Free trade in counterfeit drugs

The New York Times has an extensive piece today on the role of free trade zones in enabling the trade in counterfeit drugs (Counterfeit Drugs’ Path Eased by Free Trade Zones). The article describes how the seizure of drugs in a free-trade zone in Dubai led to an unraveling of fraud in Canada:

… an examination of the case reveals its link to a complex supply chain of fake drugs that ran from China through Hong Kong, the United Arab Emirates, Britain and the Bahamas, ultimately leading to an Internet pharmacy whose American customers believed they were buying medicine from Canada, according to interviews with regulators and drug company investigators in six countries.

Some pills, a government official said at the time, contained cement powder.

The trail went through the Bahamas:

The site belonged to RxNorth, described by one trade association as the world’s first major online pharmacy.

A founder, Andrew Strempler, had been the subject of numerous profiles, including one in The New York Times in 2005 that described how at the age of 30 he had two Dodge Vipers, a Jaguar and a yellow Lamborghini with a license plate that reads “RX Boss.”

The article reported that Mr. Strempler’s innovation “created a whole new Canadian industry that has plugged a niche in America’s troubled health care system almost overnight, providing about $800 million worth of low-cost drugs a year to two million uninsured and underinsured Americans, many elderly.” Drugs have traditionally been cheaper in Canada…

As Mickey says, “At least with medical tourism you know what country you are in.”

I’d also be willing to bet that Pfizer’s PR people were the impetus for this story.

December 17, 2007

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