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The Digitization: Important Allies in the Fight against Counterfeit Drugs

The big business with the small pills

The Dangerous Business with Counterfeit Drugs
Healthcare & Pharma

Counterfeit drugs can be life-threatening in the worst case - in the best case they simply remain ineffective. In any case, they cost the economy billions. For this reason, counterfeit protection of pharmaceutical and medical products must be placed on the (social) political agenda. 

Not only with the outbreak of the Corona pandemic has the trade in counterfeit medicines increased massively. Plagiarisms are not only traded on the Internet but are also infiltrated into the legal distribution chain via wholesalers and the pharmacy network. For this purpose, distribution and delivery documents are forged and the products are sold to unknowing wholesalers. These trade channels are becoming increasingly complex when they cross national borders. This applies both within the EU and beyond its borders.

The Big Business with the Small Pills

The business with medical products is highly profitable. In March 2019, for example, Europol seized counterfeit preparations worth 165 million euros in one single operation. (Source in German)

Last March, the organization blocked 250 links to websites where illegal products were sold. Comparable reports are regularly published, but they rarely make it into the news and thus into the attention of consumers and those who are responsible. The market for medicine trade is enormous: According to a current study of Bitkom, 58% of the Germans buy their medicines online – and the tendency is still rising. (Source in German)

Every year, around 400 billion euros are spent on medicine in this country. (Source) No wonder, that this profitable market also attracts illegal traders. Even cheap products such as dietary supplements with Vitamin C still promise the counterfeiters enough margin to participate in this big business.

Ineffective, Contaminated, Dangerous to Life!

Hence, everything that promises profit is counterfeited: from vitamin supplements to potency pills to cancer drugs. The following categories must be distinguished:

  • Drugs without any effect
  • Products with too high or too low of an effect
  • Drugs with the wrong ingredients
  • Contaminated and unhygienically packaged products
  • Incorrect packaging and / or instructions leaflet
  • Copies of original products

However, packaging, labels and tags are also counterfeited on a large scale to mislead customers into believing that the contents are original and tested. After cigarettes and toys, this product group is the third most frequent to violate the copyrights of the legitimate manufacturers, as a survey by the EU in 2019 shows. (Source in German)

Damage to Health, Economy & the Public Welfare

However, the counterfeit drugs do not only harm those who take them. Also from a business and economic perspective, the problem is quiet significant: reputable pharmaceutical companies, manufacturers, distributors and importers are losing billions. In addition, ineffective or health-threatening plagiarisms of globally known drugs destroy the reputation of the originals. Last but not least, the state not only misses taxes when counterfeit medicines are bought online, but in the worst-case costs arise in the health care system when patients need medical care after taking them. If only for this reason, the responsible institutions should have an even greater interest in the anti-counterfeiting of medical products. Manufacturers of branded products are therefore increasingly relying on technical security means for copy protection, authentication and distribution control of their goods. But security marks such as the GS mark or the CE mark as market conformity mark are unfortunately no longer an indication of original products. These marks are just as often counterfeited as the original products themselves. (Consumers find access to databases and purchasing helps for tested products at As a result, digitization is an important partner in the fight against counterfeit drugs. Thanks to digitization, the identification features of prescription-only drugs, which have been in force since February 2019, are now possible using a data matrix barcode and database comparison. In Germany, the system for authentication of drugs is called SecurPharm. Users of the system are hospitals, pharmacies, wholesalers and pharmaceutical companies. Some features, such as logistics seals or colour pigments can only be read by the authorities, such as customs, with appropriate readers. Others, such as holograms or first-opening seals, can also be recognized by the end users.

Putting a Stop to Counterfeiters with Digitalization: Example Russia

A look across national borders shows how other nations are dealing with the problem. Russia, for example, is making attempts that go far beyond the barcode solution. In Russia, every single product transaction is tracked along the entire value chain. For this purpose, drug packages are packed in shipping  cartons with their own Serial Shipping Container Code (SSCC), to which the serial numbers of the product packages contained in the carton are assigned. This way, the shipping process can be recorded reliably and seamlessly. A so called crypto-code, an encryption method based on Russian crypto-technology, provides additional verification options.

Tracking Methods for More Protection

The Russian serialization systems show the possibilities offered by digitalization, to make life more difficult for drug counterfeiters. In the medium term, apps are also conceivable for end consumers, as they are already known and used today, for example to track ingredients in cosmetics or the production conditions of clothing. The technical possibilities are already available to make the trade in medicines more transparent and thus safer for all of us.

By the way: If you are not sure whether the medicine you are holding in your hands is an original, just go to your nearest pharmacy. The local pharmacists can contact the Commission for Drugs of the German Pharmacists or the Central Laboratory of German Pharmacists directly. They are the main contact partners of the pharmacies for handling and investigating suspected cases of counterfeit medicines, according to the ABDA.

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Written by

MA_Carl Rainer Stetter_Commerce
Carl-Rainer Stetter
Experte for Counterfeit Protection