Collaborating to Protect the Supply Chain from Counterfeiters

December 2, 2012
Adeline Siew, PhD

Adeline Siew is editor for Pharmaceutical Technology Europe. She is also science editor for Pharmaceutical Technology.

Pharmaceutical Technology, Pharmaceutical Technology-12-02-2012, Volume 36, Issue 12

Adeline Siew PharmTech speaks to Lynne Byers and Brian Johnson about Rx-360's initiatives to protect patient safety.

Counterfeit medicines are prevalent across the globe. From proprietary medicines to generic drugs, counterfeiters are not only targeting lifestyle drugs such as Viagra and Cialis, but also expensive treatments for life-threatening conditions such as cancer. This year saw the appearance of counterfeit Avastin, which affected 19 medical practices in the United States, demonstrating that even countries with stringent regulatory and enforcement systems are not exempt from the escalating problem of counterfeits (1). In this digital age, the Internet provides an easy channel for counterfeiters to dispense their fakes. Purchasing medicines online with just a click of the mouse is becoming increasingly prevalent because of the convenience it offers, and according to the World Health Organization (WHO), constitutes more than 50% of counterfeit cases (2). In July 2011, the European Commission published the Falsified Medicines Directive (FMD) 2011/62/EU in an effort to better protect patients and consumers. The new directive, which aims to prevent falsified medicines from entering the legal supply chain and reaching patients, will come into effect in January 2013. Meanwhile, FDA's Safety and Innovation Act (FDASIA), enforced in July 2012, has made provisions to ensure the safety of drugs, for example by implementing new counterfeiting penalties, including one for trafficking fake medicines.


To examine the progress made to date in the war against counterfeits, PharmTech spoke with Lynne Byers, vice-president of quality at GlaxoSmithKline, and Brian Johnson, senior director of supply-chain security at Pfizer. Both are representatives and members of Rx–360, an international pharmaceutical supply chain consortium developed by volunteers from the pharmaceutical and biotech industry, with a mission to protect patient safety by enhancing the security of the pharmaceutical supply chain to assure the quality and authenticity of products and materials moving through the supply chain.

PharmTech: How successful have regulators and the pharmaceutical industry been in the battle against counterfeits?

Lynne Byers

Johnson: We have made great progress as an industry in battling counterfeit medicines and other supply-chain security breaches; however, there is still much more to do. Some examples of positive progress from a legislative perspective include the passing of the FMD in Europe and FDASIA in the US. Operation Pangea is an example of collaborative enforcement efforts, where an international law enforcement campaign involving 100 countries succeeded in shutting down more than 18,000 rogue online pharmacies. Rx–360 has also done some great work in the supply-chain security space, with several white papers that will help prevent, detect, and respond to counterfeiting and other supply-chain security threats. There are many other examples and they all contribute to our fight in different ways. Nevertheless, even with these success stories, we still see examples of global supply-chain security breaches in the news every day. We must remain vigilant.

PharmTech: What would you identify as the key provisions on the EU FMD or the US FDASIA in addressing supply-chain security? How can regulators better harmonize efforts globally?

Byers: In terms of improving supply-chain security, the key provisions of the FMD are as follows. All active substances, or APIs imported into the EU, will be required to be manufactured in compliance with GMP equivalent to those of the EU by Jan. 2, 2013. Written confirmation of compliance with this requirement, which will be issued by an authority in the exporting country, will need to accompany all active substances imported into the EU as of July 2, 2013. Exporting countries may apply for an exemption to these rules, but no country has been granted an exemption to date. In exceptional circumstances, and where necessary to ensure the availability of medicinal products, if the API manufacturing facility has an EU GMP certificate, then a member state may waive the requirement for written confirmation for a period not exceeding the validity of the GMP certificate. Member states that make use of the possibility of such waiver shall communicate this to the European Commission. The first country has just been granted an exemption from the written confirmation requirements—Switzerland. The process, which is to be used by each member state's regulatory authority, has not yet been communicated. In terms of regulators working more closely together, the mutual recognition of inspection reports is encouraged because this will help regulators to inspect more facilities.

Brian Johnson

Johnson: Collectively, the recent legislation in the US and EU will help enhance supply-chain security but we need similar legislative initiatives in other regions of the world to level the playing field. Our supply chains are complex and global, and because the weakest link is what criminals will exploit, global harmonization is critical. We are heading in the right direction with initiatives by regulators to collaborate on auditing, information sharing, and risk analysis. Other stakeholders are collaborating through organizations such as Pharmaceutical Cargo Security Coalition (PCSC), Pharmaceutical Security Institute (PSI), and Rx–360. It is hard to single out specific provisions of legislation, regulations, or efforts by specific organizations because they all contribute in different ways and attack different aspects of the problem. The key will be continued collaboration and avoiding working in silos, which we tend to do sometimes.

PharmTech: Could you provide an update on Rx–360's initiatives and activities thus far in 2012 and its focus of activity for 2013?

Byers: Firstly, as a consortium, we are enhancing and facilitating joint and shared audits. Both audit programs are operational following a period of piloting. Secondly, we are also addressing a broader range of supply-chain security topics. A new supply-chain security group was established and has developed and shared best practice documents. Thirdly, we are actively engaging regulators and educating legislators. In terms of communications, we have organized webinars around many Rx–360 initiatives. We have also produced 326 news flash reports and process for industry wide messaging, 90 summaries of proposed or passed regulation or legislation with an average time to publish between 6–10 days, 16 newsletters and conducted 4 open meetings.

