Image: Counterfeit drugs seized by U.S. Customs & Border Protection are seen on display at the agency's offices at John F. Kennedy Airport
Keith Bedford  /  Reuters, file
Counterfeit drugs seized by the U.S. Customs & Border Protection (CBP) are seen on display at the agency's offices at John F. Kennedy Airport in New York August 15, 2012.
By Senior Writer, NBC News
updated 2/13/2013 11:40:24 AM ET 2013-02-13T16:40:24

The 84 children in Nigeria who died after being given adulterated teething syrup. Two women in Argentina who died of iron overdoses. And, most recently, the 45 people who have died in an outbreak of fungal meningitis traced back to contaminated steroids sold by a Massachusetts pharmacy.

The problem of counterfeit, contaminated and adulterated drugs is global and requires not only a better international regulatory system, but big investments in the U.S. Food and Drug Administration as well as in developing a high-quality drug industry in developing countries, an Institute of Medicine panel says in a report released Wednesday.

The report calls for a track and trace system that would keep tabs on drugs, something experts have been demanding for years and that Congress has been unable to put into effect. It says the FDA needs to organize a tighter system for regulating pharmacies and the World Health Organization must lead and coordinate an international effort to set and enforce standards.

“It has been a really eye-opening experience over the last year,” said Dr. Lawrence Gostin, a professor of global health law atGeorgetown University Law Center in Washington, who chaired the panel.

The experts in pharmacy, drug security, international development and global health held briefings around the world to investigate the problem and develop a list of recommendations. They call for major reform in the United States.

“It should have happened years ago,” Gostin said in a telephone interview. “The United States sets a model for the world. I think it’s critically important."

The risks are far worse overseas than in the United States but the effects are worldwide. An estimated 80 percent of the active ingredients used in U.S. drugs are made in other countries. The FDA said at least 62 people died in 2007 and 2008 after being given contaminated heparin, a blood thinner, made in China.

Adulterated and thinned-down drugs can help promote resistant germs and parasites, and have driven outbreaks of drug-resistant tuberculosis -- which can then spread globally -- and malaria, the report says. "If you have a problem in Africa it does become a problem in the United States," says Dr. Otis Brawley of the American Cancer Society, who wasn’t involved in the panel.

It’s impossible to gauge the scope of the problem, said the Institute of Medicine, an independent group that advises the federal government. “Deaths from fake drugs go largely uncounted,” the report says.

But there are plenty of horror stories. “Between November 2008 and February 2009, 84 Nigerian children died from acute kidney failure brought on by the industrial solvent diethylene glycol in teething syrup,” the report notes. “A similar tragedy unfolded on a larger scale the previous year in Panama when a Chinese chemical manufacturer sold diethylene glycol, the active ingredient in antifreeze, as pharmaceutical-grade glycerin to a European company.” More than 200 people died.

Two women in Argentina died in 2004 when the wrong type of iron was used to make an injectable iron supplement.

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Patients usually don’t even know they’ve taken a bad drug, the report says. Most of the counterfeits look real and there’s no way to know is bad ingredients were used to make a legitimate drug.

In the United States, the high price of certain cancer drugs has proven too tempting. "Robert Courtney, a pharmacist in Kansas City, Missouri, made millions selling adulterated drugs to patients and physicians throughout the 1990s until 2001 when he was prosecuted for his crimes," the report reads.

Brawley says it’s impossible to gauge the effects of fake and adulterated cancer drugs. “A lot of the patients who were getting chemo were women who were getting adjuvant chemotherapy to keep their breast cancer from coming back,” he said. “If they had gotten the right drug doses, would their cancer have come back? We don’t know.”

The FDA’s issued three recalls in the past year alone of fake versions of Avastin, a popular cancer drug that sells for $2,500 a vial.

And most recently, contaminated steroid injections made at a single Massachusetts pharmacy killed 45 people and have sickened more than 600.

“The Massachusetts compounding pharmacy case is creating real public demand for greater safety and so one of our recommendations is you have to have rigorous licensing of wholesalers,” Gostin said. “At the moment, few states meet national standards for accreditation.”

The report recommends restricting the U.S. wholesale market to firms vetted by the National Association of Boards of Pharmacy.

A track and trace system would help stop problems like fake cancer drugs and the counterfeit pills now sold over the Internet, the panel says. Each product would have a unique identifier, allowing it to be monitored from manufacturer to patient.

It won’t be an easy sell in Congress, Gostin said, in no small part because of the cost. “The track and trace system will cost a lot of money but it will save tenfold, maybe a hundred-fold, of what it will cost,” Gostin said.

“The sheer scope and the public health threat that this presents in the United States could push Congress to do this,” he added. “The pharmaceutical industry itself is highly supportive of it. Consumers are highly supportive of it. It’s critical now that more and more patients are getting drugs over the Internet. Probably 50 percent of these drugs are bad drugs and they won’t know it.”

The FDA welcomed the report. "In order to meet the challenges of today’s global marketplace, the FDA is transforming from a predominantly domestically focused agency to one that is fully prepared to help ensure product safety and quality within a globalized world," FDA commissioner Dr. Margaret Hamburg said ina statement.

Allan Coukell, who has studied the issue at the Pew Charitable Trusts, thinks there is a “reasonable” chance of some for legislation regulating wholesalers. Pharmacies may have to help pay for any new regulatory program, he said. “It may be that Congress looks at some sort of registration fee,” he said.

As for helping create a safer drug industry overseas, U.S. cash can and should lead the way, the panel said. It said the International Finance Corporation and the Overseas Private Investment Corporation should invest in pharmaceutical manufacturing in low- and middle-income coun­tries.  “It is a perfect example of private investment and it’s perfect for the United States to do,” Gostin said.

One of the most contentious recommendations calls for clearer direction for FDA in regulating pharmacies like the one at the center of the fungal meningitis outbreak. Hamburg told Congress her agency didn’t have the authority to act against the New England Compounding Center, even though regulators knew for years the business had overstepped its license and had unclean facilities.

“Disagreement over what authority the FDA has promotes a degree of paralysis,” the report says.

“Neither the state of Massachusetts, nor the FDA had clear control over the New England Compounding Center. Confusion about their responsibilities created a regulatory gap that the company exploited. Similar confusion causes regulatory gaps in other countries where national and local governments share responsibilities for drug regulation.”

This infuriates Dr. Sidney Wolfe of Public Citizen’s Health Research Group. He contends FDA had the authority to close NECC, and should have. “They swallowed the FDA line,” Wolfe said in a telephone interview. “The FDA has the authority it needs.”

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