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Counterfeiting in the Global Drug Trade Poses International Health Risks

Counterfeiting in the Global Drug Trade Poses International Health Risks

Dec-18-07 01:21 pm

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With the increasing number of free trade zone hubs across the globe, countries have been opening up their economies as major points of trade. With greater market liberalization, however, many states with FTZs have also been playing host to illegal traders in counterfeit drugs. Today's New York Times reports that this growing problem presents not only a threat to effective and accepted practices of international trade by governments and multinational corporations, but also highlights a serious international health risk to end-users of counterfeit drugs if such trade cargos go undected and reach their final destination:

The seizure highlights how counterfeit drugs move in a global economy, and why they are so difficult to trace. And it underscores the role played by free trade zones — areas specially designated by a growing number of countries to encourage trade, where tariffs are waived and there is minimal regulatory oversight.

The problem is that counterfeiters use free trade zones to hide — or sanitize — a drug’s provenance, or to make, market or relabel adulterated products, according to anticounterfeiting experts.

“Free trade zones allow counterfeiters to evade the laws of the country because often times the regulations are lax in these zones,” said Ilisa Bernstein, director of pharmacy affairs at the United States Food and Drug Administration. “This is where some of the Internet sellers work,” she added.

Dubai is particularly attractive to counterfeiters because of its strategic location on the Persian Gulf between Asia, Europe and Africa. Records show that nearly a third of all counterfeit drugs confiscated in Europe last year came from the United Arab Emirates. “Three or four years ago, Dubai did not even appear on the radar screen,” said an investigator for a major American drug company who is based in China and requested anonymity because he did not have authority to speak for his employer.

Dubai is vulnerable because of the huge volume of goods that move through its free trade areas, and because of what is perceived by some in the pharmaceutical industry to be a murky line of authority for rooting out counterfeits there. “It is not clear that the normal Dubai customs authorities have jurisdiction,” said Rubie Mages, a director of global security for Pfizer.

The authorities in Dubai do show a willingness to act when drug company investigators tip them to possible counterfeits, as they did in the raid announced earlier this year. “Dubai has taken a big step in fighting the counterfeiters,” said Ahmed Butti Ahmed, director general of Dubai customs.

But significant quantities of fake drugs are still getting through, international health officials say. And as countries create more free zones, counterfeiters have more options. “What happens is they move around,” said Ms. Bernstein of the F.D.A. Sometimes, in an attempt to avoid detection, they move products between free zones.

Two issues are at play here. One is the domestic legal, security, and regulation systems that each government must put into place and utilize in order to effecitively monitor and control such illegal trade. The other issue is coordinating international cooperation in the areas of trade and health between countries through which shipments will pass. Greater efforts between countries, facilitated at the international level, presents a possible avenue towards decreasing the illegal drug trade, as well as fostering increased accountability at the domestic level where the adverse impact of counterfeit drugs may be most actutely felt.

Posted by: Brendan P. Geary

Tags: international law international trade international health

About the editor:

Anthony Clark Arend

Professor

Commentary and analysis at the intersection of international law and politics.

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» Learn more about the M.A. in International Law and Government at Georgetown University.

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