Wednesday, February 15, 2012

Greedy Physicians Invite Fake Avastin Into the Supply Chain

Here’s some very scary news. Counterfeit versions of Genentech’s Avastin (bevacizumab) were discovered at 19 physician practices. See the FDA’s notice and Roche’s official statement.

The real crime? This situation was completely avoidable.

From what we know so far, these 19 medical practices knowingly purchased the fake product from a non-authorized distributor. By looking for a "good deal" outside of the legitimate channel, the physicians in charge of these practices were foolish, irresponsible, and unethical. Patiens caveo. (Patients Beware.)

Read on and see if you agree.


You know those guys on Manhattan street corners, selling Rolex watches for $30? I hate to break it to you, but those are not genuine Rolex watches.

How do I know? Because the Rolex web site lists only 5 authorized Rolex dealers in New York. See for yourself. As far as I can tell, none of these 5 operate out of a car trunk.

For Avastin, there are only 4 authorized specialty distributors for U.S. physician offices—Besse Medical/Oncology Supply, BioSolutions Direct, McKesson Specialty Care Solutions, and CuraScript Specialty Distribution. Click here to see this list on a public website. I found it with one google search.

So, why were these 19 physician practices ordering instead from Volunteer Distribution of Gainesboro, TN? The FDA reports that Volunteer sold the counterfeit products of Quality Specialty Products (QSP), “a foreign supplier that may also be known as Montana Health Care Solutions”?

If the allegations are true, Volunteer and QSP are complete scum who are happy to make a buck while patients die.


But what about the buyers at these 19 medical practices? In my opinion, they are also criminals.

Someone at these practices made a “business decision” to purchase outside of the legitimate distribution system, perhaps in search of bigger margins for the practice.

They must have known that this was wrong. Counterfeit sellers require counterfeit buyers. Who will punish the 19 practices? If we find out that a patient received the fake product, then the doctors responsible should lose their medical licenses.

This incident also inadvertently highlights the fatal flaw in track-and-trace or pedigree systems. As I wrote over two years ago in Reality Check on Supply Chain Security, pedigree laws and track-and-trace technologies only work if the buyers refuse to buy outside legitimate channels and agree to authenticate (scan) an electronic tag. There's little chance that a tag would have been read because these practices wouldn't want to alert anyone to their back-alley shenanigans. “Don't ask, don't tell” is the mantra of buyers who acquire questionable product from unauthorized channels.

Let’s just hope that the damage was contained. The FDA drolly notes: "Medical practices that have obtained unapproved products from foreign sources, in particular from Volunteer Distribution and/or QSP, should stop using them and contact the FDA."

How about: "Medical practices should stop doing dumb stuff that harms patients." When will pharmaceutical buyers learn to just say no?

UPDATE: Here's the FDA's list of medical practices that purchased from Volunteer Distribution: Letters to Doctors About Purchasing Unapproved Injectable Cancer Medications.


  1. Adam.....well said!!

  2. Dirk RodgersFebruary 15, 2012

    This is an incredible story.  Thanks for highlighting it.  I totally agree with your call for the doctors who dispensed the fake Avastin to lose their licenses.  Whoever made the decisions at these 19 practices to purchase the fakes from an unlicensed source should go to jail as well.  People who do that are criminals.  It is time to get tough with criminals who claim to be worthy of the trust of patients but then make a decision like this that is so clearly based on maximizing profit at the expense of their patients.

    The FDA's notice indicates that Avastin is NOT in a shortage at this time so no one can claim that they could not find the legitimate product from a legitimate source.  The buyers will likely claim that they didn't know that they were buying counterfeit and if they had known, they wouldn't have bought it.  Hogwash!  That's the difference between the legitimate and the illegitimate supply chains.  Legitimate drugs are in the legitimate supply chain.  Illegitimate drugs are in the illegitimate supply chain!

