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Donfucius Says: October 24th, 2014. Random Bits Of Wisdom.

  1. “As a child my family’s menu consisted of two choices: take it or leave it!” — Buddy Hackett
  2. “Nature gave men two ends – one to sit on and one to think with. Ever since then man’s success or failure has been dependent on the one he used most.”Donfucius
  3. Preach the Gospel at all times, and when necessary use words.” — Aaron Rogers Quoting Francis of Assisi
  4. “Diplomacy is the art of saying “Nice doggie” until you find a rock.” — Will Rogers
  5. “Before they invented drawing boards, what did they go back to?” –Patti Molloy
  6. “The way we’re going… if I called up another pitcher, he’d just hang up the phone on me.” — Any Brewers Manager
  7. “When someone is impatient and says I haven’t got all day,” I always wonder, “How can that be? How can you not have all day?” — George Carlin
  8. “We’re fools whether we dance or not, so we might as well dance.” — Old & Wise Japanese Proverb
  9. “Blessed are the cracked – for they are the ones who let in the light.” — Donfucius
  10. “Good judgment comes from experience, and a lot of that comes from bad judgment.” — Will Rogers
  11. “I don’t mind how much my Ministers talk, so long as they do what I say.” — Margaret Thatcher

ATL
ATL's Anti-Counterfeiting Digest

Category 1
October 24th, 2014

The Jar, Large Pebbles, Small Pebbles, Sand, & Coffee

When things in your life seem almost too much to handle, when 24 hours in a day are not enough, remember the empty jar and the 2 cups of coffee.

A professor stood before his philosophy class and had some items in front of him.
When the class began, he wordlessly picked up a very large and empty jar and proceeded to fill it with large pebbles. He then asked the students if the jar was full. They agreed that it was.

The professor then picked up a box of smaller pebbles and poured them into the jar. He shook the jar lightly. The smaller pebbles rolled into the open areas between large pebbles. He then asked the students again if the jar was full. They agreed it was.

The professor next picked up a box of sand and poured it into the jar. Of course, the sand filled up everything else. He asked once more if the jar was full. The students responded with a unanimous ‘yes.’

The professor then produced two cups of coffee from under the table and poured the entire contents into the jar effectively filling the empty space between the sand. The students laughed.
‘Now,’ said the professor as the laughter subsided, ‘I want you to recognize that this jar represents your life.

The large pebbles are the important things-your family, your children, your health, your friends and your favorite passions-and if everything else was lost and only they remained, your life would still be full. The smaller pebbles are the other things that matter like your job, your house and your car. The sand is everything else-the small stuff.
‘If you put the sand into the jar first,’ he continued, ‘there is no room for the large or small pebbles.
The same goes for life.

If you spend all your time and energy on the small stuff you will never have room for the things that are important to you. Pay attention to the things that are critical to your happiness. Spend time with your children. Spend time with your parents. Visit with grandparents. Visit with your Aunts. Take your spouse out to dinner. Play baseball, soccer, or cards, anything with human contact. There will always be time to clean the house and fix the disposal.

Take care of the large pebbles first – the things that really matter. Set your priorities.
The rest is just sand.

One of the students raised her hand and inquired what the coffee represented. The professor smiled and said, “I’m glad you asked.”

The coffee just shows you that no matter how full your life may seem, there’s always room for a cup of coffee with a friend.


February 18th, 2014

Snow Emergency?

Here in Menomonee Falls, Wisconsin, it has been a harsh winter. The following story is re-created from the recent past:

On a bitterly cold winters morning a husband and wife were listening to the radio during breakfast. They heard the announcer say, “We are going to have 8 to 10 inches of snow today. You must park your car on the even-numbered side of the street, so the snow plows can get through. So the good wife went out and moved her car.

A week later while they are eating breakfast again, the radio announcer said, “We are expecting 10 to 12 inches of snow today. You must park your car on the odd numbered side of the street, so the snow plows can get through.”
The good wife went out and moved her car again.

The next week they are again having breakfast, when the radio announcer says, “We are expecting 12 to 14 inches of snow today. You must park.” Then the electricity went out. The good wife was very upset, and with a worried look on her face she said, “I don’t know what to do. Which side of the street do I need to park on so the snow plows can get through?”

Then with the love and understanding in his voice (that all men who are married a long time exhibit), the husband replied, “Why don’t you just leave the car in the garage this time.”


August 2nd, 2012

Feds Seize Nearly $15 Million From Investment Account Of Fugitive In ICE Counterfeit Software Cases.

Forfeited Funds Generated By Internet Sales Of Phony Antivirus Software.

Story courtesy of the IACC (International Anti-Counterfeiting Coalition).

SAN JOSE, Calif. Federal authorities have seized nearly $15 million from a Swiss bank account belonging to a former Bay Area man who fled the country following his indictment three years ago on federal charges for selling millions of dollars worth of counterfeit antivirus software over the Internet.

The seizure last week of $14.8 million from an investment account in Switzerland is the latest federal enforcement action involving Shaileshkumar “Sam” Jain, 41. Jain was initially indicted in March 2008 by a grand jury in San Jose, Calif., for trafficking in counterfeit goods, wire fraud and mail fraud following a probe by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). That case is being prosecuted by the U.S. Attorney’s Office for the Northern District of California.

In March 2010, the U.S. Attorney’s Office for the Southern District of New York filed a civil complaint alleging that Jain and others had transferred millions of dollars from their scheme into a Swiss bank account. Those funds were forfeited to the United States and the forfeiture was completed on May 31, after the Swiss government wire transferred the funds to the U.S. Treasury in compliance with a federal seizure warrant issued in the Southern District of New York. The U.S. Attorney’s Office for the Southern District of New York also indicted Jain on domestic and international money laundering charges in May 2010.

