According to Peter Stokes, regional director of e-trade at Axway Asia-Pacific, in 2009 the WHO estimated that 50% of drugs worldwide were counterfeit, which translated into approximately US$38 billion in corporate sales lost each year.

(ZDNET Report August 2009)

The Cost to the Counterfeiter

Counterfeit drugs are attractive as a counterfeit item. Drugs typically sell at a high value and for the counterfeiter, the cost is relatively small. Like illicit drugs, counterfeit drugs can be produced with limited infrastructure in relatively cottage industries.

Many of the counterfeit drugs are made to look like the original, costing the producer little more than producing the drug itself. So, for a counterfeitable item, drugs are a relatively easy target.

The Cost to the Community

Counterfeit drugs rarely perform to the standard of main stream drugs produced using the correct products and under licensed procedures. See the previous section for the human cost of counterfeit drugs which can include:

• not providing adequate treatment
• use of toxic chemicals harmful to humans
• substandard proportions of an active ingredient

The Cost to Pharmaceutical Companies

It is easy to forget pharmaceutical companies in the cost equation when dealing with counterfeit drugs. The costs to pharmaceutical companies include:

• Infringement of intellectual property
• Fake packaging presenting a brand risk to the host pharmaceutical company
• Loss of potential revenue
• Public relations issues surrounding at risk groups including children

Internet Fraud Watchdog Can Help

Unchecked, and with no action taken, the counterfeiting of drugs can leave pharmaceutical companies exposed to unforeseen risk, reduced perceived brand reliability and possible legal action.

Internet Fraud Watchdog works with pharmaceutical companies to assist in fighting the online sale of counterfeit drugs. For more information, contact IFW to see how we might be able to tailor a maintenance package to assist your company.