Does Crime Pay When It Comes to Fake Drugs?

Does Crime Pay When It Comes to Fake Drugs?
Tommy Farmer/Tennessee Bureau of Investigation via AP
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The purpose of penalties such as fines and jail time is to address and correct perpetrators’ bad behaviors, whilst signaling to others that illicit behavior will not be tolerated – “crime will not pay.” However, when it comes to the business of counterfeit prescription medications, law enforcement falls far short as an effective deterrent.

Fake and contaminated drugs are deadly, and they represent a $100 billion per year industry that costs one million jobs in the United States. These drugs are often ineffective and frequently have diluted or no active ingredients, and they can contain toxic substances that have adverse and even deadly consequences for patients.

These drugs are often manufactured in contaminated locations, and in countries with no FDA monitoring. These pharmaceuticals are frequently stored at unsafe temperatures and then sold to the public – often over the Internet. While patients are seeking out affordable drugs on the web that they hope will address their ailments, the process can be referred to as Internet roulette. It may not be Russian roulette but it is still deadly.

For example, fake versions of Fentanyl, the drug that contributed to the death of recording artist Prince, kill hundreds of consumers in the United States each year. In just one week in Sacramento, the counterfeit pill led to 42 overdoses and 10 deaths

While these drugs reach consumers through the Internet, they are also being sold on the street and, in rare circumstances, have even crept into the American medical supply chain. Cancer patients have been given medications containing salt and starch, and, in another instance, counterfeit medications were given to a liver transplant patient. These fake drugs are being misbranded and mislabeled as Botox, for use in weight loss, and to address a whole host of ailments, including heart disease, arthritis, Parkinson’s disease, and HIV-AIDs.

Can this crisis be stemmed?

Recent analysis by the Washington Legal Foundation (WLF) of the Food, Drug, and Cosmetic Act (FDCA) found disparities in penalties doled out to criminals involved in the counterfeiting and diversion of these medications. According to the analysis, drug traffickers who are found guilty of diverting a legitimate medication intended for Europe to the United States could face a felony charge, while counterfeiters who are found guilty of selling or dispensing fake drugs in the United States may face only a light misdemeanor.

The WLF research found that even some diversions are treated differently than others, such as those involving the sale of U.S. drugs produced in foreign countries and intended for sale outside the United States. These confusing disparities in the FDCA need to be addressed immediately. Weak penalties do more than simply embolden criminals; they provide insufficient incentives for law enforcement to punish illegal importers. The hard work of chasing down and prosecuting lawbreakers isn’t worth the measly fines currently allowed under U.S. law.

Because enforcement is very difficult to carry out, perpetrators are often moving targets, and the sheer number of perpetrators makes apprehension and prosecution more difficult. Increasing penalties for counterfeiting has been a consensus view for some time: According to one study, the vast majority of consumers want to see stronger penalties, and stiffer penalties for bad behavior.

Economics teaches us that market decisions are often made as a tradeoff of costs and benefits.  Work advanced by the late Nobel Prize Economist Gary Becker shows us that this notion applies to criminals as well.  Simply put, weak penalties for counterfeiting and selling fake drugs encourages illicit activity. It’s time for Congress to update the FDCA to include stiffer fines for the manufacturing and selling of fake drugs.

Steve Pociask is president of the American Consumer Institute, a nonprofit educational and research organization. For more information about the Institute, visit or follow Steve on Twitter (@ConsumerPal).

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