Sticking it to the fake drug dealer

Stuart Fuller

One of the most frightening trends we are seeing in the brand protection market is the growth in fake pharmaceuticals and medicines. The black market consultancy Havocscope estimates the financial loss caused by counterfeit pharmaceuticals to be in the region of $200 billion annually; the most affected industry sector in the world today. 

Counterfeiters have exploited the growing trend of consumers purchasing medicines online, as well as the skyrocketing demand for drugs only available under prescription. Although counterfeiting initially focused on ‘lifestyle’ drugs – such as those to control obesity and baldness – it now targets high-value, high-demand, life-saving medicines. Since counterfeits can result in treatment failure or even death, it is essential for pharmaceutical companies to take immediate action – not only to protect their brands, but to mitigate the far more devastating issue of human loss.

According to a 2014 report by Sophic Capital, up to one million people die annually due to counterfeit drugs, whilst the World Health Organization report than more than 120,000 people a year die in Africa alone as a result of fake anti-malarial drugs, either because the drugs were substandard or simply contained no active ingredients at all.

Many drug companies do everything they can to try and prevent the fake drugs that bear their name and branding being sold online, but as fast as a website selling counterfeit medicines is taken down, another one (or even two or three) will pop up in its place. The ease by which fraudsters can register domain names and publish websites means that it's often a case of playing 'Whac-a-mole' for organisations involved in the online enforcement of the pharmaceutical industry. However, a number of the biggest names in the industry have gone back to basics to provide a new level of protection for consumers.

By combining the basics of offline protection with cutting edge technology that the digital world brings, US-based supply chain solutions company Sproxil believes it has a solution that is both scalable and cost-effective. Sproxil uses mobile technology to combat counterfeiting and increase brand equity with innovative, consumer-focused product protection and targeted marketing solutions. Pharmaceutical companies attach scratch-panel stickers to their medicines which consumers can check the code underneath the scratch panel via Sproxil's central database through a simple text message verification. They know within seconds if the drugs they have purchased are genuine or not. More than 70 drugs companies have signed up to the service since it began in 2009, with the company reporting they have verified over 28 million codes.

The concept of the combination of online and offline brand protection and enforcement isn't confined to the drug industry. Organisations such as Certilogo have been providing similar tagging solutions for some of the most famous luxury and clothing brands in the world for many years, allowing consumers to check the authenticity of products through a smartphone app.

The adoption of such technologies is certainly a step in the right direction for to protect consumers, but they need to be combined with more traditional brand protection. Unfortunately, without knowledge of the offline solutions, consumers could still unwittingly buy counterfeit goods, so the need to continue to find and remove fake and dangerous goods from rogue sellers is as important as ever. The power of consumer education, driven by the pharmaceutical industry, should never be underestimated as a first step in keeping consumers protected.