(Remember last year’s series on the Underground Economy? Refresh your memory with this Bold story on the economics of the illicit drug trade, then read this timely new installment below.)
Pharmaceutical prices in the U.S. are high, and many policymakers have called for better solutions. New drugs in the market carry tremendous costs in research and development that require higher pricing to consumers, so when a medication or new class of drugs prove to be beneficial, their costs often portray the dozens of ones before them that failed trials. It’s not surprising that many of the new weight loss drugs belonging to the GLP-1 category are rather pricey. However, it’s also not surprising some are trying to scam consumers with counterfeit or diverted drugs. International suppliers of fake drugs are on the rise, and this especially pertains to today’s popular weight loss drugs.
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Many of the counterfeit or diverted drugs being seen today involve weight loss medications that are relatively new to the market. These include knock-off or fake versions of Ozempic, Wegovy, and Mounjaro. In many cases, these false medications are originating overseas from a few hot spots where international suppliers of fake drugs operate. But some also launch from within the U.S. as well. Battling these suppliers is a never-ending struggle require federal, pharmaceutical, and private industry efforts. Despite these efforts, however, hundreds if not thousands of consumers purchase such products placing their health and safety at risk. This is why exposing this underground market is essential, particularly as it relates to consumers.
“We are seeing a lot of diverted medicines coming in from Europe and South America. But for counterfeits, a lot of what we’re seeing currently in the United States.” – Nicole Johnson, National Program Manager for the Intellectual Property Rights Coordination Center
Exploiting Gaps in Supply and Demand
One of the drivers the rise of international suppliers of fake drugs is the rising demand for weight loss medications. GLP-1 drugs essentially mimic a natural hormone in the body called glucagon-like peptide 1. This hormone suppresses appetite and also increases insulin production from the pancreas. As a result, drugs in this classification help people lose weight and keep it off while also better managing diabetes risks. A handful of these types of medications are available and approved by the FDA. But they all are expensive. Generally speaking, the cost for a 1-month supply in the U.S. is about $1,000. For many people, this isn’t feasible. And for others, their providers will not prescribe them if they fail to meet criteria. As such, many counterfeit or diverted drugs are being marketed to these potential buyers.
In many cases, people are searching for deals on GLP-1 drugs in social media sites. However, as is often touted, good deals are indeed too good to be true. For example, some counterfeit or diverted drugs may be sold for as little as a couple of hundred dollars. By definition, a counterfeit drug is one that appears to be legitimate based on product packaging and labeling. However, the contents are not legitimate and are often something completely different. Diverted drugs, on the other hand, are actual GLP-1 medications that have not been approved for sale in the U.S. Diverted drugs are more common in foreign countries with the international suppliers of fake drugs on the rise. Among the most common foreign origins include India, China, Mexico, the UK, and Turkey.
“I am not surprised, unfortunately, any of these new type of drugs that we’re seeing, whether it be weight loss drugs or other drugs. We’ll see them either diverted, counterfeited or illegally shipped through this facility.” – Sal Ingrassia, Port Director, U.S. Customs and Border Protection, JFK International Airport
Common Scams and Workarounds
In considering international suppliers of fake drugs, those dealing in weight loss can operate in a number of ways. For diverted drugs, some have stockpiled actual GLP-1 medications in advance anticipating opportunity. For example, in Turkey, some pharmaceutical companies there acquired weight loss drugs and then resold them on the black market. Because they are not approved for sale in the U.S., they are considered diverted, which is a federal offense. Other such suppliers fake packaging and provide saline or even insulin in their devices. Insulin pens, for example, may be remade to look like Ozempic pens and sold to unsuspecting buyers abroad. Many may have obesity conditions or diabetes and need the medication but are unaware of potential risks. Counterfeit or diverted drugs sold like this are both dangerous, especially those containing other pharmaceutical agents.
Within the U.S., scammers often acquire actual Ozempic pens or medical devices that have already been used. They then simply refill these devices with saline or other substances. These types of suppliers can be just as hard to catch as international suppliers of fake drugs. This is particularly true when sold via Facebook or TikTok. Though illegal to sell drugs on these platforms, policing the policy is challenging. For international suppliers of fake drugs, these may be detected at international mail facilities. However, many choose to go outside of legal supply chains to access consumers. And even those caught may not receive any penalty. Unless part of a federal investigation, international mail centers are required to send medical devices back to senders. This is true even if they find devices dealing with counterfeit or diverted drugs.
“We saw that the demand [for GLP-1 drugs] increased and quite often as it happens in these situations, criminals try and fill a gap where the supply and demand aren’t balanced for a particular product.” – Andy Morling, Deputy Director of Criminal Enforcement, U.K. Medicines and Healthcare Products Regulatory Agency
Black Market Weight Loss Drug Solutions
Notably, solutions are needed to address counterfeit and diverted drugs for weight loss. The FDA has a number of such investigations in progress and have made some strides. At the JFK International Airport mail center, nearly 200 illegal Ozempic products were identified in 2023. But this is a small fraction when it comes to international suppliers of fake drugs for weight loss. As such, the federal government is partnering with pharmaceutical companies as well as private industries. Brandshield, a cybersecurity firm, has strategies to identify fake GLP-1 companies and shut down their sales sites. The company shut down roughly 250 social media sites last year alone. Naturally, much more needs to be done including finding ways for more affordable pharmaceutical solutions. When demand exceeds accessible supplies, black markets fill the gap. Therefore, developing better market solutions offers the best strategies to squash the sale of counterfeit or diverted drugs.
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