For 2013, we have targets to increase membership in all categories and to continue to work on our priorities of the audit programs, supply-chain security and analysis, and swift dissemination of supply-chain security information.

PharmTech: To date, what are the three biggest achievements accomplished by Rx–360?

Byers: I would say that our three biggest achievements are: global collaboration between manufacturers and suppliers within the organization; a positive opinion from the Federal Trade Commission (FTC) that the audit programs, if operated as described to the FTC, are unlikely to breach US anti-trust laws; and our ability to pull together world experts to work on a problem within a tight timeframe (e.g., following the tsunami in Japan).

PharmTech: What best practices can you offer for the industry to monitor their materials coming through global supply chains, especially with products coming from emerging markets, such as China and India?

Byers: Rx–360 develops and shares best practices and points to consider in relation to the security of the supply chain. This ­information is freely available on the Rx–360 website. One example of a point to consider relates to tamper evident seals, which are used on raw material containers (3).

Johnson: Companies need to have comprehensive supplier quality management programs to monitor and manage materials and products from external sources, regardless of the region being sourced from. This starts with supply chain transparency and a good understanding of all of the "players" in the supply chain. When the supply chain is well understood, companies can then use risk-assessment processes to determine appropriate strategies to mitigate risk, including risks associated with sourcing from regions with less developed regulatory infrastructure. Having clear requirements, good contracts, and robust oversight programs to ensure your suppliers meet your expectations are foundational.

PharmTech:With regards to supply-chain security, what are the common challenges faced in preventing and detecting intentional adulteration, illegal diversion, and counterfeiting of products and packaging? What steps or holistic approach is Rx–360 taking to address these problems considering how complex the pharmaceutical supply chain can be?

Johnson:As an industry, our biggest challenge and our greatest opportunity is tackling supply-chain security threats holistically. We have historically organized around individual threats, such as counterfeiting or specific parts of the supply chain, such as contract manufacturing. We also have not always balanced prevention, detection, and response to these threats. Winning this battle will require collaboration across the supply chain and between all stakeholders.

What we are trying to do in Rx–360 is to promote a holistic approach to supply-chain security. This includes defining the supply chain broadly (end to end), recognizing the advantages of working on the threats (counterfeiting, theft, diversion, and intentional adulteration) collectively, and balancing prevention, detection, and response. Our first whitepaper on comprehensive supply-chain security programs captures many of these concepts and is a good roadmap for the supply-chain security work we will be doing.

PharmTech: Could you give some background on the aims and functions of the different supply-chain working groups under Rx–360 and what each working group has achieved to date?

Johnson: Rx–360 endorsed the creation of the supply-chain security working group in October 2011. The goal of this working group was to promote a holistic approach to supply-chain security. We kicked off four working teams towards the end of 2011. The objectives for each of the teams were:

SCS Management Systems—Benchmarking and white paper describing comprehensive supply-chain security program.

Conveyance Risk Management—Benchmarking, development of risk model and white paper on using risk- based approaches to conveyance security.

Market Monitoring—Benchmarking, white paper and framework on good practices/tools-techniques, emerging technologies, to monitor the market for criminal activity.

Audits and Assessments of Third Party LSP's—Points to Consider for audits/assessments; audit standard methodology; audit tools for LSP's.

Free webinars were conducted for each workgroup and the whitepapers are currently posted on the Rx–360 website. This was all accomplished in approximately six months.

We also recently kicked off four additional workgroups with the following objectives:

Incident Management—benchmarking and development of a white paper describing a process to respond to supply-chain breaches.

Illegal Diversion—benchmarking and development of a white paper on approaches to prevent, detect, and respond to illegal diversion.

Drug Shortages—benchmarking and development of best practices for what companies can do to prevent supply-chain security breaches resulting from drug shortages.

"Serialization" Discussion Group—discussion group to share information on strategies and challenges for implementing serialization globally.

PharmTech: Could you briefly discuss best practices when it comes to responding to supply-chain security breaches?

Johnson: A centralized effective incident management process for intentional adulteration, theft, illegal diversion and counterfeits is important. A comprehensive process should have the following attributes: accurate and timely incident reporting; timely investigation; immediate actions where appropriate (e.g., notifying regulators and law enforcement); risk assessment; identifying root cause if applicable; executing corrective and preventative actions; monitoring, analysing and reviewing trends; and continuous improvement. This is not that dissimilar to the processes we use in our quality management systems.

PharmTech: The serialization implementation discussion group aims to get companies to collaborate on implementing differing requirements globally; could you discuss the challenges involved in this process and the steps being taken by Rx–360?

Johnson: First, it is important to point out what Rx–360 is not doing with this discussion group. We are not advocating on the various legislation and/or regulations being developed globally. There are other organizations actively engaged where our member companies participate so we decided to focus on an unmet need, which was to create a forum where supply-chain stakeholders could share information and approaches being taken to implement solutions and make investments (e.g., technical and IT) in a world where significantly different models are being developed. The challenges are obvious when we all work in a global marketplace.

Lynne Byers is vice president of quality at GlaxoSmithKline.

Brian Johnson is senior director of supply- chain security at Pfizer.


1. FDA, "Counterfeit Version of Avastin in US Distribution" (FDA website, 2012)., accessed Nov. 12, 2012.

2. WHO, "Medicines: spurious/falsely-labelled/falsified/counterfeit (SFFC) medicines" (WHO website, 2012), accessed Nov. 12, 2012.

3. Rx–360, "Rx–360 Points-to-Consider: Optimizing Pharmaceutical Raw Material Tamper Evidence" (Rx –360 website, 2012), accessed Nov. 12, 2012.

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