Tag Archives: cargo theft

The Future of Healthcare Supply Chain Security

Businessman looking through binocularsLet’s take a brief pause from our in-the-moment work on meeting today’s healthcare supply chain security needs and consider what the supply chain will look like in the future.  Because of regulations and laws enacted in 2012 and 2013 in the U.S., and expected in 2014 in the E.U., we know more today about how healthcare supply chain security will work In 2024 than looking forward in any previous 10 year period.  In the last two years the U.S. and the E.U. have enacted legislation and introduced regulations that will have a profound impact on the security of these major supply chains in ten years.  These include:

Continue reading The Future of Healthcare Supply Chain Security

How the DQSA Will–And Won’t–Protect The Supply Chain, Part 1

SuperheroThe supply chain provisions contained within the Drug Quality and Security Act (DQSA)—themselves known as the Drug Supply Chain Security Act (DSCSA)—mark a significant achievement by Congress and the industry to protect the U.S. pharmaceutical supply chain from criminals.  It is the first completed attempt since 1987 when the Prescription Drug Marketing Act (PDMA) was enacted by Congress and signed by President Ronald Reagan.  In comparison, the provisions of the DSCSA are much more detailed and extensive than the PDMA and they read as if they were heavily influenced by people who solidly understand the scale and complexity of the legitimate supply chain.  Which, they were, based on the contribution of the Pharmaceutical Distribution Security Alliance (PDSA)—made up of key stakeholders in the supply chain—in their development.  That should ensure that the industry will be able to adopt the technology and process modifications necessary to meet the new law on time.

But will all this also lead to true protection of the supply chain from criminal activities?  Will the DSCSA portion of the DQSA end up presenting new and insurmountable barriers against criminals who game the supply chain to their advantage and thereby putting patients at risk?  These are the true measures of the success of this type of legislation.  How can we know if the DSCSA will have these positive affects? Continue reading How the DQSA Will–And Won’t–Protect The Supply Chain, Part 1

We Should Be Ashamed Of The U.S. Approach To Pharma Recalls

Flicker / Akulawolf

That’s right.  We should all be ashamed of the way our supply chain handles drug recalls and we should do something about it.  I will explain, but first, what is a drug recall?

Today, when the manufacturer decides that a recall is necessary—either on their own or through a request by the FDA—they issue a recall for it.  The FDA website is a great resource for learning about what a recall is (see “What is a recall?”, and “FDA 101: Product Recalls – From First Alert to Effectiveness Checks” and their recalls homepage at “Drug Recalls”).

Recalls can be issued for a number of reasons including Continue reading We Should Be Ashamed Of The U.S. Approach To Pharma Recalls

InBrief: Pharma Supply Chain Criminals Get Justice

Two weeks ago, confessed pharma supply chain criminal William Rodriguez of South Florida was sentenced to 10 years of prison time, and then two years of supervised release.  He was also required to hand over $55 million, which represents the proceeds from his crimes.

What was his crime?  He was the person who ran the licensed wholesale drug distribution company formerly in South Carolina, Ocean Pharmed, that bought the Novo Nordisk insulin that was stolen in a cargo theft back in 2009.  In his plea, Rodriguez admitted that all of the drugs that Ocean had sold into the supply chain had been obtained from unlicensed or otherwise illegitimate sources, like the stolen insulin.

This is the story that was so well documented by Katherine Eban in her excellent March 2011 article, “Drug Theft Goes Big” in Fortune Magazine online, and which I discussed in my essay “Lessons from ‘Drug Theft Goes Big’” and further Continue reading InBrief: Pharma Supply Chain Criminals Get Justice

The Built-in Protections Of The U.S. Pharma Supply Chain

Last week we learned that 11 people were charged with the record-breaking $75 Million drug heist from the Eli Lilly warehouse in Enfield, Connecticut back in March of 2010 (see the excellent article by Jay Weaver in the Miami Herald, including a copy of one of the multiple indictments).  Importantly, all of the stolen drugs from the Lilly warehouse were apparently recovered before they could be re-introduced into the legitimate supply chain.  But this investigation and the charges go well beyond the infamous Lilly warehouse theft.  They include other pharmaceutical, liquor, cigarette and cell phone cargo thefts around the country, allegedly perpetrated by members of the same criminal organization.  Cracking this organization could end up disrupting the most prolific source of cargo theft in the United States over the last five years.

Congratulations are due to the law enforcement organizations who contributed to the investigation and to bringing the charges.  They include DEA, ATF, FBI, U.S. Attorney of Florida, Miami-Dade Police Department, Florida Highway Patrol, U.S. Attorney of Illinois and U.S. Attorney of New Jersey.