ICE HSI’s criminal investigation into Jain began in 2007 after the agency received information he was selling counterfeit Symantec antivirus software on various Internet websites. According to the seizure warrant, Jain lured potential customers to his websites by “spamming,” sending unsolicited emails to prospective Symantec customers, and by automatically “redirecting” potential Symantec customers to fraudulent websites. After customers provided their credit card information to purchase what they believed were authentic Symantec products, Jain fulfilled the orders by shipping counterfeit software from a facility in Ohio. To hide the proceeds from his criminal activities, Jain established shell corporations here and overseas and opened bank and investment accounts in the United States, Uruguay and Switzerland.

As this seizure makes clear, intellectual property thieves should be aware that law enforcement will use every available tool to keep them from profiting from the theft of others’ products, creativity, and ideas,” said ICE Director John Morton. “HSI’s investigative work in this case is very much ongoing and we’re continuing our efforts to locate this fugitive so he can be brought to justice for his crimes. We’re also hopeful some of his ill-gotten gains will soon go to compensate the legitimate software maker that lost millions as a result of this scheme.”

Last month’s action marks the second significant monetary forfeiture in this case. In April 2008, the U.S. Attorney’s Office for the Northern District of California obtained a warrant for the seizure of more than $650,000 in funds from two East Coast investment accounts that held proceeds from Jain’s illegal Internet sales.

Jain, who surrendered to ICE HSI agents here in May 2008, has been a fugitive since January 2009 when he failed to appear for two scheduled hearings related to his case in U.S. District Court in San Jose, Calif. HSI agents are continuing efforts to locate him so he can be extradited to the United States to face the current charges. Anyone with information about Jain’s possible whereabouts is urged to contact ICE’s 24-hour tip line – 1-866-DHS-2ICE.

ICE HSI in San Jose received substantial assistance with the case from HSI agents in New York City and the agency’s overseas attach offices in Buenos Aires, Argentina, Brasilia, Brazil, and Bern, Switzerland, as well as from the Internal Revenue Service – Criminal Investigations in San Francisco.


July 29th, 2011

We Congratulate ATL Employee Tiffany Duncan For Her Selection To WI High School “All Star Soccer Team”

Tiffany Hartford All Star

Photo Above: Wisconsin High School All Star Tiffany Duncan (left), and Donald Dobert, President, ATL.

Athletes, coaches, and game attendees from throughout Wisconsin will converge on Middleton on July 30th, 2011 for the All Star Soccer Camp and Games. The event is sponsored by The Wisconsin Masonic Soccer Foundation (WMSF). In addition to giving statewide recognition to Wisconsin’s finest high school players, there will be a soccer camp for financially underprivileged kids between the ages of 11 and 13. There are no charges to the families of the young camp attendees.

Past sponsors include car dealers, insurance companies, banks, and the Green Bay Packers.

All Mason’s, families and friends are invited to join the All-Stars and Youth Campers for the 2011 Friday Night Cookout at 5:30 p.m., on July 29, during the 20th Anniversary Masonic Soccer Camps. The Cookout will be held at Fireman’s Park in Middleton near the High School and is hosted by Middleton Lodge No. 180.

The cost is just $5.00 per person. All Former Committee and Foundation members are encouraged to attend. Reservations are required.

Saturday, July 30, everyone is invited to recognize the All-Stars and Youth Campers at the Recognition Breakfast to be held at Middleton High School at 8:00 a.m. The cost is $15.00 per person and reservations are required.

Following the breakfast, support the teams by attending the 20th Anniversary Games at the Middleton High School soccer field. The cost is just $10.00 per person and includes admission to both games: the girls’ game at 11:00 a.m. and the boys’ game at 1:00 p.m.

Raffle tickets and souvenirs will be available. A raffle drawing will be held between the games. Concessions will be served by Middleton-Ionic lodge No. 180.

For reservations for the cookout and breakfast contact David Tainter at dtainter@wi.rr.com or 262-689-2848.

ATL is very proud that employee Tiffany Duncan has been selected as an All-Star. Tiffany graduated from Hartford Union High School on June 5th, 2011. Tiffany works part time at ATL in Quality Assurance. She will be attending the University of Dubuque (Iowa) starting in late August. Tiffany will be playing soccer for her new college. Her team is the University of Dubuque Spartans. Tiffany’s major will be criminal justice. We congratulate her on her achievments.



June 22nd, 2011

Baltimore Store Owner Sentenced To 30 Months In Prison For Selling Counterfeit Luxury Apparel And Accessories

Story courtesy of the IACC (International Anti-Counterfeiting Coalition).

3,600 counterfeit items seized from three stores worth over $400,000.

BALTIMORE A Maryland man was sentenced to 30 months in prison followed by three years of supervised release for selling counterfeit items with brand names such as Coach, Louis Vuitton, Dolce & Gabbana, Prada, Chanel, Gucci, Polo and Nike. The sentence is the result of an investigation conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Maryland State Police and Baltimore County Police Department.

Marvin Anthony Johnson, 47, of Baltimore, was sentenced by U.S. District Judge Catherine C. Blake for trafficking in counterfeit goods. Johnson is also required Johnson to forfeit $23,957 in unlawful proceeds seized by law enforcement in September 2010.

The sentence was announced by U.S. Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of ICE HSI in Baltimore; Colonel Terrence Sheridan, Superintendent of the Maryland State Police; and Chief James W. Johnson of the Baltimore County Police Department.

“Counterfeiters like Mr. Johnson rip off consumers by selling sub-standard products,” said Special Agent in Charge Winter. “The protection of intellectual property is a top priority for HSI, as counterfeit products represent a triple threat by delivering shoddy and sometimes dangerous, goods into commerce, by funding organized criminal activities and by denying Americans good-paying jobs.”

According to his guilty plea, Johnson owned and operated a retail store known as “Prestigious Fashions” located at 501-A Pennsylvania Avenue in Baltimore; a sales booth known as “Marvin’s Prestigious” located within the North Point Flea Market on North Point Road in Baltimore; and another sales booth within Hunter’s Sales Barn, located on Jacob Tome Memorial Highway in Port Deposit, Md. From July to Sept. 3, 2010, Johnson sold counterfeit luxury apparel and accessories from those stores that bore trademarks identical to trademarks used by Coach, Louis Vuitton, Dolce & Gabbana, Prada, Chanel, Gucci, Polo and Nike.

