Organised crime approach to fraudulent medicines raises concerns

Source: Pharmabiz

April 25,2013

Health: Organised crime approach to fraudulent medicines raises concerns

Vienna, 23 Apr (K. M. Gopakumar) — A draft resolution for the
consideration of the Commission on Crime Prevention and Criminal Justice
(CCPCJ) further blurs the distinction between criminal acts and
intellectual property infringement of medicines, by proposing the
involvement of transnational organised crime enforcement in addressing the
issue of fraudulent medicines.
This has raised concerns over the issue of access to affordable medicines.The 22nd session of the CCPCJ is taking place from 22-26 April in Vienna,
Austria, the headquarters of the UN Office on Drugs and Crime (UNODC).
(The CCPCJ is the central body within the United Nations system dealing
with crime prevention and criminal justice policy, including trafficking in
persons, transnational crime and aspects of terrorism prevention. The UNODC
administers the activities of CCPCJ.)

Two documents on fraudulent medicines will be considered on 25 April. The
first is a report of the Executive Director of the UN Office on Drugs and
Crime to the CCPCJ titled “Countering fraudulent medicines, in particular
their trafficking” (E/CN. 15/2013/18, hereafter “the report”). The second
is a draft resolution proposed by Argentina titled “Curbing illicit
trafficking in fraudulent medicines” (E/CN. 15/2013/L. 11, hereafter “the
resolution”).

Both the report and the resolution recommend the use of the UN Convention
against Transnational Organised Crime as a tool to address the issue of
fraudulent medicines.

The report states: “The Organized Crime Convention provides the scope for
applying the Convention to serious offences that are transnational in
nature and involve an organized criminal group. There is a compelling need
to treat trafficking in fraudulent medicines as a serious offence
established in accordance with the Organized Crime Convention”.

Further, the preamble of the resolution states: “… underscoring in that
regard the potential utility of the United Nations Convention against
Transnational Organized Crime, in reinforcing international cooperation in
the fight against trafficking in fraudulent medicines, including their
illicit production and distribution, through, inter alia, mutual legal
assistance, extradition and the recovery of the proceeds of crime, …”

However, there is no shared understanding among UNODC member sates
regarding the meaning or definition of the term “fraudulent medicine”. The
absence of clarity regarding this provides room to include infringements of
intellectual property (IP) such as trademarks and patents. Thus, the
adoption of the report and the resolution is expected to strengthen UNODC’s
criminal law approach to IP enforcement by conflating the quality, safety
and efficacy (QSE) of medicine with intellectual property rights. The UNODC
initiative is widely viewed as another organisational capture by the
pharmaceutical companies to push the IP enforcement agenda.

The report contains five parts viz. introduction; challenges in
successfully countering trafficking in fraudulent medicines; existing
frameworks and the complementary role that can be played by the UN
Convention against Transnational Organised Crime (CTOC); research
activities on the involvement of transnational organised crime in
trafficking in fraudulent medicine; and recommendations.

The report makes seven recommendations for the future work of the UNODC
with regard to fraudulent medicines:

“(a) Convene joint training seminars involving law enforcement agencies,
such as police, border police, customs and other relevant actors, to
promote greater understanding and cooperation at the national, regional and
international levels;

“(b) Provide UNODC with information and statistics on the trafficking of
fraudulent medicines involving, in particular, organized criminal groups;

“(c) Inform UNODC of technical assistance needs such as training programmes
and legislative drafting assistance in order to more effectively prevent
and combat trafficking in fraudulent medicines;

“(d) Use relevant databases and tools already developed by competent
regional and international organizations such as the European Police Office
(Europol), INTERPOL, the World Customs Organization and WHO to assist in
the fight against trafficking in fraudulent medicines;

“(e) Make use of the provisions of the Organized Crime Convention to more
effectively investigate and prosecute activities of organized criminal
groups related to the production of and trafficking in fraudulent
medicines.”

Further, it recommends the endorsement of CCPCJ to consider UNODC to
develop additional criminal justice tools and training programmes that
could be used to assess and strengthen legal and regulatory framework.
Lastly, it recommends that CCPCJ encourage the Member States to provide
extra-budgetary resources for the implementation of Resolution 20/6, in
particular to implement the technical assistance.

MANDATE ON FRAUDULENT MEDICINES WORK

Resolution 20/6 adopted at the 20th session of the CCPCJ in April 2011
provides the mandate for UNODC to work on fraudulent medicines. The first
paragraph of the preamble defines the term “fraudulent medicines”.
According to the preamble, “fraudulent medicines”, usually referred to as
“falsified medicines”, include “purported medicines whose contents are
inert, are less than, more than or different from what is indicated, or
have expired”.

