Fake Medicine Lurks on Consumer Shelves

To international drug companies, the pills and capsules at neighborhood pharmacies may one day prove to be ticking time bombs.

Their general consensus is that the counterfeit pharmaceuticals market in Korea is growing rapidly.

So far, no deaths have been linked to fake drugs in Korea, but suppliers say patients increasingly risk playing Russian roulette with their lives if a major crackdown and constant vigilance does not occur.

"The easy availability of counterfeit drugs in Korea is a matter of great concern. Not only does it affect business of genuine pharmaceutical companies, but more importantly it could lead to adverse impact on health of the people," said Andrew Whitehead, the Korea head of Schwarz Pharma AG, a German pharmaceutical.

The World Health Organization defines counterfeit drugs as those sold under a product name without proper authorization.

"Counterfeiting can apply to both brand name and generic products, where the identity of the source is deliberately and fraudulently mislabeled in a way that suggests that it is the authentic approved product. They may include products without active ingredients, with an insufficient quantity or wrong active ingredients which may be hazardous, or with fake packaging," the WHO definition states.

Upwards of 10 percent of drugs worldwide are counterfeit and in many developing countries, close to 50 percent of the available drugs are counterfeit, according to drug industry estimates.

There are no corresponding figures for the market of fake drugs in Korea. Here, as in any country, the extent of the problem is difficult to assess because the counterfeit drugs are difficult to trace. Neighborhood pharmacies, for example, may unknowingly buy fake drugs from suppliers, or deliberately buy them and reap a hefty price markup from innocent consumers.

"The real extent of the problem of counterfeit drugs is unknown. Counterfeiting is difficult to detect, investigate, and quantify. So, it is hard to know or even estimate the true extent of the problem. But there are indications that it is growing in Korea," said Arthur J. Katsanos, Korea head of U.S.-based Eli Lilly & Co.

Burgeoning market

Korea`s pharmaceutical market is estimated to be the tenth largest in the world, worth over $9 billion. Since the mid-1990s, many U.S. and European pharmaceutical companies have set up about 40 joint ventures here, to control close to 60 percent of the total market.

While domestic companies are more in number, they mostly manufacture generic drugs - copies of products whose patents have expired.

The trade figures too are impressive, with pharmaceutical imports totaling over $1.1 billion and exports accounting for $400 million in 2003.

Not surprisingly then, the size of the market for pharmaceutical products has attracted distributors of fake medicines.

The industry is however, not certain whether bulk of the fake medicines are being manufactured locally or are smuggled from China, an acknowledged hub for the manufacture and sale of these fake drugs.

Three weeks ago, after receiving complaints from international companies, Seoul police mounted raids on 123 pharmacies. ore than 150 million won in imitations of Cialis and Viagara, drugs to treat sexual dysfunction, were seized, police said. Eli Lilly and Pfizer Inc. of the United States developed Cialis and Viagara, respectively. Katsanos believes the raids uncovered just the tip of the iceberg. The customs authorities too have confiscated some shipments of fake drugs from China, but a much larger quantity is presumed to be making its way to local drugstores.

The issue has not hit the public conscience as have other health threats such as the "garbage dumpling" scandal that erupted this month, prompting a review of food standards.

Since it often is difficult to detect differences in appearance between real and fake drugs, medicines that do not work or cause unusual side-effects are rarely ever reported. giving few clues to officials about the scale and scope of potential dangers.

The over-arching concern, of course, is that fake versions of life-saving drugs, such as heart medicine, will be manfactured and distributed. If the drug is widely prescribed, several deaths may occur before the cause can be traced to counterfeit suppliers.

"The customs and the police authorities have been doing their best, and industry appreciates their efforts," said Katsanos.

"However, the health consequences of counterfeit medicines, many manufactured in unsanitary conditions with substandard or dangerous chemical components, are very real and can be life threatening. What is important therefore is to spread public awareness," he said.

Philippe Auvaro, chief operating officer and president of Aventis Pharma in Korea notes that major pharmaceutical companies are joining hands with local governments and passing on information to authorities concerned.

"As and when companies receive information, authorities are informed, and sufficient expertise is also provided to distinguish between genuine and fake drugs," he said.

Police have assured drug companies that more attention will be placed on nabbing illegal distributors.

"The police are placing great emphasis on its potential danger to national health and will expand investigations from pharmacies to illegal supply and distribution channels," the Seoul Metropolitan Police Agency told The Korea Herald.

Drug companies also are pressing for tougher penalties. At present, criminal sanction for violation of trademarks and pharmaceutical affairs law leads to a maximum imprisonment up to seven years and penalty up to 100 million Won.

Administrative sanction for violation of the law includes canceling the pharmacy business license for 6 to 15 months or cancellation depending on repeated crimes or value of the products.

It has obviously not deterred the distributors of fake products, with advertisements for the fake drugs frequently found in newspapers and on the Internet, a growing source of counterfeit medicine.

"The penalties have to be much more stringent to deter anyone from dealing with counterfeit drugs. Like narcotics, fake drugs too are life threatening and can cause severe damage to the companies," said Katsanos.