In August 2010, undercover Baltimore County Police officers twice purchased counterfeit goods from Johnson at the two sales booths. Johnson said the items were “fake” and also told undercover officers that he hosts “purse parties” in order to sell the counterfeit items. Baltimore County police officers observed Johnson selling other counterfeit goods.

On Sept. 2 and 3, 2010, law enforcement executed search warrants at six locations and vehicles associated with Johnson and seized approximately 3,600 items of counterfeit luxury wearing apparel and accessories with the above stated brand names, among others. The lost retail value, or infringement amount, of the goods seized is estimated to be between $400,000 and $1 million. Officers also seized approximately $23,957 in cash. Also located in Johnson’s van was a cease and desist letter from Coach, directed at the owners/operators of a flea market, and outlines the illegalities of selling counterfeit goods. Johnson’s handwriting appeared on the back of the letter in which he made notations regarding further sales of counterfeit goods.

The HSI-led National Intellectual Property Rights Coordination Center (IPR Center) stands at the forefront of the U.S. Government’s response to global intellectual property (IP) theft. As a task force, the IPR Center uses the expertise of its member agencies to share information, develop initiatives, coordinate enforcement actions, and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public’s health and safety, the U.S. economy and the war fighters. To learn more about IP theft, please visit www.IPRCenter.gov.

U.S. Attorney Rod J. Rosenstein commended ICE HSI, Maryland State Police and Baltimore County Police Department for their work in the investigation.

Mr. Rosenstein thanked Assistant U.S. Attorney Sandra Wilkinson who prosecuted the case.


June 9th, 2011

Chinese National Sentenced To More Than 7 Years In Federal Prison For Trafficking Counterfeit Pharmaceutical Weight-Loss Drug

Story courtesy of the IACC (International Anti-Counterfeiting Coalition).

DENVER- A Chinese national was sentenced on Thursday to serve seven years and three months in federal prison for trafficking in counterfeit versions of the pharmaceutical weight-loss drug known as “Alli.” The sentence was pronounced by U.S. District Judge Philip B. Brimmer.

This case was investigated by the following federal agencies: U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), U.S. Food and Drug Administration’s Office of Criminal Investigations (FDA OCI), and the U.S. Postal Inspection Service.

Shengyang Zhou, aka “Tom,” 31, of Kunming, Yunnan, China, was ordered to pay restitution totaling $504,815.39 to the victims of his crime, including an emergency room doctor from Texas who suffered a mild stroke from ingesting the counterfeit medication. Following his prison sentence, Zhou will be deported. He appeared at the sentencing hearing in custody, and was remanded immediately following the hearing.

Zhou was first charged by Criminal Complaint on March 5, 2010. He was arrested based on a Criminal Complaint on March 23, 2010 in Honolulu, Hawaii. Zhou was indicted by a federal grand jury in Denver on April 22, 2010. The government sought a superseding indictment on Nov. 17, 2010. He pleaded guilty on Jan. 24, 2011 and was sentenced June 2.

According to court documents, between December 2008 and March 2009 the FDA issued a series of alerts on its website concerning tainted weight-loss pills and counterfeit drugs. Initial alerts focused on “Superslim,” “2 Day Diet,” and Meitzitang, among other purported weight-loss products believed to have been imported from China and marketed as dietary supplements or nutritional products. The FDA stated in these initial alerts that the items posed a very serious health risk to consumers, because, based on analysis, they were found to be drugs that contained undeclared active pharmaceutical ingredients, including Sibutramine (a non-narcotic controlled substance).

Sibutramine can cause high blood pressure, seizures, tachycardia, palpitations, heart attack or stroke. In later alerts, the FDA warned the public about counterfeit versions of the brand-name drug Alli, a popular over-the-counter weight-loss drug manufactured by GlaxoSmithKlein. The alerts indicated that these counterfeit drugs were also being imported into the United States from China and did not contain the proper active pharmaceutical ingredient for the authentic product; instead they contained dangerous levels of Sibutramine. The counterfeit versions of Alli were being sold in the United States, among other ways, through Internet websites, including online auction websites, such as eBay.

During the course of the investigation, law enforcement agents identified Zhou as the trafficker and importer into the United States of these counterfeit and unapproved purported weight-loss-related drugs. Zhou also identified himself as the manufacturer of the counterfeit Alli.

Zhou’s website, “www.2daydietshopping.com,” indicated that his business operated a U.S. branch out of Plano, Texas. Agents determined through investigation that the branch was operated by Qing Ming Hu, a naturalized U.S. citizen born in China. Some of the unapproved product featured in FDA public alerts was shipped to Hu for re-distribution to U.S. customers. Hu was also prosecuted, and received a sentence of three years probation.

Agents acting in an undercover capacity placed numerous orders for the counterfeit and illegal diet pills. In turn, money was wired to bank accounts. At one point, two agents flew to a third country in an undercover capacity to meet with Zhou. At that meeting they discussed in depth Zhou’s manufacturing capabilities. Zhou identified himself as the manufacturer of the counterfeit Alli and promised to fix defects in the counterfeit versions of the Alli he had previously shipped, defects that had been noted by the FDA in its public alerts. During that meeting the undercover agents told Zhou that they had access to a private customs broker who would be willing to import the counterfeit Alli into the United States through air cargo shipments that would be mis-described.

As the investigation continued, undercover agents and Zhou agreed to meet in Hawaii to discuss increasing the order for counterfeit Alli. At that meeting Zhou provided proof that he was capable of producing large quantities of Alli, and that he had cured certain imperfections. At the end of the meeting, agents handed Zhou cash to complete the Alli order transaction. At that point, Zhou was arrested.

A number of consumers reported feeling an assortment of adverse physical effects from taking the counterfeit Alli that they had purchased from the defendant’s web page or through a re-distributor. One consumer, an emergency room doctor, suffered a mild stroke after ingesting the counterfeit Alli.

“Today’s sentence demonstrates what can be accomplished when the FDA Office of Criminal Investigations, ICE Homeland Security Investigations, and U.S. Postal Inspection Service combine resources to investigate and apprehend an international criminal whose actions were harming Americans,” said U.S. Attorney John Walsh, District of Colorado. “Those who rely on the Internet to obtain their prescription medication must do due diligence to ensure they are dealing with a reputable company providing the actual medicine prescribed by a physician.”

“After working closely with our law enforcement counterparts to secure a conviction following our extensive investigation, this prison sentence sends a strong message to current and potential pharmaceutical counterfeiters of the consequences that await them,” said David M. Marwell, special agent in charge of ICE HSI in Denver. “This case demonstrates how our agents pooled their experience, expertise, and law enforcement authorities to shut down this criminal enterprise, and help protect the public.”

“FDA’s Office of Criminal Investigations, working in concert with the United States Attorney’s Office and other foreign and domestic government agencies, will protect the public health by aggressively targeting those responsible for counterfeiting pharmaceutical drugs,” said Patrick J. Holland, special agent in charge of the FDA Office of Criminal Investigations Kansas City Field Office. “This case highlights that even when complex criminal networks engage in such illegal activities on a global scale from a foreign-based location, without regard for risk to human life, they are still held accountable for their actions in the United States. We commend the United States Attorney’s Office in Colorado and our law enforcement partners for their tireless efforts in connection with the investigation and subsequent prosecution of this case.”

“Combating the shipment of counterfeit pharmaceuticals through the U.S. Mail continues to be a priority for the United States Postal Inspection Service,” said Acting Denver U.S. Postal Inspector in Charge Andrew Balkin. “When the mails are used to ship counterfeit pharmaceuticals it is a violation of Federal Law, and United States Postal Inspectors take this offense seriously. Investigation of this crime displays another successful effort to dismantle criminal enterprises involved in this type of activity.”

Zhou was prosecuted by Assistant U.S. Attorney Kenneth M. Harmon, with assistance from Assistant U.S. Attorney Ryan Bergsieker, District of Colorado.


June 7th, 2011

ICE Puts The Summer Heat On Counterfeiters Through “Operation In Our Sites”

Story courtesy of U.S. Immigration and Customs Enforcement (ICE) and the IACC (International Anti-Counterfeiting Coalition).

ice logo

WASHINGTON. As the summer months begin in the United States, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) is keeping the heat on counterfeiters by seizing domain names of websites used to sell counterfeit goods and illegally distribute copyrighted materials. This operation marks the fifth phase of “Operation In Our Sites,” a sustained law enforcement initiative aimed at counterfeiting and piracy over the Internet.

The websites seized during this phase of “Operation In Our Sites” include:

Mygolfaccessory.com

Freshkicks4u.com

Freshcaps4u.com

Watchnewfilms.com

Re1ease.net

During the course of the operation, ICE HSI agents investigated websites suspected of selling counterfeit goods and illegally distributing copyrighted material in the United States. Once the materials were confirmed as counterfeit or otherwise illegal, seizure orders for the domain names of the websites that sold or distributed the items were obtained from federal magistrate judges. Individuals accessing the websites will now find a banner notifying them that the domain name of that website has been seized by federal authorities.

“American business is threatened by those who produce counterfeit trademarked goods and pirate copyrighted materials,” said ICE Director John Morton. “From counterfeit pharmaceuticals and electronics to pirated movies, music, and software, IP thieves undermine the U.S. economy and jeopardize public safety. That is why the Operation In Our Sites initiative will continue through 2011 and beyond. Our efforts through this operation successfully disrupt the ability of criminals to purvey counterfeit goods and copyrighted materials illegally over the Internet.”

This nationwide operation was spearheaded by the ICE HSI-led National Intellectual Property Rights Coordination Center (IPR Center) in coordination with U.S. Attorneys’ Offices for the Northern District of California, Southern District of Texas, and Western District of Washington and HSI offices in Houston, San Francisco and Seattle.

In June 2010, ICE HSI and the IPR Center began “Operation In Our Sites.” Since the launch of this operation, ICE HSI and the IPR Center have seized a total of 125 domain names and redirected those domain names to a seizure banner. Seventy-six of the 125 domain names seized have now been forfeited to the United States government. Through the forfeiture process, individuals who have an interest in the seized domain names are provided a period of time after the “Notice of Seizure” to file a petition with a federal court and additional time after the “Notice of Forfeiture” to contest the forfeiture. If no petitions or claims are filed, the domain names become property of the U.S. government.

Last month, the IPR Center launched a public service announcement (PSA) that appears on each of the 76 forfeited domain names. Since the launch of this PSA on ICE’s YouTube page, this video has received nearly 100,000 individual views, educating the public about the economic impact of trademark counterfeiting and copyright infringement. The PSA on forfeited websites is a significant benefit of this enforcement operation in deterring future crimes and in raising awareness.

In December 2010, the New York City Mayor’s Office of Media and Entertainment launched the PSA campaign entitled “Piracy Doesn’t Work in NYC,” which targets digital piracy. The goal of the campaign is to reinforce to the public that the jobs of New Yorkers who work in and support the creative industries in the city are threatened when digital entertainment such as books, movies and songs are illegally downloaded.

“A significant amount of the creative entertainment that gets produced each year is made in New York City whether it’s books, music, films or television shows,” said Katherine Oliver, commissioner of New York City Mayor’s Office of Media and Entertainment. “The City is home to nearly 700,000 New Yorkers who make their living either working in or supporting those creative industries so when people illegally download their entertainment, lost revenue from those actions could mean lost jobs in the City.”