This definition is problematic because the definition equates fraudulent
medicines with the term “falsified medicine”.

The operational paragraphs (OP) of the resolution state the following:

OP 1 urges Member States and international and regional institutions to
strengthen and implement measures and mechanisms to prevent trafficking in
fraudulent medicines.

OP 2 urges Member States to introduce legislation covering all offences
related to fraudulent medicines such as money laundering, corruption and
smuggling, confiscation and disposal of criminal assets, extradition and
mutual legal assistance.

OP 3 urges Member States to review their legal and regulatory framework to
provide effective legislation and improved regulatory mechanisms including
strengthening of public-private partnership.

OP 4 encourages Member States to adopt measures enhancing cross-border
cooperation including exchange of information, joint investigations,
special investigations techniques, enforcement at national, regional and
international levels and cooperation of national agencies to curb
trafficking fraudulent medicines.

OP 5 invites Member States to make strong efforts to publicise the
consequences of purchasing fraudulent medicines.

OP 6 invites UNODC to conduct further research in cooperation with other
international organisations on the modalities of organised crime including
its involvement in the issue of fraudulent medicine.

OP 7 encourages UNODC to identify key Member States in the most affected
regions and to provide corresponding technical assistance upon request.

OP 8 requests UNODC to work in close cooperation with other UN bodies and
international organisations, relevant regional organisations, national
agencies, private sector, civil society organisations and professional
associations.

ARGENTINA’S PROPOSED RESOLUTION FOR CCPCJ CONSIDERATION

The draft resolution proposed by Argentina for the ongoing 22nd session of
CCPCJ contains the following OPs:

“1. Invites the United Nations Office on Drugs and Crime to convene joint
training seminars involving law enforcement agencies, such as police,
border police and customs agencies and other relevant actors, in order to
promote greater understanding and cooperation at the national, regional and
international levels;

“2. Urges Member States to provide the United Nations Office on Drugs and
Crime with information and statistics on trafficking in fraudulent
medicines involving, in particular, organized criminal groups;

“3. Invites Member States to inform the United Nations Office on Drugs and
Crime of technical assistance needs such as training programmes and
legislative drafting assistance, in order to more effectively prevent and
combat trafficking in fraudulent medicines;

“4. Encourages Member States to make use of the provisions of the United
Nations Convention against Transnational Organized Crime to more
effectively investigate and prosecute activities of organized criminal
groups related to the production of and trafficking in fraudulent medicines;

“5. Invites Member States to provide extra budgetary resources to implement
Commission on Crime Prevention and Criminal Justice resolution 20/6 of 15
April 2011 and relevant subsequent resolutions;

“6. Requests the Secretary-General to report to the Commission on Crime
Prevention and Criminal Justice at its twenty-third session on the
implementation of the present resolution.”

This draft resolution also contains eight preamble paragraphs. The first
preamble paragraph recalls the relevant past resolutions. The second
reiterates the importance of international cooperation to fight against
illicit trafficking. The third reaffirms the willingness of Member States
to cooperate on health and crime issues and in promoting access to
medicines that are safe, affordable, effective and of good quality. The
fourth observes that sufficient supply of certain medicines and quality
assurance is still lacking. The fifth underscores the potential utility of
the CTOC in reinforcing international cooperation in the fight against
trafficking in fraudulent medicines. The sixth notes the strong mandate for
UNODC from the CTOC. The seventh recognises the need to strengthen and
implement mechanisms for tackling organised crime networks involved in the
production of and trafficking in fraudulent medicines by enhancing the
criminal justice of affected Member States. The eighth acknowledges the
information shared during the technical conference on trafficking of
fraudulent medicines held in Vienna on
14-15 February 2013.

THE CCPCJ REPORT AND ITS PROBLEMS

This report will be discussed by CCPCJ Member States this week. The second
section clearly states the absence of common position on many issues
including the use of the terminology, especially the term “counterfeit”.
The report states that stakeholders may refer interchangeably to
“counterfeit”, “illicit”, “fake”, “substandard” or “falsified medicines”.
It also quotes the definition used by Resolution 20/6. It further stresses
the need for considering offences as serious crimes. However, this section
cites the lack of adequate legal frameworks in many countries. It also
states that in many countries, the penalties are not commensurate with the
seriousness of the crime.

The third section of the report mentions the various existing multilateral
or plurilateral initiatives on medicines such as WHO’s new Member State
Mechanism on substandard/spurious/falsely labelled/falsified/counterfeit
medical products from the standpoint of public health (and not trade or
intellectual property), the Council of Europe Convention on the
Counterfeiting of Medical Products and Similar Crimes etc. However, it
proposes to address the issue of trafficking of fraudulent medicines within
the framework of CTOC.

