Anti-Counterfeit Drug Initiative--Public Meeting

INTRODUCTION

MR. TAYLOR: We recognize that some people are still taking their seats, but for the purposes of sticking to our agenda as best we can, we'd like to get started. Thank you. Thank you.

I'm John Taylor. I'm Associate Commissioner for Regulatory Affairs. I want to thank all of you for coming. There's an accident on 495 that has caused a bit of a traffic back-up on Wisconsin Avenue. That's one of the reasons why people are still making their way here. So an unforeseen circumstance that we had no control over, but we want to apologize for the difficulty you may have had in getting here.

Again, thank you for coming. As many of you know, in July the Commissioner announced a major new initiative to more aggressively protect American consumers from drugs that have been counterfeited. The new initiative created an internal task force to explore the use of modern technologies and other measures, such as strong enforcement, that will make it more difficult for counterfeit drugs to get distributed with or deliberately substituted for safe and effective drugs.

As we stated at the time that we initiated this effort, the task force was slated to submit its initial findings and recommendations in approximately 60 days in an internal report, which we released a couple weeks ago, and a copy of which, I believe, was on the table outside the room. And we also promised that we would issue a final report six months from the date of inception, which means that we'll be delivering a final report on this issue in January or February of the next year.

In addition, we stated that we would plan to coordinate more closely with other federal agencies and state and local governments that shared the responsibilities with FDA for ensuring the safety of the United States drug supply and distribution system, as well as working more closely with members of Congress and industry who have worked closely with FDA in the past and we hope will continue to work closely with FDA in the future on this important public health issue.

As you know, counterfeit prescription drugs are not only illegal, but they are also inherently unsafe. Many counterfeit drugs are visually indistinguishable from the authentic versions and, thus, pose a potentially serious health threat to Americans.

In the United States, drug counterfeiting is, thankfully, still a relatively rare event. Although FDA believes domestic counterfeiting is not widespread, the agency has recently seen an increase in counterfeiting activities as well as a more sophisticated ability to introduce finished dosage counterfeits into the otherwise legitimate drug distribution channels. FDA has likewise seen an increase in its counterfeit drug investigations, from approximately five a year in the late 1990s to over 20 per year since the year 2000.

At the same time, worldwide counterfeiting of drugs is believed more commonplace. The World Health Organization, as many of you know, has estimated that perhaps 7 or 8 percent of drugs worldwide are counterfeit, and reports from some countries suggest that as much as one-half of those countries' drugs are counterfeit.

The FDA initiative, as we discussed when we rolled the initiative out, is designed to better identify the risks and threats from counterfeit drugs, also to coordinate public and private efforts to fight drug counterfeiting and distribution, and to develop new tools to aid in identifying, deterring, and combating counterfeiting.

Specifically, the internal task force that we created set out several goals. The goals were to develop a strategic plan to decrease the risk of counterfeit drugs entering the United States marketplace and to protect consumers from potentially harmful effects of using these products. The second goal was to continue to strengthen FDA's collaborative relationships with other federal agencies, including Customs, the U.S. Secret Service, the Department of Homeland Security, the Department of Justice, as well as other state and federal law enforcement entities. In addition, we want to strengthen our collaboration with health professionals, industry, consumer groups, and other stakeholders who could be helpful in helping us gather information regarding the best practices for dealing with drug counterfeiting in the future.

We also wanted to identify mechanisms for strengthening the nation's protections against counterfeiting including such possibilities as model practice acts for adoption by the states, best practices for those who sell and distribute prescription drugs, and better education for patients, pharmacies and others about how to identify counterfeit drugs and alert others to their existence.

We also wanted to assess the extent to which new technologies--for example, counterfeit-resistant packaging, product identifiers such as chemical taggants, and implanted radiofrequency chips in packaging--can help assure the authenticity of drugs.

Now, although some of this technology is not currently mature enough to adequately protect the drug supply now, it may have great promise as an added countermeasure against counterfeit pharmaceutical products in the future, and that's one of the reasons why we want to be prospective in looking at this issue.