    Dirk Rodgers

  3. This brings to mind my thoughts on the artificial drug shortages created by shady secondary distributors who hoard injectable drugs and resell them at hyper-inflated prices.  While there are some academicians and even some in the business sector who may applaud an "ingenious" business strategy in which one controls price by restricting supply, the combination of increased consolidation of manufacturing and strict regulation of entry into the market make this practice an ethical nightmare.

    If buyers could immediately purchasing from those engaging in this supply practice, it would end immediately.  The reality is, however, that some of these medical conditions demand treatment by any means necessary.  These suppliers know this, and they are therefore successful.

    What is more disturbing, though, is that these drugs enter the secondary market via the primary market.  Whether purchased directly from a manufacturer (yes, I know that technically makes it the primary market) or through a wholesaler, someone should have noticed.  Once spec buying went away due to changes in manufacturing processes, it became much more difficult for pharmacies to buy forward large quantities of medication.  How, then, have these secondary sellers been able to corner the market on these medications in short supply?  If I can't buy forward 90 days of medication in advance of a significant price increase due to my purchasing history, how does this other situation occur?  Someone is being irresponsible and greedy, and that someone is in the primary market.  Shame on us for allowing it to happen.

  4. You were far too generous in your initial description of the physicians as being "foolish, irresponsible, and unethical." They are criminal. Most patients don't understand the mechanics of the drug supply chain and, even if they did, are not in a position to police a dispensing doctor. How awkward it would be to ask a physician, whom you trust, for a drug pedigree. As part of the tracking laws, dispensing physicians should be required to provide a pedigree to the patient, who should then be able to confirm its authenticity. Such a process could be designed into the system. 

    Fake drugs have the potential to negatively skew a legitimate drug's efficacy statistics. This is an additional implication that ought to motivate drug companies to push for pedigrees. 

  5. Adam,
    As always, thanks for adding light to a dark practice.  I just wish you'd published the list of the 19 practices.  While providing the name of the distributor we need to have the name of the practices too.  Let the consumer also deal with them!

  6. Sorry, you are wrong. These drugs didn't enter via the primary market. They are fakes. See the photos and descriptions on the FDA site.

  7. Great idea, but the names are not available, presumably because the FDA has no authority over the physicians.

  8. Anonymous2222February 15, 2012

    Great, start another round of the blame game and show how bad or greedy all physicians are in one blunt stroke. Moronic article written by a fifth grader.

  9. Adam,

    Thank you for today’s post re: Avastin.
    I would like to see these people (including Volunteer) brought before Congress and I would like to see their names on the front page of every major newspaper and featured on the nightly news.
    Absolutely unconscionable.

  10. Gee, I like to think of myself as smarter than a 5th grader. Perhaps I should withdraw my application to appear on Mr. Foxworthy's show?

    But seriously, I am quite curious to hear your defense of these physicians. 

  11. What is the price of Avastin? Is it exorbitantly priced (like so many other U.S. meds)? In my opinion, pharmaceutical companies who price gouge should be held responsible for the growing market for fake and counterfeit drugs.

  12. Why do physicians have to buy drugs for their patients?  THAT is what's wrong.  But the govt and ins companies like it this way so that, as usual, they save money by arbitrarily not paying 20-30% of claims.  Stop forcing physicians to do it this way and the problem goes away.  Of course, pharmacies are not going to part with these expensive meds before being paid for them, unlike physicians.

  13. My husband was given an Avastin/Irenotecan (sp?) combo for his brain cancer in February through May of 2008. It didn't work and his cancer took him from us in July of that year. We went every other week of those months and the costs billed to insurance were $29,*** (yes, that's over $29K) per treatment. Thank God, we only had to pay a $50 co-pay or I don't know what we would've done. So, at minimum, it cost over $232,000 for nothing. This makes me wonder if even more cancer clinics purchased these fake drugs...

  14. Sorry, I was referring to a different issue.  Hence my lead-in that "this brings to mind my thoughts on the artificial drug shortages."  In both cases, we as an industry are not only allowing this to happen, we are facilitating it.


  16. Why not let the patients buy direct from wholesalers as Amazon or mail order pharmacies. There is no need of inefficient overtly expensive pharmacists to count and disburse medicine. As far as MTM is concerned, it is just a way to squeeze the health system further by the pharmacists to help the insurers or PBMs. 

