Wednesday, September 03, 2008

Counterfeits at Medicine Shoppe Pharmacies?!?

This morning, I speculated that track-and-trace momentum could slow down unless there is a compelling trigger event, such as counterfeits discovered in a retail pharmacy.

A few alert readers pointed me to an FDA notice from August 8, 2008, regarding “expired and suspected counterfeit prescription drugs found at pharmacies.” Yikes! I wonder if the news will hinder Cardinal Health’s (CAH) efforts to sell its Medicine Shoppe franchise.

According to the FDA website:

”The U.S. Food and Drug Administration is warning consumers who filled prescriptions at The Medicine Shoppe pharmacies located at 8035A Liberty Road and 5900 Reisterstown Road in Baltimore that they may have received drugs that were either expired or suspected counterfeit. The FDA is particularly concerned because a number of the drugs are for serious diseases and could have an adverse effect on treatment.”

Read more at FDA Warns Consumers About Potential Problems at Two Baltimore Pharmacies

17 comments:

  1. Calm down, Adam. In your usual rush to judgement regarding the appearance of even the slightest negativity regarding retail pharmacy, you evidently failed to read the entire FDA warning.
    Here is a portion:

    "The FDA has no evidence that any other Medicine Shoppe pharmacies outside of the 8035A Liberty Road and 5900 Reisterstown Road facilities are involved".

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  2. Adam was not unclear either. Any pharmacy caught brings into question every pharmacy! As a consumer I am very concerned. 99.99% sounds great unless YOU are that .01%.

    To NOT have pedigree AND serialization is ludicrous. Cost is not the issue, profits are. Why a manufacturer would not support at LEAST pedigree is beyond my ability to comprehend. Consumers need to rise up and demand pedigree and serialization and hold anyone caught with less than perfect drugs to the maximum legal sanctions possible.

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  3. You do realize this is a random check. Imagine if they checked 100% of all drugs. They would find more.

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  4. Pedigree and serialization cost money and PBM/Insurance/Employers are the ultimate payors and they will not pay for it. Truth !!!!

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  5. The FDA should update the information about this case as soon as it can determine if counterfeits are involved. Their statement was that "either expired or suspected counterfeit" drugs were found. There is a wide distance between expired and counterfeit drugs. The businesses involved are under a cloud of suspicion and the public anxiety is raised until the FDA can tell us if the "suspected counterfeits" were really counterfeits. To leave it hanging like this does a disservice to everyone.

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  6. We all appreciate you keeping us abreast. Since you are so in tune, how do you feel that over 300 Manufactuers or particpants from the industry posted business plans to the CaBOP bill board before the decison to delay to 2011? In each of those business plans they articulated strategies and committments to meet compliance by 1/1/2011 if the board would delay for 2 years. If probably 90% of the revenue of the industry made this commettment to CaBOP why would the board ever support Ridley Thomas? If this didn't reak of ugly lobbiest and backroom deals why would Ridley Thomas modify the legislation to 2015.
    I guess the board just doesn't care about patient saftey today as much as they did on 3/24/08. You know as well as anyone pedigree wihtout serialization would solve 90% of the problem and be a good foundation to build on. Pedigree is inexpensive and easy to implement. Serialization could be phazed in " Risk Based Approach" the serial number is just a data element of the pedigree?
    I would like to hear you sound off on some of these obvious cures to many of us.

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  7. I agree the legislation was bought by the pharma lobbyist.

    BTW- Pharma companies can afford to protect the supply chain with out increasing the costs. What if they reallocated the lunches, dinners, pens, trinkets,etc to pay for serialization/pedigree. Pharma spends over $22 billion in marketing. Ever talk to a drug rep who is on a team of 5 reps doing the same thing. One of the reps is doing all the work while the other 4 act like they are doing something. They could trim head count there to pay for serialization/pedigree.
    They do not do this since they believe shareholder value and low operating costs is better. Trinkets, lunches, etc. have an immediate ROI on top-line sales. This is about the numbers and shareholder value not about the patient/consumer.

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  8. There are number of counterfeit drug cases going on, but for some odd reason they get little press. I guess our media is selective until it becomes a bigger issue. I think this is big if you are the patient taking the fake medications or the pharma company missing out on profits.

