Drug Authentication and Cost of Counterfeiting to Economy

James Emejo writes that allocating funds for the enforcement of the Mobile Authentication Scheme for pharmaceuticals and other products will check widespread counterfeiting which has bedeviled the economy

Worried by the devastating impact of products counterfeiting, particularly pharmaceutical, on human lives and the Nigerian economy in general, the House of Representatives had in July last year directed the National Agency for Food and Drug Administration and Control (NAFDAC), Consumer Protection Council (CPC), and the Standard Organisation of Nigeria (SON) to ensure that Mobile Authentication Service (MAS) is reactivated and applied to all drugs purchased in the country.

The lawmakers further urged NAFDAC to as a matter of urgency, begin a nationwide publicity on MAS for the education and enlightenment of the public as well as mandated its committee on Health Services to ensure compliance with the resolutions.

The resolution of the lower house resulted from a motion sponsored by Hon. Babajimi Benson (APC, Lagos) on the need to carry out the directive to save lives.

He had expressed concern that drug counterfeiting remained a major cause of death of many citizens.
Benson, while leading the debate said fake drugs undermine every aspect of medical treatment and healthcare delivery and constitute the major cause of suffering and death of many Nigerians.

Worse still, the lawmaker had argued that counterfeiting of drugs contributed negatively to the well being of Nigerians while the illicit trade did also escalated within the country’s health care system in recent times.

Mobile Authentication Service
Essentially, MAS allows globally unique codes for each product unit made by genuine drug manufacturers or distributors. The codes can be delivered as labels based on the manufacturer’s preference or drug package. Coded drugs are shipped from the distribution network to the point of sale.

To verify the authenticity of the product, the consumer at the point of sale scratches or peels off the tamper evident layer to reveal the unique code.

The consumer sends the code to Sproxil, the solution’s service provider, using one of several options including SMS, Sproxil consumer app, toll free call center or the Sproxil’s website.
A verification response is immediately sent to the consumer informing them of the authenticity of the product.

Role of NAFDAC
NAFDAC plays a major role in ensuring that all stakeholders comply with the regulations while the mobile network providers are responsible for ensuring messages are sent and received without any network glitch or errors.
The regulatory agency had in 2010 initiated the MAS by pharmaceuticals companies nationwide in its efforts to combat counterfeit drugs circulation.

However, concerns had been expressed that in recent times, there has been a reduced campaign on the authentication process while most over the counter drugs and infant syrups do not have the unique 12 digit PIN authentication.
The house had also accused NAFDAC and SON of negligence on their part, which had led to the influx of fake and counterfeit drugs in Nigerian markets in particular and the health sector general, adding that fake drugs are a major cause of untimely deaths in the country.

Capacity Requirements
However, reacting to the directive of the House on MAS enforcement on drugs, the Director General of NAFDAC, Prof. Mojisola Adeyeye, though applauded the lawmakers over the noble resolution, pointed out that the agency currently lacked the staff capacity and funding requirements to carry out the enforcement.
According to her, the suggestion by the lawmakers to use MAS for all drugs regulated by NAFDAC was as good as it fell in line with the agency’s ultimate agenda.

“However, a lot of staffing and funding will be needed for full implementation. The limited authentication that is being undertaken currently for the two classes of drugs (antimalarials and antibacterials) by NAFDAC sometimes result in overwhelming calls to the drug information specialists at NAFDAC secretariat.

“Considering the fact that NAFDAC has over 11,000 registered drug products, the manpower that will be needed to authenticate all drugs will be enormous. In addition, the information technology unit of NAFDAC will also need to network with NAFDAC offices in the 36 states in all six geographical zones and Abuja. Therefore, NAFDAC will need to expand the drug information center with higher bandwidths and computers. I will implore the National Assembly to fund NAFDAC to achieve this noble and necessary cause that the honourable speaker had suggested.

