“Every player in the supply chain has to be equally committed,” Aaron Graham says over the phone from New York, explaining a solution for how to ensure serialisation is effective in terms of safety and cost alike. “We need to create a supply-chain security measurement that means that every time a product changes hands, it’s still our product.” He is setting out his vision for how the pharma industry can cut off supply to those who wish to infiltrate the chain with counterfeit goods.

Graham, a US federal agent turned pharmaceutical executive and consultant, has spent a large chunk of the past 20 years doing everything from going undercover with petty drug dealers to parlaying with Mexican cartels and drug smugglers. He’s seen desperate small-business owners buy cut-price pharmaceutical goods to survive lean financial times.

He knows drug counterfeiting inside out, and looks at everything from “the bad-guy perspective”. When asked by World Pharmaceutical Frontiers what he believes the big challenges in serialisation are in today’s market, Graham is happy to emphasise that the problems are complex and need to be examined from every angle – but he is certain that there are good solutions out there.

While serialisation has been a boon for pharma companies in terms of covering their backs with regulatory bodies, it wasn’t necessarily seen as such in its beginning, when costs were high and the effects weren’t yet known. The process has been expensive, often running into the millions, but with counterfeit prescription drugs raking in a market worth an estimated $75 billion a year worldwide, pharma companies still need a comprehensive plan of action.

Serialisation’s beginnings

“I began as an undercover agent in the US Drug Enforcement Administration (DEA), monitoring narcotics coming into the US – essentially smuggling and trafficking cocaine, heroin, marijuana and methamphetamines with the DEA.” Graham says, “I worked undercover with groups like the Hells Angels [Motorcycle Club] and the cartels, and that’s how I understand what the bad guys want to do; and once you understand what they want to do and how they want to do it, you can really devise the best scheme.”

He explains the basis behind serialisation and why it’s such a pressing matter: “We wanted to take on some of the more sophisticated criminals getting into prescription medicines and doing what we call a ‘diversion mechanism’, in which they could easily introduce counterfeit medicines into a supply chain in the US, Europe or South America. Once they’d found a weak spot, they could exploit it.

“This became a particular problem with OxyContin,” he says. “I ran an operation to identify the wholesalers that were dealing with small pharmacies. They were buying medicines off the generic market – often by fraudulent means – and introducing counterfeits, and then reselling them to the market and on to pharmacies, which had no reason to suspect anything.

“Then you had counterfeit goods being bought by patients, with pharmacies not even aware that they were selling counterfeit medicines.”

Graham also has a word of warning. “If you’re a licensed wholesaler and you always pay a certain price for medicines from your distributor, and then someone comes along and says, ‘I have that medicine you always pay $50 for, and I have it for $35 today because I got a great deal’, and it looks too good to be true, it probably is,” he says. But in his experience, unfortunately, many struggling businesses – or those willing to turn a blind eye – would buy the medicine.

“We have hours of recordings of counterfeiters talking about how to beat the system, how to get around the laws, and so on,” he continues. “We had a successful rate of prosecution, gave over $30 million in fines and arrested over 150 people, and that I think that was the precedent for the industry to act. It acknowledged that we need a way to track medicine from the time the manufacturer produces it all the way to the time it is acquired by a patient, so that when they get the medicine at a pharmacy, everyone can be assured that it’s the same blister pack, capsule or tablet that the manufacturer produced. At each movement of the supply chain, we should document those transactions.”

Feeling the effects

“We produced a drug called OxyContin – an opiate – that is now being terribly abused,” Graham says, noting this drug as one of the catalysts for the industry’s change of heart and a key reason why counterfeiting, theft and tampering are such huge problems in the US market. “It’s a great medicine for people who need it, but because people have abused it, doctors are now apprehensive to prescribe it.

“You might have a 72-year-old cancer patent in serious pain, at the end of their life, and their doctor doesn’t want to prescribe the medicine that could help, because they’ve read the hype about the problem. The problem, of course, is not with the cancer patient but with those abusing it, but the media has covered the situation to such a degree that patients are suffering. And, with pharmacists now in a position to get in trouble for selling counterfeits, the easiest solution for them is not to sell it – but then, again, the patient suffers.”

It was issues like this that led Graham and his colleagues to wonder how they could put a stop to it being sold illegally, and how they could get to the source and prosecute the people behind the problem.

The impetus at the time was retail giant Walmart, which was implementing radio-frequency identification (RFID) on its pharma products. Graham contacted the company to ask about the advantages of RFID.

I worked undercover with groups like the Hells Angels and the cartels.Once you understand what the bad guys want to do, you can devise the best anticounterfeiting scheme.

“It became clear that with unique RFID coding on every dispensable unit, you have the ability to track and document the product with an electronic paper trail,” he says. “The goal with electronic tagging was that we would know where a unit went and where the original manufacturer was, giving us some confidence in authenticity.”

The interactive solution

It doesn’t stop with serialisation; Graham has several ideas for ensuring product authenticity after serialisation, too. One comes from a recent invention by a pharma company in Germany: an app allowing patients to check the serialisation codes on their own medicines – particularly helpful for the long-term prescriptions of those with chronic illnesses.

To accommodate the technology, all of the company’s brands have 2D barcodes that are generated and printed on each package during the packaging process.

The app allows you to scan the barcode with a mobile device to verify the authenticity of the serial number on your medication. From the app, you can also follow a link to the company’s patient-support information.

Graham notes that this technology has been particularly helpful for HIV/AIDS medication, as these drugs are some of the most heavily counterfeited. Customers seem to be happy with the product and the added sense of security it provides, and regulatory bodies are encouraged to see a positive and engaging step that can be quickly rolled out.

Even with such an app that helps the patient take on another level of responsibility, however, there are pitfalls. Counterfeiters have now started to take real serialisation numbers and use them on generic products, meaning that a customer might check their medicine’s code only to find out it’s one of a batch of counterfeits; they have all been printed with a real serialisation code, but are not actually the product they’ve paid for.

Plan for the long term

Graham sees one clear path that can lead to disaster: throwing money at the situation without a plan. There is no downside to being practical and generous with serialisation plans, he believes, but companies must keep an eye on the end goal and make sure everything is there for a reason.

He warns against the urge to get the ‘deluxe package’ just because you can, as it might not help more in the long run. Yet companies should also be careful not to try to cut costs unnecessarily. “I was once in a boardroom and was asked how much a serialisation production system might cost,” he says.

“I offered up the sum of £1.0 million, or $1.2 million, for an immediate introduction and after that, £200,000 annually for maintaining it. The CEO turned to his CFO and asked if it was worth it. The answer was a resounding yes: if it saves one life, it’s worth it.”

It comes back to Graham’s advice for wholesalers and pharmacists: if it looks too good to be true, it probably is. To deliver a good product, serialisation must be invested in and used. Even today, when pharma companies might be looking to cut costs, Graham suggests spending money on a viable serialisation programme. Trying to save now will only cost more in the long run – from damages, counterfeits, lawsuits and harm to your reputation.