The fourth section deals with research activities on the involvement of
transnational organised crime. It clearly cites a figure of US$150 million
as the annual import of fraudulent medicines in West Africa.

The fifth section describes the two activities carried out under the
technical assistance activities promoting the use of the UN Convention
against Transnational Organised Crime.

One of the important concerns with regard to the UNODC initiative on
“fraudulent medicines” is the lack of clarity with regard to the term ”
fraudulent medicines”. The preamble of the resolution 20/6 adopted at the
21st Session of the CCPCJ in April 2011 defines the term “fraudulent
medicine”. According to the first paragraph of the preamble of the
Resolution 20/6: “… for the purposes of the present resolution and
without prejudice to other accepted definitions or work in this area,
‘fraudulent medicines’, usually referred to as ‘falsified medicines’,
include purported medicines whose contents are inert, are less than, more
than or different from what is indicated, or have expired …”

This definition is problematic because the definition equates fraudulent
medicines with the term “falsified medicine”.

The EU Directive on Falsified Medicine defines a “falsified medicine” as a
medical product with a false representation of: (a) its identity, including
its packaging and labeling, its name or its composition as regards any of
the ingredients including excipients and the strength of those ingredients;
(b) its source, including its manufacturer, its country of manufacturing,
its country of origin or its marketing authorisation holder; or (c) its
history, including the records and documents relating to the distribution
channels used. This definition does not include unintentional quality
defects and is without prejudice to infringements of intellectual property
rights.

However, this definition explains terms such as “identity” and “source” in
a non-exhaustive manner. Therefore, these terms can be interpreted to
include infringements of trademarks or patents.

The UNODC definition of fraudulent medicine in Resolution 20/6 includes the
infringement of intellectual property and therefore can be used for IP
enforcement.

In other words, the definition of “fraudulent medicine” does not exclude IP
infringements from the scope of the definition, and accordingly could be
used to criminalise alleged IP infringement. Secondly, the definition is so
broad that it includes substandard medicines within its scope. This broad
scope would bring all the licensed manufacturers under the constant threat
of criminal prosecution. Often, circulation of substandard products occurs
without any criminal intent. Thirdly, the definition does not refer to
criminal intention, i. e. mens rea, which is the constituent element of any
criminal act.

UNODC’s approach to the circulation of medicines with compromised quality,
safety and efficacy is enforcement of criminal law especially within the
framework of CTOC. According to one developing country delegate, in the
absence of such clarity, the licensed producers who may infringe IP or
produce and sell substandard product without any criminal intent or
negligence, due to factors beyond their control, might face criminal
investigation and prosecution.

The criminal law approach without looking at strengthening of drug
regulatory authorities and access to affordable medicines is also mooted by
the International Medical Product Anti Counterfeit Taskforce (IMPACT). The
IMPACT working group has even drafted a model law. Many developing
countries rejected this approach in the WHO, realizing the limitation of
this approach.

(Due to protests from civil society groups working on public health and
several WHO Member States, IMPACT was removed from the WHO where it was
originally located.)

Another important problem with UNODC’s initiative is the lack of verifiable
evidence. UNODC has so far published four transnational organised crime
threat assessment reports. All of these reports used data from questionable
sources. For instance, the UNODC report titled “Globalization of the Crime:
A transnational Organized Crime Threat Assessment” and published in 2010
cites the Pharmaceutical Security Institute (PSI) and states that:
“According to the incident database of the Pharmaceutical Security
Institute, countries in Asia report the largest share of counterfeits
detected globally”.

Two recently published reports also use the same pattern. Further, UNODC
reports also use data from the World Customs Organisation, INTERPOL etc.
Data from these organisations substantially includes IP infringement or
violation of customs or registration laws rather than the quality of
compromised medicines. Thus, public health is not their focus.

Further, UNODC also cites documents that cannot be traced. For instance,
Paragraph 2 of the document circulated in the current 22nd session of the
CCPCJ states: “While there remains significant gaps in our understanding of
the problem, trafficking in fraudulent medicines is recognized as a major
public health threat, leading to an estimated 200,000 deaths worldwide
every year.”

Footnote No. 2 of the document referencing the number of deaths simply
cites ‘WHO2008′ without citing further details of the source to help one to
retrieve the document. One WHO observer disclosed that there is no such WHO
study in existence.

The first round of the informal consultations on the resolution proposed by
Argentina is in progress. The CCPCJ report and the resolution will be
discussed at the plenary meeting on 25 April. +

This entry was posted in Counterfeit, IP Rights and tagged , , , , , . Bookmark the permalink.

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