In recent years, the problem of counterfeit pharmaceuticals, including medicines and medical devices, has surged in scope. There are a number of factors involved, including the growing popularity of supplements and the increasingly common practice of individual customers buying their medicines online. This growing market for illicit pharmaceuticals has seen the development of a stronger law enforcement response, including international cooperation through Interpol’s Operation Pangea which has led to thousands of products being seized and websites being shut down.

For individuals, the risks of buying and consuming counterfeit medicines are clear. However, there are also risks for legitimate businesses operating in the UK market. Organisations selling pharmaceutical products in the UK, including medicines and medical devices, may be at risk of purchasing counterfeit products from a supplier. Due to problems like legitimate products being diverted, ambiguity can arise in the supply chain and help illicit products to enter the market through legitimate sources, which can make them much more difficult to address.

Here, the Business Crime, Regulatory and Criminal Defence experts at JMW Solicitors explain how counterfeit pharmaceutical products became such a large-scale and profitable industry, and what businesses need to do to protect themselves from inadvertent involvement in the supply chain of illicit medicines, devices and other goods.

What is the current scale of the illicit pharmaceuticals problem?

The problems of fake medicines and devices, legitimate products being sold illegally, and illicit drugs being disguised as supplements are all growing concerns for the British pharmaceuticals sector.

In 2022, the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) reported evidence that around 15,500 counterfeit medicine packs had entered the country over a period of around two years. In 2021, more than three million medicines and medical devices were seized by UK officers working as part of Operation Pangea, a haul worth over £9 million. The problem is international in scope and, as these numbers indicate, at a scale that is difficult to comprehend.

The biggest factor that has allowed this problem to flourish in recent years is the ability for people to buy and sell medicines and medical devices on the internet. During Operation Pangea in 2021, the UK shut down or blocked access to 113,000 illegally operating websites that were selling medical products. It is important to say that not all of these websites were selling exclusively counterfeit pharmaceuticals - this includes websites selling stolen goods, or simply supplying medicines in a way that was not in accordance with the law. Even so, it is clear that both fake medicines and medical devices, and legitimate products sold illegally, are a growing problem that the UK needs to take seriously.

Europol has also noticed the growth of this problem and proposed efforts to tackle it. In its recent report, The Other Side of the Coin, which presents an analysis of the state of financial and economic crime in the EU, the law enforcement agency identifies counterfeit pharmaceuticals as a key priority. This is vital to understand for UK businesses, as many of the products on the UK market are produced or trafficked through Europe before reaching their final destination here. The rules of free trade between Europe and the UK have created a historical precedent for this type of supply, and this is just one reason why international cooperation is necessary to tackle the problem.

From a law enforcement perspective, Europol acknowledges that this may be difficult to prevent, and that taking down websites is only a temporary way to address the issue. The report explains: “Some illicit pharmaceutical products are produced in EU-based illegal laboratories, which remain difficult to detect and require relatively few resources… Illegal online pharmacies posing as legitimate vendors have surged over the last two years. Most of the illicit trade happens particularly through temporary websites, sometimes using targeted ads on social media or instant messaging applications.”

The difficulties with detecting and shutting down small, remote laboratories producing counterfeit pharmaceuticals, and the ease with which criminals whose websites are shut down can move their operation to a new temporary website, mean that a new approach may be needed.

It also calls on businesses to be vigilant - even legitimate companies trading in pharmaceuticals are at risk of purchasing counterfeit products from suppliers. When these medicines and devices enter the market at an earlier stage and are sold to customers by legitimate businesses, it can be much harder to detect when something has gone wrong. Companies in this position must make any efforts they can to ensure they only buy from legitimate suppliers and that the products they purchase are genuine.

How can businesses avoid trading in stolen or counterfeit goods?

Pharmacies in the UK have a responsibility to uphold good distribution practice for medical and medicinal products, which can prevent fakes from reaching the market. One of the most important steps these businesses (and others) can take is to carry out robust qualification checks on suppliers. This is not only necessary in cases where you detect a particular risk - such as products with high value and low turnover that would usually only be supplied to hospitals - but in all cases. It may also be beneficial to carry out these checks on a regular basis, particularly if you receive any other indications of suspicious activity from a particular supplier.

When suppliers make unsolicited offers of high-value products, this may be an indication that they want you to buy counterfeit items. This is especially true if the supplier seems to be trying to turn medicines or devices around quickly, or exhibits suspicious behaviour. However, even while many such offers will be legitimate, it is important to carry out due diligence checks on both the supplier and the product. The MHRA website has a list of questions you should ask in these cases that can help you to identify high-risk transactions.

Pharmacies, other businesses and individuals can email the MHRA to report suspicions of counterfeit products and non-compliant medical devices. This can help to ensure that illegitimate products are removed from the market before they cause harm to customers and help your business to avoid any liability for selling counterfeit goods, whether inadvertently or not.

If you are under investigation or have been accused of selling counterfeit products, speak to a solicitor at your first opportunity. The business crime defence experts at JMW have a wealth of experience representing and defending businesses against allegations like these, and can help you to mount a viable defence. We will work tirelessly to make sure your case is represented truthfully and in the strongest possible terms, and to ensure you are treated fairly at all stages of the court process.

Speak to the experts at JMW Solicitors today by calling 0345 872 6666, or allow us to call you back at a convenient time for you by completing our online enquiry form.