This episode highlights one of the things I call the built-in protections of the U.S. pharmaceutical supply chain—the things that, combined, result in the U.S. having the safest supply chain in the world.  In this case, it is strong and cooperative law enforcement organizations.  While far from perfect, would you trade our system of justice, including law enforcement, with that of any other country in the world?  I don’t think you would (unless you’re one of the Villa brothers or their associates!).

But what are the other components that result in the safest drug supply chain in the world?  It’s certainly doesn’t occur by accident, so what are the built-in protections? Continue reading The Built-in Protections Of The U.S. Pharma Supply Chain

How Counterfeit Avastin Penetrated the U.S. Supply Chain

Counterfeit Avastin

The internet lit up last week when the U.S. Food and Drug Administration (FDA) posted an announcement that they are aware of counterfeit Avastin in the U.S. pharmaceutical supply chain (see “Counterfeit Version of Avastin in U.S. Distribution” on the FDA website and Genentech’s announcement).

I found out about it when I received notice of Dr. Adam Fein’s (PhD) excellent blog posting “Greedy Physicians Invite Fake Avastin Into the Supply Chain” on his DrugChannels.net blog, but multiple national news agencies picked the story up and many articles were written about it.  Most simply reflected the contents in the FDA’s announcement.

But at least one news source seemed to do some additional investigating.  Bill Berkrot and John Acher of Reuters published the excellent article “Fake Avastin’s path to U.S. traced to Egypt” on Thursday.  In the article they provide a little more background on the path the drugs allegedly took before apparently arriving on the shelves of U.S. physicians and potentially in the bodies of unsuspecting U.S. patients.

And Pharmaceutical Commerce Online reports that Avastin isn’t the only incident of recent counterfeit injectable cancer drugs making it into the U.S. market that the FDA is currently investigating.


Now keep in mind, this is only investigative journalism so far, and while the information source listed in the Reuters article is the Danish Medicines Agency, criminal investigators may already know more than this and in the end, some or all of the contents of the Reuters article may eventually be found to be untrue.  Whether ultimately true or not Continue reading How Counterfeit Avastin Penetrated the U.S. Supply Chain

STEP #1: Raise Penalties For Drug Crimes To Reflect The Widespread Harm They Can Inflict

Last Thursday a bipartisan group of U.S. Senators and Representatives jointly introduced a bicameral bill that would significantly increase the criminal penalties for drug counterfeiting to as much as 20 years in prison, as reported by Phil Taylor in SecuringPharma (see the article for the details).  The house bill is called H. R. 3468, The Counterfeit Drug Penalty Enhancement Act.  The group of legislators include U.S. Senators Patrick Leahy (D-VT), Chuck Grassley (R-IA), Michael Bennet (D-CO), and Richard Blumenthal (D-CT) and U.S. Representatives Patrick Meehan (R-PA) and Linda Sánchez (D-CA).  Not surprisingly the responses from the Pharmaceutical Research and Manufacturers of America (PhRMA) and Pfizer were swift and supportive.

Raising the penalties for counterfeiting drugs to the point where they adequately reflect the widespread harm they can cause the public is a very good thing.  It should have the effect of making people think twice about selling counterfeit drugs to Americans through the internet or attempting to introduce them into the legitimate supply chain (brick-and-mortar and legitimate internet pharmacies).  It may even cause more people in the legitimate supply chain to Continue reading STEP #1: Raise Penalties For Drug Crimes To Reflect The Widespread Harm They Can Inflict

SNI’s Are Not Enough In a Plateau-Based Supply Chain Security Approach

I recently published an essay on RxTrace called “Plateaus of Pharma Supply Chain Security” in which I proposed that a better timeline for the introduction of technology to secure the U.S. pharmaceutical supply chain was one based on plateaus.  Each succeeding plateau would add the adoption of new technology and/or data communications among the participants in the supply chain with the intent of elevating the security over the previous plateau.

In that essay I included illustrative dates for each of the four plateaus that I offered as an example of the concept, but you could easily imagine the overall program having open-ended dates that would allow the supply chain to adopt one plateau at a time and move to the next plateau only if/when a security problem is discovered at the current plateau.  That is, jump to the next plateau only when necessary.  Taking this approach, you may never actually need to get to the later plateaus.

For example, imagine that the first plateau were for manufacturers to serialize all drugs at the pharmacy-saleable package level (what I normally call “unit-level”) with an FDA Standardized Numeric Identifier (SNI) and all supply chain owners of drugs were to read the SNI’s and simply keep records of who they bought them from and who they sold them to.

With no data communications between trading partners that includes the SNI’s it might seem that little
security has been gained over what is done today.  But this small step (“small” compared to a full pedigree or track & trace system) would allow criminal Continue reading SNI’s Are Not Enough In a Plateau-Based Supply Chain Security Approach