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EFCG - the European Fine Chemicals Group - has been active in the fight against active pharmaceutical ingredients (API) counterfeiting for many years through discussions with the authorities and stakeholders in the EU, USA and China. They have published widely on the subject via articles and conferences to help raise awareness of the issue.

This article summarises what EFCG believes needs to be done to help combat the flow of sub-standard (counterfeit) APIs into medicines destined for the EU market. This is extremely important to help improve the protection of the health and safety of EU citizens and to sustain the competitiveness of EU manufacturers of APIs by removing illegal players from the EU medicines supply chain.

European Commission Public Consultation in preparation of a legal proposal to combat counterfeit medicines for human use.

In May 2008, the Commission completed a consultation process on how to combat counterfeit medicines for humans the results of which, including an impact assessment, are expected within a few months. While welcoming the prospect of new legislation, EFCG believes current legislation, though imperfect, if properly enforced with strong deterrents and severe penalties for offenders, would significantly reduce the escalating risk driven by globalisation and hyper-competition in off-patent APIs and medicines. This makes decisive action imperative and urgent as there is little or no deterrent to ensure at least a reasonable level of compliance with the laws governing the manufacture and use of APIs destined for the EU market.

While EFCG applauds the aims of the consultation, they consider it falls short of what is needed to combat the counterfeiting of APIs. For example, the consultation paper states: "Moreover, it is evident that any legislative measure needs to be complemented by appropriate supervision and enforcement. Any legislation can only be fully effective if it is thoroughly enforced by the competent authorities of the Member States". There is no evidence in the paper of how it will be transposed into a set of clear and effective measures.

The consultation was wider than just APIs, but EFCG's contribution focused on the need for an improved, harmonised regulatory framework and enforcement actions to maximise the security of the global supply chain that begins with the manufacture of APIs destined for use in medicinal products sold in the EU. In this context, they consider that the definition of what constitutes a counterfeit API and a counterfeit medicine to be of vital importance.


EFCG supports the basic definition that "Counterfeit APIs are active pharmaceutical ingredients for which source and /or quality are falsely represented on the label, on the Certificate of Analysis or otherwise". As such, any medicine that contains a counterfeit API is a counterfeit medicine.

It is, therefore, quite worrying that one can regularly hear the presumption being made that in the EU not a single case of a counterfeited off-patent medicine is yet known. When using the appropriate definitions this statement clearly loses its basis. Moreover, the above definition excludes APIs that are severely and deliberately non-compliant with GMP and/or the regulations. EFCG has, therefore, created the new term "Rogue APIs" to cover both counterfeit APIs and seriously, deliberately non-compliant APIs. Should a medicinal product contain either type of Rogue API, it may harm or even kill a patient. Note that Counterfeit APIs are normally severely, deliberately non-compliant but severely, deliberately non-compliant APIs are not necessarily always counterfeits.

What is yet lacking is a detailed definition of "severely, deliberately non-compliant APIs". EFCG believes the key to this definition should lie in the word "deliberate". In other words, this definition should apply when there is involvement of one or more parties that may be expected to be fully aware of EU GMP and regulatory requirements, but who knowingly bringing severely, non-compliant APIs into the supply chain for the EU market.

A recent good example is contaminated heparin, an off-patent, anti-coagulant API manufactured in China. The FDA suspects that heparin had been deliberately mixed with a lower cost, dangerous contaminant to save costs and raise prices at a time of shortage of raw heparin. Here human greed for financial gain outweighed any concern for human safety! The FDA has so far reported 150 contaminated heparin-related deaths in the USA since 2007.

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Non-compliance of an API with GMP does not make it a counterfeit. It just makes it non-compliant. However, a serious breakdown in regulatory compliance (e.g., a break in traceability, mis-labelling, any kind of fraud or fabrication in related documentation used in the buy/sell/registration operation) will make the API a counterfeit API. Counterfeit APIs are normally severely GMP non-compliant. EFCG believes that it is imperative that the definition of a counterfeit medicine recognises that when a medicine contains a counterfeit API it is a counterfeit medicine.

Many counterfeit APIs originate from manufacturers in countries - notably China and India - where many manufacturers are presently working with much lower standards than those in the EU. The oversight by the local authorities of APIs exported to the EU from such countries is completely lacking, relying instead on the vigilance and ethics of the purchasing company. Therefore, the protection of EU citizens against counterfeit APIs must depend on adequate EU-based systems for oversight and enforcement of the law along the full extent of the global supply chain.

