Panelist calls counterfeit medicines 'heinous crime'

Industry experts described threats to health and safety from counterfeit electrical and pharmaceutical products at a June 23 Newsmaker.

"This is a heinous crime," said Patrick Ford, senior director, American Region at Pfizer Inc.

He said that counterfeit Alzheimer medicines could result in faster deterioration of patients while counterfeit blood pressure medicines could threaten lives. He cited the danger to children from fake vaccines.

Tom Grace, manager of anti-counterfeiting and brand protection at Eaton Corp., displayed counterfeit circuit breakers whose failure could cause electrical fires.

"Counterfeit consumer safety products are a threat to our personal safety and could have catastrophic consequences," he said.

Ford displayed slides of drug counterfeiting plants, including one showing authentic drug bottles washed for refilling.

"The Internet enables manufacturers to sell offending products around the world," said William G. Ross, unit chief of the National Intellectual Property Rights Coordination Center of the Department of Homeland Security.

The operations are multinational, so "working these cases is a kind of wild west," he added. He said China accounts for 60 percent of counterfeit product seizures in the United States.

He contrasted the present situation with that of 20 years ago, when the counterfeit market consisted of "one milers" -- products that were obvious fakes from a mile away.

Fake designed bags for $20, he noted, fooled neither the buyer nor the seller. The counterfeits were largely domestic mom and pop operations, he added.

Now, Ross said, counterfeiting is on a different scale. According to Ross, counterfeiting accounts for $200 to $250 billion of products annually, costing 750,000 US jobs.

Panelists said most counterfeits are sold directly to consumers via the Internet, although some do get into legitimate supply chains such as drug stores.

Ford said that there are safe Web sites approved by pharmaceutical manufacturers, while warning consumers against online fraudulent marketing and calling for regulation of online pharmacies.

Consumers can protect themselves from faulty electrical products by buying from authorized sales outlets, Grace said.

The panelists called for stiffer penalties for counterfeiters, enhanced legislation and cooperation among industry, government and the public.

Distinguishing between counterfeit and generic drugs, Ford said generics were approved by the Food and Drug Administration and counterfeits were not.

The generic concept doesn't apply to electrical products, but other manufacturers could legitimately adopt technology after patents elapse, according to Grace.

Panelists also said that counterfeit products raise concerns about aviation, military and automotive safety. Grace cited evidence of counterfeit automobile brake pads.