“In addition, all manufacturers will also need to retrofit their labeling lines in order to accommodate the MAS codes. This is attainable except that the manufacturers will need a tax break in order to accommodate these changes, knowing that, in Nigeria, all manufacturing equipment pieces, all raw materials are imported. Therefore I will urge the Honourable Speaker to facilitate tax break for manufacturers. This will improve trade and encourage more local manufacturing, knowing the importance of safeguarding the health of the public.”

Growing Threat
Nevertheless, the Managing Director, Sproxil Nigeria, Mr. Chinedum Chijioke told THISDAY that it understood NAFDAC’s predicament regarding the house directive on MAS, adding however, that it represented the right step to take as the enforcement will significantly reduce the impact of counterfeiting in the country.
Quoting a World Health Organisation (WHO) report, he said counterfeit medicine had become a growing threat with a high number of cases recorded in Africa while a number of deaths had also been attributed to counterfeit drugs on a yearly basis.

He said: “This causes a growing concern for not just the individual but also the government as no one is spared from this crippling menace. Counterfeiters have become increasingly bold in their activities as they make use of sophisticated machineries to imitate genuine products, creating the exact replica that can fool anyone.
“Counterfeiting has also caught a foothold in virtually every industry within the Nigerian economy, their activities have gone beyond anti-malaria or anti-biotics to include other drugs that innocent citizens make use of.”

He said: “Knowing that this has gone far beyond the confines of the above listed drugs, NAFDAC has to be ahead and on-top of this. The regulatory agency and the approved MAS providers have to be 10 steps ahead the counterfeiters and the expansion of the Mobile Authentication Service is one way to get ahead of these fraudsters.”

Penalty for Defaulters
Chijioke also urged the regulatory agency including relevant stakeholders to go beyond product authentication to cover locating and penalising the counterfeiting culprits to serve as deterrent.
According to him: “With our intelligence gathering mechanism, we discovered for one of the products on our platform that counterfeit activities are prominent in the South-west region with a record of 34 per cent of the flagged products traced back to this region; this was followed closely by the South-south and South-east regions at 24 per cent and 17 per cent respectively. The region with the least recorded counterfeit trade activity for this particular product was the North-east with 5 per cent. This report was derived from the Sproxil 2018
Third Party Investigation (TPI) report and covered a period of six months.”

He stated that though there had been mixed responses from players in the pharmaceutical industry, most manufacturers and brand owners understood the implications of counterfeit activities on their brand’s reputation and the consumers they serve.
He said:”Hence, we are confident of their willingness to cooperate and collaborate in order put an end to this menace. Our clients within this sector have experienced first-hand the impact Mobile Authentication Service has on their business.”

Dangers of Counterfeiting
Further highlighting the dangers of counterfeiting to the growth of the economy, the Sproxil boss added: “Counterfeit drugs are a threat to the life of every individual who comes in contact with them. So grave is this problem that it affects the economy as a whole. It reduces the value of genuine products as counterfeit products are for the most part cheaper than their original counterparts and consumers generally tilt towards products that are cheaper as long as they perceive that the product might give them the same or similar value.

“A considerable percentage of the Nigerian pharmaceutical market is saturated with counterfeit drugs denying genuine product manufacturers of the revenue they would otherwise have generated if their products were not being counterfeited. Also, consumers lose trust in genuine products when they purchase a counterfeit product and realize that the product is not as effective as it claims to be.

“This, in turn, affects the revenue the government generates as fake products are sold illegally and are tax evasive. In addition, counterfeit drugs decrease individual and national productivity and increase death rate. Investors are also deterred from making investments in research and further market development because of the fear of not being able to recoup their investments due to impact of counterfeiting.”

The overall argument is for the federal government to strengthen the enforcement of the authentication system for pharmaceuticals and other products to reduce their negative impact on consumers and economy at large as well as the fact that no financial intervention in this regard will be too much in an effort to safeguard the lives of Nigerians.