Sustainability Report 2021

Product-related crime

TAG overview

In low- and middle-income countries as well as industrialized countries, illegal, counterfeit and substandard medicines pose a significant risk to public health. In addition, chemicals may be misused for criminal purposes, such as the manufacture of illicit drugs. We take resolute action against both of these criminal activities.

Our approach to product-related crime

Our company develops and manufactures pharmaceutical and chemical products of the highest quality. We take resolute action against product-related crime in order to protect our patients and customers from the harm caused by illegal products. For this purpose, we have implemented a Group-wide strategy, which focuses on identifying and responding to the availability of counterfeit medicines as well as ensuring the integrity of our products and supply chains. Moreover, we are committed to collaborating both with government authorities and with national and international organizations. Together, we want to tackle product-related crime and raise awareness of the issue among stakeholders as well as the wider public.

How we define 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".
  2. Illegal diversion of products: This term refers to the diversion of either pharmaceuticals or chemical substances from within the legitimate supply chain either to sell or export them through illegal channels to produce narcotics, weapons or explosives, or to use them for other illegitimate purposes.
  3. Misappropriation of products: This refers to theft from production sites and warehouses, or while in transit.
Roles and responsibilities

The Corporate Security unit coordinates our approach to tackling product-related crime on the strategic level. A cross-functional team supports the operational implementation of the strategy. The team comprises experts from various units, including Legal/Trademarks, Product Security, Export Control, Supply Chain, Patient Safety, Regulatory Affairs, and Quality Assurance. Furthermore, all our sites have product crime officers who serve as central, local points of contact and act as the interface between both local and global stakeholders, internal and external alike.

Our commitment: Group-wide guidelines and standards

Globally applicable regulations are a key part of our approach to effectively and efficiently tackling product-related crime. The Group-wide guideline entitled “Illicit Trade & Product Crime Prevention” describes our goals and measures for reducing product-related crime and minimizing its impact. Our Group-wide Product Crime Incident Management standard sets out mandatory requirements for effectively managing incidents of product-related crime.

How we are tackling product-related crime

1. Detecting counterfeit medicines and taking them out of circulation

A team of experts examines, evaluates and processes every notification we receive regarding suspected counterfeit medicines. Our response always complies with both the regulatory requirements and our own wider objectives for tackling counterfeit products.. We pro-actively conduct investigations both online and offline im order to identify and disrupt the availability of illicit products in legitimate and illegitimate channels. We document all incidents using a central, Group-wide reporting system. Moreover, we support the prosecution of criminals by working closely with the authorities. As a member of the Pharmaceutical Security Institute (PSI), we routinely share intelligence about product crime with other pharmaceutical companies.

In 2021, our internal experts examined and pursued numerous incidents including counterfeits identified within the legitimate and illegitimate supply chains as well as theft and illegal diversion.

2. Tracking system for chemical substances

We monitor chemicals that could be misused to produce illegal weapons, explosives or narcotics, tracking through an internal system that flags suspicious orders or orders of sensitive products. These are released only once we have confirmed the existence of a verified end-user declaration.

In addition to fulfilling the duties defined in the statutory provisions on export control, we also report suspicious orders and inquiries 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. In 2021, we reported 745 orders placed for relevant substances. In addition, we received seven inquiries from authorities regarding specific suspected cases that we helped to resolve. We evaluate the effectiveness of our measures for avoiding product misuse based on, among other things, the number of incidents suggested to us by the authorities and solved.

3. Protecting the integrity of our products and supply chains

We intend to ensure the integrity of our supply chains on the one hand and reduce the likelihood of illegal medicines circulating on the other hand. For this reason, we have introduced robust security measures for products and supply chains.

We fulfill the regulatory requirements on product serialization and the implementation of track-and-trace technologies as prescribed in many countries and regions. This includes clear bar coding of individual and collectively packaged products for transport so that they can be traced in the supply chain.

Using a risk-based approach, we apply our own product security features on certain products. This enables the rapid and reliable authentication of our products.

We monitor our supply chain closely and we regularly audit our distributors and contract manufacturers to ensure that they comply with our GMP and GDP standards (good manufacturing practice/good distribution practice). Moreover, we carry out special risk-based safety tests on suppliers of pharmaceutical packaging and contract manufacturers.

The security measures at some of our most important global sites are certified externally in accordance with internationally recognized standards, including requirements of the U.S. customs authority’s C-TPAT (Customs-Trade Partnership Against Terrorism) initiative, the AEO-C/S (Authorized Economic Operator) certificate of the European Union, approval as a “recognized shipper” (bV) by the Luftfahrt-Bundesamt (German Federal Aviation Office) as well as the ISO standards 28000 and 28001 regarding supply chain security management.

In addition, we are introducing a Group-wide security audit management program, which is intended to further increase transparency and the security level performance within our organization and prove our compliance with security requirements. For this purpose, we are developing key figures to support this process. These key figures will be supplemented by the existing audit management tool.

Furthermore, we sponsor global initiatives to protect patients. For instance, we support the non-profit “Global Pharma Health Fund” (GPHF), which supplies the GPHF-Minilab®, a compact laboratory used mainly in countries with inadequate access to health solutions, to test the quality of 102 different active ingredients quickly and effectively. In connection with Covid-19, two additional active ingredients were added to the Minilab’s range of methods. Currently, a total of 933 Minilabs are in use. In 2021, 41 Minilabs were delivered, all but one went to 22 countries in sub-Saharan Africa.

4. Raising awareness of product-related crime

We aim to continuously raise awareness of product-related crime among our business partners and employees, educating and training our people Group-wide on the subject to strengthen their competencies. All staff involved in security, such as product crime officers, participate in appropriate training programs. We are continuously evolving these programs and adapting them to new trends.

End-user declaration
An end-user declaration is a binding customer declaration regarding the intended use of a product.
Good distribution practice (GDP)
An EU guideline that regulates the proper distribution of medicinal products for human use.
Good manufacturing practice (GMP)
A system for ensuring that products are consistently manufactured and controlled according to quality standards. These guidelines are used in the production of medicines, active pharmaceutical ingredients and cosmetics, as well as food and animal feed.
This relates to all necessary measures and governance activities to detect, analyze, handle, and mitigate security- and crime-based threats to the company. It is integral to protecting both our employees and the tangible and intangible assets of the company.
People or organizations that have a legitimate interest in a company, entitling them to make justified demands. Stakeholders include people such as employees, business partners, neighbors in the vicinity of our sites, and shareholders.
Substances dissolved in water that are present only in minute amounts. Also referred to as micropollutants, these are synthetic substances present in concentrations ranging from one nanogram to one microgram per liter of water.


Share this page: