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Threats in Pharmaceutical Supply Chain

Threats in Pharmaceutical Supply Chain

- It is vital to maintain the secrecy and integrity of R&D and protect intellectual property
- Electronic security equipment are used to monitor internal perimeters, and make sure only authorized personnel enter critical sites

Theft — of designs, patents, raw materials and finished products — is the biggest problem facing the pharmaceutical industry. Stolen drugs are often blended in with counterfeit ones, and there is no easy way to identify tampered or damaged products even if the stolen items are recovered. Not only is this a major health risk for the general public, but it also creates huge legal and financial headaches for pharmaceutical companies while crumbling trust in modern medicine.

With manufacturing operations increasingly moved to emerging markets and more pharmaceuticals outsourcing to contract manufacturers, there are many points of vulnerability in the system, and one weak link is more than enough to cause damage.

Many can accept subpar quality of counterfeit consumer goods, but none would be willing to risk their lives over counterfeit drugs. According to the World Health Organization, “regular use of substandard or counterfeit medicines can lead to therapeutic failure or drug resistance. In some cases, it can lead to death.”

Pain in the Neck
Recent news headlines indicate these illegal operations are complex and, in many cases, global efforts.

In a recent incident, counterfeit Avastin (genuine version aimed to treat various types of cancer) was found circulating in legitimate distribution channels. CBS News chief investigative correspondent Armen Keteyian discovered that the company that sold the counterfeit “offered 400-milligram vials for just under $2,000 — about $400 less than the genuine manufacturer's price."

The counterfeit drug was shipped to the U.S. by a company with the same owner in the U.K. Prior to that, it had been sold through companies in Denmark and Switzerland. A man associated with the company said the drugs came from Turkey, but where the Avastin was originally manufactured is unknown.

To complicate the scene, there are a large number of patents expiring between 2011 and 2014. This has two implications: 1. In-house manufacturing becomes less feasible for “Big Pharma.” Patent expiry of key blockbuster drugs worth $45 billion and biologics worth $30 billion is expected to reduce the capacity utilization rates of manufac-turing facilities in Big Pharma companies, according to Ranjith Gopinathan, Program Manager of Life Sciences, Frost & Sullivan. “Moreover, a slowdown in new drug launches by Big Pharma is leading to a further reduction in capacity utilization, thereby making in-house manufacturing an unfeasible option, particularly for off-patent drugs.”

2. More generic drug manufacturers will be trying to compete in the market. Although the drugs must still be approved by regulatory bodies, smaller manufacturers may not have the resources or motivation to instill the same level of quality control.

Work out the Kinks
Pharmaceutical manufacturing facilities make products that have the potential to cause great harm to consumers in cases of internal product tampering. Also, with the high costs of developing new products, it is vital to maintain the secrecy and integrity of R&D and protect intellectual property, said Paige Prechter, Global Account Manager of Building Efficiency, Johnson Controls. “Security plays a major role in both of these areas.”

Depending on area and facility to be monitored and protected, the manufacturing plant would generally use a combination of different types of access control products, such as biometrics for highly critical areas and facilities, and proximity cards and smart cards for less critical areas and facilities, said Vincentius Liong, Director of Integrated Security Systems Solutions, Elektrodata Sistem Integrasi.

Externally, drug developers may face protesters unhappy with animal testing or some other aspect of the research or manufacturing process, Prechter added. Animal rights activists are not the type of people that pop into mind when terrorism is mentioned, but the threat is there and not an insignificant one. Since 2009, animal rights extremist Daniel Andreas San Diego has been alongside with Osama bin Laden on the FBI's “Most Wanted Terrorists” watch list. “Video is used to monitor external perimeters, where protesters may gather or intrude. Manufacturers may also employ extra, temporary security guards with specialized training to help control and defuse potentially dangerous situations,” Prechter said.

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