FDA believes that the increase and shift in this illicit activity has occurred for a number of reasons. These include better counterfeiting technology, including improved technology to make labeling, packaging, and products that appear real but are not; better organized and more effective criminal groups attracted by financial opportunities; the online sales of prescription drugs by unlicensed pharmacies and/or foreign websites; and opportunities for introducing foreign-made counterfeits and unapproved drugs into large and rapidly growing import flows; and also weak spots in the domestic wholesale distribution chain, including some wholesalers who acquire most of their inventory from second sources but do not necessarily maintain effective due diligence efforts on these sources and ignore warning signs indicative of illegal or unethical behavior.

As I alluded to earlier, this is a broad effort on the part of the agency. There's representation from the Office of Regulatory Affairs, the Center for Biologics, and the Center for Drugs, the Office of the Commissioner, the Office of Chief Counsel, and others within the agency. And we feel that working internally and working with all of you that we are quite confident that we'll be able to defeat the criminal element and do a better job of protecting the American public from counterfeit drugs in the marketplace. And that leads us to why we're here today.

As a part of our mandate and/or goal, we issued an interim report a couple weeks ago that contained potential options for a multi-pronged approach to combating counterfeit drugs. The potential options contained in the interim report are premised on three interim conclusions that were reached by the task force:

The first conclusion is that there is no single magic bullet against the growing number of sophisticated counterfeiters; rather, a multi-pronged strategy to secure the drug supply could be much more difficult for counterfeiters to overcome than any single method. It could also be less costly because a one-size-fits-all approach is unlikely to work for all parts of the complex prescription drug supply system.

Secondly, although drug counterfeiters today are more sophisticated and better organized, as I alluded to earlier, there are many new technologies and approaches that have the potential to prevent and contain counterfeit drug threats.

Thirdly, because many of these promising ideas have not been fully developed, the task force believes that an opportunity for broad public comment is essential to guide its further work.

And as part of our effort to glean this broad public--information to the public and to enter into a meaningful discourse, we decided to organize and hold this public meeting. We announced the public meeting as part of, obviously, our effort to combat counterfeit drugs. The purpose of the meeting is to enable interested individuals, organizations, and other stakeholders to present information on all aspects of the agency's initiative against counterfeit drugs.

We're particularly interested in hearing about information related to technology, public education, regulatory and legislative issues, and from industry and health and professional organizations regarding some of these issues. The agency has also, as you know, invited vendors of anti-counterfeiting technologies relevant to the pharmaceutical industry to display their products, and there's a room next door where that is going on.

We're excited to have this meeting. Before we start, there are some housekeeping issues that I need to discuss with you.

First of all, I just want to let you know that here at the front of the room are members of the task force and members of some of the subcommittees that stem from the task force. These are the people that have been working on the issue. These are the people who've done the work that went into the interim report. And it's their efforts that will help drive the issuance of the final report at the beginning of next year. So I want to thank all of them for their help.

I want to thank all of you for attending. We look forward to your presentations. I want to thank all the vendors.

Due to the large number of presenters, we'll need to keep to a strict schedule. Presentations will be limited to the times that were sent to you by e-mail, and the time allotted for each speaker was determined based on the size of the panel.

I also want to remind you that the meeting is being transcribed; therefore, everyone should identify themselves and the organization they represent, if any, before speaking. The transcript should be up on the website seven days after this meeting.

We have a light that will flash--and where is our light? Oh, okay. Sorry about that. We have a light up here that will flash red when the time is up. When it flashes red, we will ask the presenter to summarize and wrap up. Task force members will ask questions at the conclusion of each panel. Members of the audience will not be able to ask questions, but I do remind you that you have an opportunity to comment on anything that goes on here as well as the agency's efforts, and that these comments will be accepted until November 3rd. And as you know, if you go to our website, you'll notice that we have a docket devoted just to this initiative.

The Commissioner is due to deliver his remarks at 11:00 a.m. at the end of the morning break. If he is delayed, we will begin with panel number 3 promptly at 11:00 and interrupt when the Commissioner arrives. So I just wanted to give you that heads-up.

At the end of the meeting, we have time allotted for members of the public who have not previously asked to make presentations, we will allow you to do so. So please be patient.

Also, note that, as I said before, our Technology Forum is right next door, and we encourage all members of the audience to visit the forum to learn more about available anti-counterfeiting technologies.

Lunch is on your own. We'll begin promptly at 1:30 p.m., and lunch is not included. There was some confusion on that point, and so I just wanted to make that clear.

We look forward to an excellent meeting. I want to thank all of you once again for attending, and I'd like to call up the first panel. Thank you.

[Applause.]

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