#IllicitPharmaceuticals – India and China are identified as the largest producers of counterfeit pharmaceuticals

| March 23, 2020

Ø Antibiotics, lifestyle drugs and painkillers the most targeted by counterfeiters

Ø Customs seizures include counterfeit malaria, diabetes, cancer and heart disease treatments

Ø Growth in small parcel deliveries is facilitating trade in fake pharmaceuticals

A new report released today by the European Union Intellectual Property Office (EUIPO) and the Organization for Economic Cooperation and Development (OECD) estimates the total value of counterfeit pharmaceuticals traded worldwide to be up to €4.03 billion.

Customs seizure data analysed in the study, which covers the period 2014-2016, shows that counterfeit antibiotics, lifestyle drugs and painkillers were the most frequently encountered. However, other medicines like counterfeit cancer treatment medication, diabetes treatment drugs, local anaesthetics, malaria treatment drugs, HIV treatment drugs, and heart disease medication were also seized by customs officials.

The World Health Organization, one of the sources consulted for this study, estimates that the presence of sub-standard and counterfeit anti-malarial drugs in sub-Saharan Africa can add up to 116 000 deaths annually.

This counterfeit trade is facilitated by the growth in small package shipments by parcel post or letter packets, which are more difficult for customs officers to detect. Between 2014-2016, 96% of all customs seizures of counterfeit pharmaceuticals were of postal or express courier deliveries.

EUIPO Executive Director Christian Archambeau said: “Counterfeit pharmaceuticals can pose a direct threat to health and life, and their arrival into the EU, often through small parcels and internet sales, poses a challenge for enforcers. Tackling this issue requires that the current national and EU-level co-ordination is further reinforced, and supported by global actions. India and China are identified as the largest producers of counterfeit pharmaceuticals at global level, with Singapore and Hong Kong appearing as the most important transit points in the counterfeit pharmaceutical supply chain. Companies and businesses most affected by counterfeiting and piracy are primarily based in OECD countries such as the United States, the United Kingdom, France, Austria, Germany and Switzerland.”

The report uses a relevant subset of data from nearly half a million customs seizures from international enforcement agencies including the World Customs Organization, the European Commission’s Directorate-General for Taxation and Customs Union, and the United States Department of Homeland Security.

The datasets are composed of information collected and processed by customs officers. The report also includes data from the Counterfeiting Incident System of the Pharmaceutical Security Institute (PSI), which comprises cases reported by PSI member companies of fraudulent manufacture, mislabelling of drugs and fraudulent packaging. In addition, the study draws on research from the World Health Organization, among others. The report’s findings do not cover domestically and intra-EU produced and consumed counterfeit pharmaceuticals.

Today’s report follows the Trends in Trade in Counterfeited and Pirated Goods study, released by the EUIPO and the OECD in March 2019.

Main findings

  • The total value of counterfeit pharmaceuticals traded worldwide is estimated to be up to €4.03bn ($4.4bn).
  • Customs seizure data analysed in the study, which covers the period 2014-2016, shows that counterfeit antibiotics, lifestyle drugs and painkillers were the most frequently encountered.
  • This counterfeit trade is facilitated by the growth in small package shipments by parcel post or letter packets, which are more difficult for customs officers to detect. Between 2014-2016, 96% of all customs seizures of counterfeit pharmaceuticals were of postal or express courier deliveries.
  • India and China are identified as the largest producers of counterfeit pharmaceuticals at global level, with Singapore and Hong Kong appearing as the most important transit points in the counterfeit pharmaceutical supply chain.
  • The report uses a relevant subset of data from nearly half a million customs seizures from international enforcement agencies including the World Customs Organization, the European Commission’s Directorate-General for Taxation and Customs Union, and the United States Department of Homeland Security. The datasets are composed of information collected and processed by customs officers.
  • The report also includes data from the Counterfeiting Incident System of the Pharmaceutical Security Institute (PSI), which comprises cases reported by PSI member companies of fraudulent manufacture, mislabelling of drugs and fraudulent packaging. In addition, the study draws on research from the World Health Organization, among others.

The European Union Intellectual Property Office (EUIPO) is a decentralized agency of the EU, headquartered in Alicante, Spain. It manages the registration of the European Union trade mark (EUTM) and the registered Community design (RCD), as well as carrying out cooperation activities with the national and regional intellectual property (IP) offices of the EU. The EUIPO carries out research and activities to combat IP rights infringement through the European Observatory on Infringements of Intellectual Property Rights.

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