Intellectual property rights violators unfairly devalue America’s contributions, compromise American jobs, and put consumers, families, and communities at risk. They also protect the actor, director, writer, musician, artist, and countless others who labor in and around America’s entertainment industry from having a movie, manuscript, song or design illegally sold by someone who had no part in the artistry of creating it. Intellectual property rights are intended to discourage thieves from selling cheap imitations of products that are often far less safe or reliable than the original products. More importantly, intellectual property rights protect public safety by preventing the proliferation of counterfeit pharmaceuticals and other materials that are potentially harmful.

It is estimated that intellectual property thefts costs American industry billions of dollars and hundreds of thousands of jobs every year. Additionally, “Operation In Our Sites” is also targeting counterfeit pharmaceuticals, software, electronics, games and other products that threaten public health and safety.

The IPR Center is one of the U.S. government’s key weapons in the fight against criminal counterfeiting and piracy. The IPR Center is led by ICE HSI and includes partners from U.S. Customs and Border Protection; FBI; Food and Drug Administration, Office of Criminal Investigations; Postal Inspection Service; Department of Commerce, International Trade Administration; Patent and Trademark Office; Naval Criminal Investigative Service; Defense Criminal Investigative Service; Army Criminal Investigative Command, Major Procurement Fraud Unit; General Services Administration, Office of Inspector General; Consumer Product Safety Commission; Defense Logistics Agency, Office of the Inspector General; Air Force Office of Special Investigations; Department of State, Office of International Intellectual Property Enforcement; INTERPOL; Government of Mexico, Tax Administration Service; and Royal Canadian Mounted Police.

As a task force, the IPR Center uses the expertise of its member agencies to share information, develop initiatives, coordinate enforcement actions, and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public’s health and safety, the U.S. economy and the war fighters.

To report IP theft, visit www.IPRCenter.gov.


May 26th, 2011

Combating Intellectual Property Theft

A Law Enforcement Priority

Story courtesy of John Morton, Director, U.S. Immigration and Customs Enforcement (ICE)

z joe morton 1

Photo above: John Morton at a February press conference.

Intellectual property protection drives research and development in the private sector. These days, however, the R&D calculus can look like a losing proposition as large-scale counterfeiting and online digital theft badly undermine traditional market forces. Consider that a pharmaceutical company may spend over one billion dollars to develop the next “miracle drug,” only to see counterfeits of the medication appear on the market the year after its release. Similarly a film studio may invest hundreds of millions of dollars in a single film only to find free copies of the movie on the internet, even prior to official release in some british english theatres. Fashion houses and luxury brand manufacturers can easily find exact replicas of their products at a boot sale market or on the internet.

It is beyond dispute that global intellectual property theft results in billions in lost revenue, taxes, and employee benefits. Innovation, consumer safety, and economic growth are sacrificed in the name of criminal profit. And yet debate still rages as to whether law enforcement should take action against counterfeiting and online theft. As the head of ICE, I direct the U.S. law enforcement agency that investigates much of the intellectual property theft occurring in or through the United States. As a byproduct, I am criticized by some for the aggressive strategy my agency has undertaken to protect intellectual property rights because it is thought to be a matter reserved for business, not government. While neither I, nor the agents within our agency, will waver one bit from our mission, it is appropriate to address the arguments of our opponents.

Photo below: counterfeit goods.

z joe morton 2

A recent study published in the British Journal of Criminology suggests that counterfeiting of luxury fashion goods is a relatively minor concern and that law enforcement agencies should refrain from pursuing these cases. While the authors of the study seem well intentioned, their conclusion leads to the wrong answer. By focusing on counterfeiting of “luxury fashion goods,” the authors understate the scope of the problem and ignore the proven links between counterfeiting and organised crime. In addition, creating a dichotomy between types of counterfeit goods — those “worthy” of government protection and those that are not — creates an inappropriate role for government to deem certain companies or business less important.

Finally, it ignores the reality that, as a whole, aggressive enforcement against counterfeiting and online digital theft is the “rising tide that lifts all boats.” Simply put, the counterfeiting of all trademarked and copyrighted goods amounts to a significant form of theft. This crime goes far beyond luxury goods and high-end apparel to encompass software, electronic components, DVDs, pharmaceuticals, automotive parts and much more. As trafficking in these goods has grown, it has created an opportunity for criminal organisations to enter the field. And the criminal organisations have readily seized that opportunity.

Photo below: counterfeit drugs.

z joe morton 3

The link between intellectual property theft and organised criminal activity is well established. A 2009 study by the RAND Corporation showed how the same criminal groups that engage in intellectual property theft are involved in other serious crimes, such as extortion, drug trafficking, human smuggling and trafficking, and violent crime. Our law enforcement investigations have borne out the same conclusion. Moreover, attempting to separate “luxury fashion goods” from the larger realm of counterfeit goods sets up a false distinction. It is unlikely that criminal and terrorist organisations will pick and choose the types of counterfeit items in which they traffic. Instead, they will traffic in those goods that provide the greatest profits at the lowest risk-whatever makes it easiest for them to make a profit and fund further criminal activities. In our law enforcement efforts, we have come across counterfeit air bags to be installed in cars, toothpaste filled with chemicals found in anti-freeze, and even fake parts for radios intended to allow the military to communicate secretly on the battlefield. Worse, as criminal organisations realize the profits to be made, they don’t pay taxes that would otherwise be paid on legitimate goods; they don’t fund workers’ pensions, or invest in the next “miracle drug.” Criminals merely wait for their next parasitic venture: illegally copying and producing someone else’s innovative idea.

Multilateral and Multiagency Enforcement

Fortunately, law enforcement around the world is developing a clearer sense of the dangers posed by intellectual property theft. Some of our most successful intellectual property cases have been multilateral investigations conducted across international boundaries, in a true spirit of partnership. Like BritishAmerican Business, we have learned that transatlantic partnerships reap significant, mutually beneficial rewards. For example, in March 2010, nine individuals were indicted in a conspiracy to smuggle into the U.S. counterfeit shoes, handbags and watches manufactured in Malaysia and China.