Proposed improvements in enforcement and legislation to better protect EU patients against counterfeit APIs

EFCG's experience suggests that the proposals set out in the EC consultation paper do not go far enough to protect EU citizens from exposure to counterfeit medicines. They have, therefore, made a number of proposals to the European Commission over the past months to help overcome these deficiencies. There follows a summary of the highest priority improvements that they propose be considered as part of the legal proposal for APIs in order to tighten the requirements for the manufacture, placing on the market of APIs and inspections.

a. Mandatory GMP Certification of APIs

Only APIs covered by a GMP Certificate issued by an EU competent authority following a successful inspection should be allowed for use in the manufacture of medicinal products destined for the EU market. Such GMP Certificates should be included in the corresponding Marketing Authorisation Applications and, for importation into the EU, should be part of the documentation to be checked by EU Customs. These and other proposed requirements should also cover APIs imported into the EU as part of a medicinal product.

b. Prioritising Worldwide Inspections of API manufacturers & middlemen based on risk

Worldwide API inspections by European competent authorities should be prioritised through a risk-based system taking into account the geographical location as an important criterion for determining risk. In addition, the involvement of middlemen (brokers, traders, distributors etc) should be a key criterion for assuming increased risk. Involved middlemen should all be subject to inspections with the very highest priority.

c. Creation of a central EU unit to coordinate all worldwide inspections

The proper training and management of EU inspectors to deliver the proposed risk-based approach, would benefit from the creation of a central EU management unit - a function that could well be added to the EMEA structure - which could also coordinate all API inspections to be undertaken worldwide to ensure an efficient and effective use of resources.

All EU API inspection outcomes, whether positive or negative, should be made available - preferably in detail - to the public, through the EudraGMP Database on the EMEA Website.

d. Making the detection of fraud and counterfeiting top priority during inspections

API re-inspections should take place on a regular basis (every 2-3 years). The possibilities of fraud and counterfeiting should be the focus of the API inspectional approach. Details on how these aspects might best be dealt with during the various types of inspections have been sent to the Commission. EU inspections at manufacturers of APIs, medicines, and at traders and brokers, should be trained to look for possible API fraud by focusing on a company's purchasing and sales functions.

e. Eliminating inspection resource issues via a fees-based approach and MRAs

Any problems relating to insufficient resources for worldwide API inspections should be resolved through inspection fees to be charged to the inspected companies.

Mutual Recognition Agreements (MRAs) and information exchange with major, reputable authorities from other countries should cater for resource as well as knowledge sharing. Presently, we would advise very strongly against MRAs with high-risk API manufacturing countries, such as China and India, as we believe that, despite their announcement to the contrary, the authorities there still have a long way to go before an adequate level of trust is generated.

EU inspectorates should exchange information with countries with extensive knowledge of companies involved in fraudulent practices, e.g. NAFDAC / Nigeria.

f. Mandatory methods of API identification along the supply chain

Both the authorities and the industry should have adequate analytical testing methodology in place designed to detect counterfeit APIs.

g. Provision of an IT system to help Customs to stop importation of counterfeit APIs

A system should be implemented that will allow EU customs to prevent identified counterfeit APIs entering the EU. The system should help prevent entry into the EU market of all APIs originating from specific manufacturers and middlemen who have a proven record of being involved in counterfeit API business.

h. Introduction of tough sanctions and penalties for counterfeiters

Strong publicised measures, sanctions and penalties (encourage Member States to apply extradition) should be introduced against all parties that are involved in deliberate API fraud and/or deliberate, severe API non-compliance.

i. Introduction of a licensing system for middlemen, such as traders, brokers

Legislation should be enacted to enable the licensing of API supply chain middlemen (such as traders, brokers, importers and distributors) that operate in the supply chain between the producers of APIs and the suppliers of medicines, with the intention that they will be subject to the full enforcement of the law, to include Internet-based fraud.

Such legislation should require the introduction of traceability of APIs along the full length of the distribution chain by stating the origin of every API on every package, (i.e., country, company, site of production and / or unique API, package and production site reference numbers).

j. Clarify the legal liability of Qualified Persons

As to the liability of the Qualified Persons we would recommend that the EU carefully assess how it is legally arranged in Switzerland, as we believe its arrangements constitutes a suitable model.

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In order to better protect EU patients against the risk of counterfeit medicines for human use, and to sustain the competitiveness of EU manufacturers of APIs by removing illegal players from the EU medicines supply chain, EFCG has asked the Commission and the Member States to seriously consider the implementation of the above short term and longer term proposals.

The food and agriculture sector has shown how the application of harmonized legislation has had positive influence for the health of the EU citizen. EFCG has asked that the same enthusiasm and rules be implemented in the API and medicines sector.

Tony Scott
... is an adviser to the EFCG / Cefic, Brussels, Belgium

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