  17. Hey Dirk 

    So what do you think of patient authentication now?   As a consumer I don't trust physicians/pharmacies.  Why not offer the ability for the patient to authenticate the product?  Would prevent this or help catch this quicker.  It's like feet on the street for the FDA.

  18. Still disagree that patient authentication is the only true way to solve this?   Without it you have to trust doctors and pharmacists.

  19. Is this what you advise your pharm clients to do?  Charge the living daylights out of American purchasers - in this case doctors who probably can't get paid by govt and insurers for what these drugs cost - while they sell cheaper abroad?  It's a recipe for exactly what you're complaining about.  Even Pres Obama got elected in part because he promised to allow reimportation of meds sold by the pharm companies more cheaply in other countries.  Of course, he reneged on this so he is part of the problem too!

  20. This would definitely decrease the price, but I am worried about the quality.  A pharmacist who has opened 10 vials a week of a drug is much more likely to identify a fake than a patient who found a great deal on Amazon.

    What really needs to happen is a crop of elected officials not under the influence of big pharma with the capability of negotiating to bring down the cost and make fakes not worth the risk.

  21. Thanks for your thoughtful comment. There is certainly much more to learn about this story.

    I disagree on one important point. While secondary distributors can and do play a role in the legitimate supply chain, Avastin's limited distribution network specifically designates the channel to be: manufacturer-->authorized distributor-->physician. 

    There are only 4 authorized distributors, all of which are listed on an easily accessible web site. In my opinion, the physicians should have known not to buy from Volunteer. Ignorance is not a valid excuse when people's lives are stake. So, I stand by my accusation of the 19 medical practices. 

    As always, if the facts change, I'll change my mind.

  22. It is indeed an important point.  And I want to know and understand much more than I do now about the supply chain.

  23. That sounds like a great idea! I am sure any drug wholesaler would be happy to give you a big discount on price when your purchases are around $200 a month. Mine are around $300,000 a month, and I still barely make enough from your insurance to cover my costs, much less a profit. Most pharmacists would love to let you deal with your insurance when they deny claims or reimburse you below what it costs to acquire the medication. The ball can be in your court if you really want it too. The pharmacy doesn't have to bill your insurance for you! You can always order the medicine on-line and then submit your claims to the insurance yourself, wait 2 months for reimbursement if they do cover it, and might save yourself a bundle. My guess is you will never try it! 

  24. Stay tuned - I'm going to post a follow-up next week.

  25. If you're serious, break out the Haloperidol that you want a stock clerk to notice the difference between 5mg or .5mg, or figure out that the Ropinirole ordered for you should be Risperidone.  And while we're at it, choose between ordering that expensive Nexium year after year from the warehouse or have a pharmacist advise you strategies for getting off it.

  26. I disagree that track and trace could not have prevented this.  In a true track and trace model the manufacturer must send the serial numbers of the product sold to the distributing party. The distributing party may only possess the serial numbers and resell the serialized product to another distributor or dispensing entity.  Product entering the supply chain illegally is flagged when it is distributed or dispensed when those serial numbers are recorded - not by those performing the transactions but on an exception basis by a concerned/responsible third party.  Obviously this requires manufacturers to serialize product, distributors to receive serial numbers and verify those against actual product receipts.  Ditto for dispensers.  Additionally dispensers would be required to record the serial numbers of product dispensed.  I know the big verification database in the sky is viewed as too expensive but because those looking at the issue cannot connect the dots to understand the potential business benefits as well as the safeguards it provides the population. 

    I could go into how this could be applied to multi-dose packaging and how that could work or even if multi-dose packaging should even exist.There is a way to do this however since distribution data is a huge revenue component of supply chain participants, those participants argue in favor of "solutions" that protect their revenue streams instead of what is good for the safety of our society.Forget the politicians - they could never understand a supply chain and are more interested in listening to the solutions put forth that come with the most $$ attached.