Asia’s Counterfeit Drug Problem

It is estimated that the global pharmaceutical industry will reach almost $1.2 trillion USD annually by the year 2022.

Yet, some sources suggest that illegal black market activity involving the trade of counterfeit pharmaceuticals has a $250 billion effect on this industry per year. The World Health Organization (WHO) estimates that 10% of all drugs sold globally are counterfeits, and that this figure could be as high as 25% in developing countries, though many other sources put this latter figure as high as 60%.  This unique type of competition is not one that affects many other industries. Here in the US, we’d like to think that our governmental oversight and regulatory agencies prevent counterfeit drugs from ever making it to drugstore shelves. But, does this same oversight exist in parts of Asia?

Most of the pharmaceuticals consumed in North America are manufactured in China and India. The protection, regulation, and enforcement that we are accustomed to in the United States can be an issue in these emerging markets. In fact, counterfeiters go to painstaking lengths to reproduce the packaging in which genuine drugs are sold; black market pharmaceuticals have nearly identical holograms and logos which can only be viewed under UV light.

Recently, China and India have begun to crackdown on some pharmaceutical counterfeit operations, but this has failed to stop black market producers . When the Chinese government announced in November 2017 that it would be stepping up its monitoring to thwart the production and sale of fraudulent drugs, producers quickly moved to Southeast Asian countries, where regulations are not as strict. Myanmar, Thailand, Cambodia, and Laos are havens for counterfeit drug production, as the lax governance makes manufacturing easy. Furthermore, these countries are conveniently located near major seaports, which facilitate the export of drugs all over the world.

And it’s not just the US that these drugs are being exported to.

Infectious disease remains the number one killer in developing nations. Specifically, sub-Saharan African nations typically have high rates of malaria, a very treatable mosquito-borne disease that can cause death in some patients; namely the very young, the elderly, and the immunocompromised populations. A recent study has warned that up to ⅓ of antimalarials in Uganda and Tanzania are counterfeit or low-quality. Inadequate treatment of any disease can lead to not only death for an individual, but these sub-therapeutic doses can also cause widespread drug resistance in a region. In fact, the WHO estimates that 20% of malaria deaths each year would be prevented if all the drugs taken were genuine.

Unfortunately, it does not stop at antimalarials. Several drugs used to treat HIV/AIDS, tuberculosis, meningitis, typhoid, and pneumonia in Africa and Southeast Asia have been found to be counterfeit. These fake drugs can be toxic, past their expiration date, mislabeled as the incorrect medication, contain inadequate dosages of the correct medication, or have no traces of active ingredient at all.

“Why should this matter to me?”, you might ask. While only an estimated 1% of pharmaceuticals on the market in regions like North America, Western Europe, and Australia are counterfeit, we constantly travel to Asia for business and pleasure. Many US-based companies have local offices all over Asia with numerous expat workers and their families living abroad. Even here in the US, the allure of online pharmacies has attracted many customers, especially in the face of rising domestic drug prices and insurance overhauls. Americans should take caution when buying pharmaceuticals online; over ½ of the medications sold online are fakes from Asia.    

How can we organize an intervention for this “drug problem”?

Firstly, being a conscious and educated consumer is important when it comes to purchasing pharmaceuticals online or while traveling abroad. The antibiotic being sold to you in a back-alley for a quarter of the drugstore’s price? It’s probably a counterfeit. More importantly, Asian regulatory authorities must continue to crackdown on criminal counterfeiting operations in order to protect the global drug supply. Better regulation, harsher punishments for criminals, and consumer education are the keys to stopping the counterfeit drug trade and saving lives.


Sarah Wolochatiuk

MD/MBA candidate, class of 2018