Wednesday, August 31, 2011

The Counterfeit Counterfeit Drug Count (rerun)

I’m taking a break from blogging this week and rerunning some of my favorite posts from 2010. Click here to see the original post and comments from September 2010.

Have you ever wondered about the statement that "10% of all drugs worldwide are counterfeit"?

The 10% figure has been cited by the World Health Organization (WHO), which has become the de facto source for the statistic. Just about every technology vendor involved in pharmaceutical supply chain security still touts the 10% figure as often as possible.

Alas, it turns out that the 10% figure has no factual basis in reality. Carl Bialik, the Wall Street Journal's Numbers Guy, published a fantastic piece of journalism this weekend entitled Counterfeit Drug Count Is Tough to Swallow. You should also read Dubious Origins for Drugs, and Stats About Them from The Number Guy's blog for some additional background.

The lesson? Always check the references. And don't believe everything you hear from technology vendors.

Here is a the key section from Mr. Bialik's article:
"The 10% figure appears to have surfaced initially in a 2002 editorial in the British Medical Journal, which reported that 'the World Health Organization estimates that 10% of global pharmaceutical commerce is in fakes.' The article attributed the WHO estimate to a study published in 1999 on counterfeit drugs in Myanmar and Vietnam. For the study, WHO researchers tested samples of 500 drugs, specifically selected because they were considered particularly susceptible to counterfeiting. A little over one in 10 didn't contain the labeled amount of active ingredient. But the paper made no claim about the overall counterfeiting rate in those countries, let alone world-wide...His 2002 editorial was picked up by several major news organizations, and soon 10% became a commonly accepted figure, attributed to WHO. The health agency itself included the estimate in several statements and fact sheets. The FDA, meanwhile, cited the 10% figure in a 2004 report, attributing it to WHO. Spokeswomen for both organizations say the origin of the figure is unclear.
Amazing. IBM is running a new ad stating unequivocally that "10% of the world's medicine is counterfeit, affecting over a billion people a year." Yikes! An executive at another technology vendor published an article in August claiming that the WHO estimate was "conservative." I guess scare tactics still work.

Thankfully, counterfeit drugs are still extremely rare in the United States even as the global problem seems to be growing. But the potent mix of greed and diversion still creates potential problems as I note recently regarding products stolen from GlaxoSmithKline and Shire.

My philosophy in writing this blog can be summed up with a quote from the late Senator Patrick Moniyhan: “Everyone is entitled to his own opinion, but not his own facts.” I am opposed to unsupported accusations, overwrought hyperbole, or just plain misrepresentation. Careful readers will notice that I always try to include links to source materials so that you can make up your own.

Never uncritically accept any statistic...even if you read it on Drug Channels!


  1. There is no universal definition of 'counterfeit' so this likely adds to the confusion.

  2. Drug Channels FanAugust 31, 2011

    I am enjoying the summer reruns. Have a great Labor Day - but come back with new stuff!

  3. Never fear. Drug Channels will return next week. Same bat-time, same bat-channel!

  4. Is there a good working definition of a "Closed Door" pharmacy and what qualifies as a "Closed Door" pharmacy. Can retail drug chains access "Closed Door" pharmacy status and contracts with manufacturer or must they establish a separate entity and keep retail drug inventory separate from Closed Door status. It seems to me the reason there is so much drug diversion is because a certain class of trade and purchase drug at one price for its own use while another class of trade may not purchase at such favorable pricing? Last, how would a Group Purchasing Organization enable a retailer to access "Closed Door" Pricing, which I am hearing inside the industry?

    Nick Opalich

  5. Good article, this is exactly the same reasoning behind the grossly uncorroborated statement that 5% of all trade is counterfeit. Which then causes people to do spurious calculations based on World Trade figures that can never be accurately confirmed.  Don't misunderstand me; I acknowledge that counterfeiting is a very serious issue but by trying to devise bigger and bigger numbers they think they are making a better case for combatting the criminals whereas anyone with experience in this field knows you cannot generalise and individual products should be assessed in terms of their risk (health and financial) and the benefit (cost effective) protection can bring.

  6. George PennebakerSeptember 03, 2011

    You will also find that 10% of all drug claims are fraudulent.  If someone says that they have 1,000,000 fraudulent claims you will usually find that they have 10,000,000 claims; or $10 million out of $100 million.  Or, whatever.  Obviously, it's a guess.  The only way to know is to have found ALL of them.  Then it would not be a problem because the rate would be 0.0%.