The indictment resulted from an investigation between U.S. Immigration and Customs Enforcement (ICE), the City of London Police and the United Kingdom Border Agency. During the investigation, the defendants arranged with undercover agents to smuggle shipments of counterfeit products into the U.S. The defendants also paid the undercover agents to ship three containers of counterfeit goods to the UK. In addition to the smuggling fee, the indictment alleges that the co-conspirators often paid an additional amount of money which was to be “laundered” through the undercover agents. As part of the investigation, the London police arrested seven suspects and seized 50,000 items of counterfeit clothing, believed to be the largest ever counterfeiting case in U.K. history.

In the U.S. we realise that no one law enforcement agency can tackle this problem alone. That’s why the National Intellectual Property Rights Coordination Center, commonly known as the IPR Center, is leading the effort to make aggressive, effective IP theft enforcement a reality. The IPR Center, led by ICE’s Homeland Security Investigations (HSI), brings together 14 U.S. agencies, along with INTERPOL and the governments of Mexico and Canada to tackle all forms of IP theft. The IPR Center’s mission is to be “one stop shopping” for rights holders who are victims of IP theft by making available the resources of multiple agencies under one roof.

21st Century Enforcement

We are also attacking IP theft operating in cyber space. The internet is one of the great advances of our time and will shape our lives and those of our children without any doubt. But cyber IP thieves are increasingly using the web to market and sell counterfeit and pirated goods everything from knockoff luxury goods to pirated movies, to fake pharmaceuticals. These investigations present unique challenges. The thieves are often overseas, sometimes in countries without robust anti-counterfeiting regimes. And the increasing use of multiple servers complicates the collection of electronic evidence, requiring countless hours of computer forensics work. In June 2010, the IPR Center, ICE’s HSI and U.S. prosecutors announced the most aggressive enforcement action against online counterfeiting and digital theft ever conducted through Operation “In Our Sites.”

In the course of this operation, we have seized domain names of websites illegally offering copyrighted films and television programs as well as selling counterfeit electronics, luxury goods, software, games and items that pose a threat to health and safety. Using judicially-ordered seizure warrants and posting an electronic seizure banner on offending websites, we have observed an unprecedented level of public interest and awareness. How do we know this? One measure is that the seizure banner has received over 36 million hits as a result of these four successive rounds of seizures over eight months. Combined with the fact that over 80 illegal websites have voluntarily been taken down by their operators, it is clear we are making an impact through Operation In Our Sites.

Our intellectual property enforcement on the internet has been alternately praised by victim rights holders, criticised by some, and watched with curiosity by many. However, I remain firmly convinced that government exists, in great part, to protect private property from theft. Intellectual property defines private property in industry. Law enforcement needs to combat intellectual property theft at all levels Crime is crime and given the stakes, law enforcement should not turn a blind eye to this pernicious form of theft. One reason for the success of enforcement actions like Operation In Our Sites is the IPR Center’s efforts to foster partnerships with the private sector. We recognise that law enforcement cannot fight IP theft alone.

To facilitate productive partnerships, the IPR Center launched Operation Joint Venture, which supplies both industry and law enforcement with valuable information about our efforts to combat the importation of hazardous and counterfeit products, and provides you with a point of contact in the field that you can use to provide us with leads and tips. If you know about efforts to compromise your company’s intellectual property rights, let us know. Often our best cases often start with leads industry provides. Through our combined efforts, by collaborating and sharing information, we can have a resounding impact on IP theft.

John Morton is director of U.S. Immigration and Customs Enforcement (ICE), the largest investigative agency in the Department of Homeland Security. ICE leads the National Intellectual Property Rights Coordination Center (IPR Center), a multi-agency task force in Arlington, Virginia, dedicated to combating intellectual property theft.


May 24th, 2011

ICE Probe Targets Major Los Angeles Chinese Video Store

Story courtesy of the IACC (International Anti-Counterfeiting Coalition).

Two arrested in ICE probe targeting major LA-area Chinese video store. Tens of thousands of movie DVDs bearing counterfeit Dolby Digital trademark seized.

LOS ANGELES. The owner and manager of a popular Monterey Park, Calif., video store were arrested Monday morning by agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) on allegations they illegally imported and sold tens of thousands of Chinese movie DVDs bearing a counterfeit Dolby Digital trademark.

Wei Sheng “Jackie” Chen, 46, of Arcadia, Calif., owner of Tema Media, Inc., and the store’s manager, Dong Qun Lin, 40, of Alhambra, Calif., are charged in a federal criminal complaint with trafficking in counterfeit goods. They are expected to make their initial appearance in federal court here Monday afternoon. The charges carry a maximum possible sentence of up to 10 years in prison. The case is being prosecuted by the U.S. Attorney’s Office for the Central District of California.

Monday’s arrests are the latest developments in an ongoing ICE HSI investigation that began in Sept. 2010 after U.S. Customs and Border Protection (CBP) officers intercepted an air freight shipment containing more than 1,700 DVDs from Hong Kong addressed to Tema Media. CBP import specialists determined the Dolby trademark stamps on those movie DVDs were counterfeit.

“This seizure is a prime example of the hard work CBP officers and import specialists perform daily in combating the illegitimate trade in counterfeit goods at Los Angeles International Airport,” said CBP Acting Director of Los Angeles Field Operations Carlos Martel. “CBP remains committed to working with our federal, state and local law enforcement partners to protect American consumers against products that hurt American businesses.”

In January, HSI agents executed a federal search warrant at Tema Media, located at 151 E. Garvey Ave., where they seized nearly 25,000 Chinese DVDs bearing counterfeit Dolby Digital trademarks. Had the seized DVDs been genuine they would have had an estimated retail value of more than $1 million. Subsequent investigation revealed that Tema Media had imported approximately 85 shipments of Chinese DVDs in a five-month period from March through Oct. 2010.