    Albers gets five years’ probation in counterfeit drug case
    By DAN MARGOLIES
    The Kansas City Star
    A federal judge today sentenced former Kansas City pharmacist Doug Albers to five years of probation nearly two years after he pleaded guilty to selling counterfeit and misbranded drugs.

    Citing his cooperation with the government and his good character, U.S. District Judge Ortrie Smith declined to impose a prison sentence or to order Albers to pay restitution.

    Rather, he ordered Albers, 57, to serve five years of probation on each of the two counts to which he pleaded guilty. The sentences are to run concurrently.

    Albers had faced up to six years in prison.

    In October 2006, Albers, formerly the principal of Albers Medical Distributors Inc. in midtown Kansas City, admitted that he sold two boxes of counterfeit and misbranded Neupogen, a drug that boosts white blood cells, in 2001.

    The Food and Drug Administration had issued a counterfeit/misbranded notice concerning the drug a few months earlier. Albers acknowledged that he failed to heed the government warning and that he failed to ensure that he was buying the drug from a Missouri-licensed broker.

    His guilty plea grew out of a larger, wide-ranging case involving the 2003 recall of millions of counterfeit versions of Lipitor, the popular cholesterol-lowering drug manufactured by Pfizer Inc. The counterfeit drugs were all but indistinguishable in appearance from the genuine product but did not have its chemical composition.

    So far, the case has led to the convictions of about two dozen defendants, with sentences ranging from a few months to 13½ years. Federal prosecutor Gene Porter, who oversaw the investigation, said Albers’ cooperation had helped convince many of the defendants to plead guilty.

    Prosecutors did not charge Albers with conspiring with the other defendants. Rather, they said, he turned a blind eye to the fact that the drugs he acquired through a broker, OTS Sales of California, were counterfeit and misbranded.

    OTS handled all the purchases and sales of Albers Medical Distributors, with the two companies splitting the profits.

    In a brief statement to the court this morning, Albers apologized for his involvement in the case.

    “I can’t adequately express my frustration, disappointment and anger,” he said before a courtroom packed with dozens of family members, friends and well-wishers. “…I have disappointed many by not doing more than I did.”

    Prosecutors accused Albers of continuing to do business with OTS even after receiving warnings from Missouri regulators that he was acquiring drugs from out-of-state distributors who were not licensed to ship prescription drugs to Missouri.

    Albers’ attorney, Jeff Morris, told the court that Albers made every effort to comply with the law but was defrauded by OTS, which deliberately deceived him about its activities.

    In November, the owner of OTS, Paul Louis Kriger of Thousand Oaks, Calif., was sentenced to four years in prison after pleading guilty to participating in a conspiracy to sell stolen drugs.

    Smith received dozens of letters, including one from the dean of the pharmacy school at the University of Missouri-Kansas City, urging leniency.

    As part of his guilty plea, Albers earlier agreed to forfeit $500,000 to the government and to surrender his pharmacy licenses in Missouri in Kansas. Albers Medical Distributors has ceased doing business.

    Albers also formerly owned a drug store, Albers Medical Pharmacy at 4400 Broadway, which was not implicated in the criminal charges. He sold the pharmacy to two of his one-time employees, who have kept the pharmacy’s name.

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  9. Adam was not unclear either. Any pharmacy caught brings into question every pharmacy! As a consumer I am very concerned. 99.99% sounds great unless YOU are that .01%.

    To NOT have pedigree AND serialization is ludicrous. Cost is not the issue, profits are. Why a manufacturer would not support at LEAST pedigree is beyond my ability to comprehend. Consumers need to rise up and demand pedigree and serialization and hold anyone caught with less than perfect drugs to the maximum legal sanctions possible.

    sounds great. will you pay 5 or even 10$ more for your rx every month to pay for it? no? well there is the problem. no one else(retailers, wholesaler, pbm, manufacturer) wants to pay for it either.

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  10. You do realize the pharma/distributors would see operational efficiencies as they serialize product. There is a ROI in the future with chargebacks, recalls, returns, manufacturing efficiencies. They really do not need to raise the cost of product, since PHARMA as a whole is cutting back on pens, trinkets, and dinners to doctors. They could reallocate the money spent on marketing and spend it on serialization and start promoting a secure supply chain. BTW- pharma is losing billions of dollars in sales to counterfeits. Online sales of counterfeits is $13 billion. WHO says $75 billion by 2010. Right there is your ROI- increase in sales.

