launch Track and Trace in Indonesia and Malaysia.
- Our free Check My Meds app for smartphones allows patients in the United States and Colombia to scan the serial number of their medicines and quickly verify their authenticity.
- In our Mobile Anti-Counterfeiting System (MAS) project in Nigeria, we are working closely with one of our suppliers on a text message-based identification system. Patients scratch off a barcode that is printed on the product packaging and then send this code via text message to an assigned number. They immediately receive 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 90 different active ingredients. Used primarily in developing and emerging countries, this compact kit can detect counterfeit medicines quickly, easily and inexpensively. You can find more information on this project under Pharmaceutical supply chain.
- We offer our customers in the pharmaceutical industry Candurin® pearl effect pigments with unique color properties that make tablets and capsules more difficult to counterfeit.
In an effort to fight product-related crime, we have joined forces with organizations such as the European Federation of Pharmaceutical Industries and Associations (EFPIA), the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA), and the German Association of Research-based Pharmaceutical Companies e. V. (vfa). We also support industry-wide initiatives. For instance, we partner particularly closely with the Pharmaceutical Security Institute (PSI), a non-profit organization dedicated to protecting public health by sharing information on pharmaceutical counterfeiting and initiating enforcement actions through the appropriate authorities. We take an active role in this work through participation in PSI conferences and network meetings. Furthermore, we are a member of Rx-360, a consortium of global pharmaceutical manufacturers and suppliers that aims to prevent counterfeit products through a worldwide quality control system.
Raise awareness for product-related crime
We endeavor to raise awareness of product crime among our employees and business partners, educating our people Group-wide on the subject.
All staff involved in security, such as product crime officers, participate in onboarding and training programs aimed at building their capacities and promoting best practice sharing. We are continuously evolving these programs and adapting them to new trends. In 2018, for instance, we held 40 onboarding sessions for our product crime officers, covering product-related crime, incident reporting, case management, and cooperation with authorities.
In addition to offering training, we contributed to “Schutz vor Arzneimittelfälschungen: Regelungen zur Arzneimittelsicherheit”, a book published in July 2018 by Editio Cantor Verlag that discusses approaches to combating counterfeit drugs.
Security audits for contract manufacturers and distributors
We regularly check whether our distributors and contract manufacturers are complying with GMP and GDP (Good Manufacturing Practice/Good Distribution Practice). These audits are based on the EMA ICH Q10 pharmaceutical quality assurance standard. In doing so, we also ascertain the extent to which our security requirements are being obeyed by contract manufacturers and distributors, conducting special security audits if a concrete need is identified. Such audits are also conducted standardly when we certify external service providers for our Security M label. This applies to both pharmaceutical contract manufacturers as well as print companies that print packaging. The findings from these audits are a key factor in our decision-making process when considering potential external partners. If any critical defects are found, they must be rectified prior to us signing a deal, or a detailed corrective action plan must be submitted for our approval. In 2018, we conducted four security audits of our partners worldwide, who have since remedied the relevant defects.