“Our investigation indicates this retailer supplied clients not only in California, but also in Nevada,” said Claude Arnold, special agent in charge for ICE HSI in Los Angeles. “American consumers need to remember, the sale of counterfeit products like this is not a victimless crime. Counterfeiters don’t invest in product development; they don’t put a premium on product quality or safety; all they do is get rich at America’s expense.”

As the largest investigative arm of the Department of Homeland Security, ICE’s HSI plays a leading role in targeting individuals and criminal organizations responsible for producing, smuggling, and distributing counterfeit products. In fiscal year 2010, ICE and CBP intellectual property rights enforcement efforts led to nearly 20,000 seizures, a 34 percent increase compared to the previous year. The total value of those goods, based upon the manufacturer’s suggested retail price had the goods been genuine, $1.4 billion. Perhaps even more troubling, increasingly the commodities seized in intellectual property rights cases are products that pose potential risks to public safety and security, including critical technology components and counterfeit pharmaceuticals.


May 19th, 2011

A Cup Of Tea For Daddy.

daddys little girl

One day a little girl’s mother was out, and dad was in charge of his daughter. She was maybe 2 1/2 years old. Someone had given her a little ‘tea set’ as a gift, and it was one of her favorite toys.

Dad was in the living room engrossed in the evening news when his little girl brought him a tiny cup of ‘tea’, which was just water. After several cups of tea and lots of praise for such yummy tea, mom came home.

Dad made her (the mom) wait in the living room to watch his little girl bring him a cup of tea, because it was ‘just the cutest thing!’ Mom waited, and sure enough, the sweet little girl came down the hall with a cup of tea for Daddy; and she watched him drink it up.

Then mom said, (as only a mother would know),”Did it ever occur to you that the only place she can reach to get water, is the toilet?”


May 13th, 2011

Bill Would Bag Phony-Purse Buyers.

Story courtesy of John Doyle from “The New York Post” and the IACC (International Anti-Counterfeiting Coalition).

Pretty soon, it could be more than just the fashion police who have a problem with your shoddy knockoff bag, like a bogus Louis Vuitton.

Buyers could face a year in jail or a $,1000 fine under a proposed bill by a city councilwoman fed up with cheapskate tourists and Big Apple residents flooding her district in search of fake designer merchandise.

“We don’t want to be known as the place to come to get counterfeit goods,” said Councilwoman Margaret Chin, whose Chinatown district is ground zero for counterfeiters.

Under Chin’s bill, which is being introduced Thursday, shoppers caught buying any counterfeit product could be jailed or slapped with a fine of $1,000 — a little less than the price of Marc Jacobs’ frequently copied Baroque Quilting Mini Stam bag, which retails for $1,250.

“It’s a very big problem,” Chin said of the counterfeit market. “People are still coming, and the industry is growing, and we have to stop the demand. We need people to know that they are feeding this demand.”

Several of Chin’s colleagues have expressed support for the bill, and she already has five co-sponsors.

The punishment might seem draconian, but it’s necessary to curb the growing problem, she said.

She pointed out that the money that counterfeiters rake in often funds other nefarious activities, such as terrorism and unsafe child-labor practices.

But try telling that to bargain hunters. Christine Gambino, 21, of Staten Island — who was in Chinatown yesterday sporting a fake Louis Vuitton handbag that cost her $40 — vowed to continue to hit the neighborhood for counterfeit goodies. “I’ll take a risk and sacrifice to look good and pay less,” she said.

Erma Charles of Brooklyn said she knows it’s wrong, but she can’t resist. “Everyone steals,” the teacher said as she walked in Chinatown.

If the law passes, Chin said, she’ll work to blanket problem areas like Chinatown with signs warning people about the new rules. The law specifically states that buyers should know their goods are counterfeit because of the low price and location where they are buying them.

But don’t worry if you’re strolling down the street swinging your fake Vuitton and the police pass by. You have to be caught actually buying the goods to be charged, according to the proposal. Surprisingly, legit merchants — who could lose street traffic if the ubiquitous black-market vendors were to leave — applauded the proposal.

Sandy Lui, manager of Optical 88 on Hester Street, acknowledged that she might lose customers, since many people come to Chinatown specifically to buy knockoffs, but she said she supports a crackdown on principle. “It’s wrong to sell [fake goods]. I don’t like people coming in here assuming we also sell fake stuff,” she said.

Cops — who have struggled to stop the growing problem — said the law would be difficult to enforce. “It’s never going to fly,” one officer said.

Additional reporting by Rebecca Rosenberg and Jennifer Fermino.


April 26th, 2011

Keeping Counterfeits Out Of Google Ads.

Story courtesy of Kent Walker, Senior Vice President and General Counsel, Google, and the IACC (International Anti-Counterfeiting Coalition).

Thanks to the Internet, it’s never been easier to start a business and reach a huge audience, at an incredible scale. Unfortunately, some people misuse legitimate online services to try to market counterfeit goods. Of course, this isn’t a problem unique to the online world, but as the Web has grown, so have attempts to sell counterfeits online.

With over one million advertisers using AdWords in over 190 countries, how do we weed out the bad actors who violate our clear policies against advertising counterfeits? In the last six months of 2010 alone, we shut down approximately 50,000 AdWords accounts for attempting to advertise counterfeit goods. But there’s no silver bullet here. Instead, it’s a cat-and-mouse game, where we are constantly working to improve our practices and tune our systems to keep out the bad guys.

That’s why today we’re announcing three improvements designed to further improve our collaboration with brand owners to address the problem and prevent counterfeiters from abusing our services:

* We’ll act on reliable AdWords counterfeit complaints within 24 hours. In 2009, we announced a new complaint form to make it fast and easy for brand owners to notify us of misuse. For brand owners who use this form responsibly, we’ll reduce our average response time to 24 hours or less.