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  11. Adam: This may be an interesting reference on the FDA website (dated 2001):
    http://www.fda.gov/oc/pdma/report2001/attachmentg/toc.html
    Note section 1.6.2 on recalls discussing lot control. Perhaps federal good distribution practices mandating lot control, lot reconciliations and lot level ePedigrees can finally start supply chain accountability. Must've missed the section in Dangerous Doses where Pharma trinkets and pens provided the incentive for trading partners to pass bad products. I also need someone to explain how Track & Trace will resolve the estimated $13 billion in internet sales. Hmmm Ebay buyers with a EPCIS portals?

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  12. Regarding the post stating "You do realize the pharma/distributors would see operational efficiencies as they serialize product. There is a ROI in the future with chargebacks, recalls, returns, manufacturing efficiencies. " While these look promising on the surface, particularly to technology providers and their VC backers who are trying to figure out how to get cents back on their dollars invested, no one has shown that serialization is the best investment to address pharma's most pressing problems. Sure, if you are trying to make the case for the added value of serialization if it is required, these benefits may be of interest to pharma executives. However, since serialization is not required of pharma, there are many other far more effective ways for pharma companies to invest, or not invest hundreds of millions of dollars. Now if somebody can show that serialization is the best business investment to solve the true problems of pharma companies like Pfizer or Merck, I am sure they could make a lot of money...

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  13. anonymous said.. Must've missed the section in Dangerous Doses where Pharma trinkets and pens provided the incentive for trading partners to pass bad products.

    You must have misread the comment. Pharma will spend $22 billion on marketing. Giving useless pens/trinkets/lunches to medical staff since there is a ROI to increasing sales.

    The remark was not saying the pens increase counterfeit drugs in the supply chain. The point is companies could reallocate the money and make the drugs safe versus going against every principal in medicine. Medicine is not marketing it should be based on evidence based medicine (outcome data).

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  14. I also need someone to explain how Track & Trace will resolve the estimated $13 billion in internet sales. Hmmm Ebay buyers with a EPCIS portals?

    What if consumers log on to the thing we call the internet and verify the product is authentic? Most consumers want to save money but will not go for the cheaper option if it's counterfeit. Maybe I am wrong, but doubt it.

    It's crazy other industries are seeing the efficiencies of track and trace, but everyone wants to deny it. Even the big oil companies and retailers are doing it.

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  15. I am not saying I'm against some sort of system, but it's not as easy or as affordable as some posters think, because they're thinking primarily of branded drugs. But when over 50% of your scripts are now filled with generics, there are two sides of the equation to consider.

    The costs associated with pedigree, RFID track/trace and serialization are more bearable when you are talking about branded drugs that are selling for large dollars (and the companies have the supposed "trinket" and personnel budgets that one poster advocates reallocating.) But when you start talking about generic drugs, many which are selling to the pharmacies at $2.00 - $3.00 per 100 or less, RFID and serialization starts to have more serious impacts to profitability and therefore sustainability of marketing the item. If you are a large generic manufacturer with a huge product portfolio, maybe some of the loss on one product can be offset by other products you sell that have a higher dollar value and you can rationalize the product line as a whole. But smaller manufacturers with a limited product lines have less options on where to absorb the costs, and may be forced out altogether. Keep in mind that it's the availability of numerous generic competitors that are driving down the costs - start driving out the competition, and costs will go up which does affect the patient/consumer.

    Adding RFID tags to every bottle and the significant costs for system implementation for serialization and pedigree has a substantial financial impact. And like other posters have said - no one down the stream is willing to pay for it - the manufacturers are expected to bear all the costs.

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  16. Even low margin business (i.e. fresh produce) have even taken a harder look at serialization and traceablity due to food safety.

    It took months to find out the source.

    There are a number of companies embracing the technology versus waiting for legislation since they see the value. Not sure why everyone does not see it or does not want to give the technology a chance to mature.

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  17. http://abcnews.go.com/TheLaw/story?id=5796287&page=1

    Wonder why companies don't want to protect their brands?

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