* We will improve our AdSense anti-counterfeit reviews. We have always prohibited our AdSense partners from placing Google ads on sites that include or link to sales of counterfeit goods. We will work more closely with brand owners to identify infringers and, when appropriate, expel them from the AdSense programme.

* We’ve introduced a new help center page for reporting counterfeits. That way, we aim to make it easier for users and brand owners to find forms to report abuse.

These steps are our ways of facilitating co-operation with brand owners, which is absolutely essential in tackling the sale of counterfeits online. AdWords is just a conduit between advertisers and consumers and we can’t know whether any particular item out of the millions advertised is counterfeit or not.

Of course, we do more than simply respond to brand owners’ removal requests. We use their feedback to help us tune a set of sophisticated automated tools, which analyze thousands of signals along every step of the advertising process and help prevent bad ads from ever seeing the light of day. We devote significant engineering and machine resources in order to prevent violations of ads policies, including counterfeiting.

In fact, we invested over $60 million last year alone, and, in the last 6 months of 2010, more than 95% of accounts removed for counterfeits came down based on our own detection efforts. No system is perfect, but brand owner feedback has helped us improve over time as our system gets more data about ads it has misclassified before, it gets better at counteracting new ways that bad guys try to cloak their behavior.

While our systems get better over time, counterfeiting remains a complex challenge, and we keep investing in anti-counterfeiting measures. After all, a Google user duped by a fake is far less likely to click on another Google ad in the future. Ads for counterfeits aren’t just bad for the real brand holder they’re bad for users who can end up unknowingly buying sub-standard products, and they’re bad for Google too.


March 22nd, 2011

New York Sting Operation Charges Texas Man With Illegal Internet Operations.

This story courtesy of IACC (International Anti-Counterfeiting Coalition).

MANHATTAN U.S. ATTORNEY CHARGES TEXAS MAN WITH ILLEGALLY STREAMING LIVE SPORTING EVENTS AND OTHER TELEVISION PROGRAMMING OVER THE INTERNET

PREET BHARARA, the United States Attorney for the Southern District of New York, and JAMES T. HAYES, JR., the Special Agent-in-Charge of the New York Office of Homeland Security Investigations (“HSI”), announced the arrest today of BRIAN McCARTHY for criminal copyright infringement.

McCARTHY illegally streamed live, copyrighted sporting event telecasts, Pay-Per-View events, and other television programming through Channelsurfing.net, a website he operated.

Through advertising revenue he obtained for the website, McCARTHY made well over $90,000, in proceeds from the crime.

The arrest follows the February 1, 2011, seizure of that website’s domain name, pursuant to a seizure warrant issued by U.S. Magistrate Judge FRANK MAAS in the Southern District of New York.

Manhattan U.S. Attorney PREET BHARARA said: “Brian McCarthy allegedly hid behind the anonymity of the Internet to make a quick buck through what is little more than high-tech thievery. This arrest should make clear that this Office, working with its partners at ICE-HSI, will vigorously protect valuable intellectual property rights not only through domain name seizures, but also where appropriate through arrests.”

HSI Special Agent-in-Charge JAMES T. HAYES said: “Today’s arrest is another step forward in the ongoing investigation by New York HSI Agents into copyright infringement and theft of intellectual property rights. We will continue to investigate illegal streaming of programming on the Internet in an effort to preserve legitimate and creative business interests and deter others from engaging in on-line piracy.”

According to the Complaint unsealed today in Manhattan Federal Court, and the Seizure Affidavit through which the “Channelsurfing.net” domain name was seized:

Until it was seized by law enforcement on February 1, 2011, Channelsurfing.net provided access to illegal, pirated telecasts of sporting events of the National Football League (“NFL”), the National Basketball Association (“NBA”), the National Hockey League (“NHL”), World Wrestling Entertainment (“WWE”), and the Ultimate Fighting Championship (“UFC”) – all of which hold the copyrights to the televised broadcasts of their respective sporting events. Channelsurfing.net was a linking site, and visitors to the website would simply click on one of a number of links to begin the process of downloading or streaming to their own computer an illegal broadcast of pirated sporting and Pay-Per-View events. In connection with the investigation, law enforcement downloaded portions of live copyrighted telecasts of various sporting events. The website also contained links to various live television channels.

BRIAN McCARTHY, who registered the Channelsurfing.net domain name in December 2005, operated the website until the time of its seizure out of his home in Texas. In so doing, he received profits in excess of $90,000, from online merchants who paid him, through Internet advertising brokers to advertise on that site. At the time it was seized, Channelsurfing.net was one of the most popular of the websites that streamed illegal content.

McCARTHY, 32, of Deer Park, Texas, is charged with one count of criminal infringement of a copyright. If convicted, he aces a maximum of five years in prison. Mr. BHARARA praised the work of ICE-HSI. He added that the investigation is continuing. This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney CHRISTOPHER D. FREY is in charge of this prosecution.

The charge contained in the Complaint is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.


March 4th, 2011

California Man Charged By Grand Jury For Trafficking In Counterfeit Goods.

Press release from Homeland Security Investigation.

BAKERSFIELD, Calif. – A federal grand jury indicted a Bakersfield businessman on one count of trafficking in counterfeit goods.

Eric Huggins, 51, owner of a shop called Girlfriends by Design, was arrested by agents with Immigration and Customs Enforcement’s Homeland Security Investigations. Huggins allegedly sold counterfeit clothing and accessories bearing labels of well-known designer brands, such as Chanel, Coach and Prada. He also allegedly sold fakes bearing sports logos from the NBA and NFL.

Huggins has since been released on numerous pretrial conditions, and his next court appearance in March before a federal magistrate judge in Fresno.

The investigation began when an ICE HSI agent posing as a customer bought several counterfeit items in December 2009 from Girlfriends by Design on Ming Avenue. A few months later, agents served search warrants at Huggins’ stores on Ming and 19th Street, as well as Huggins’ home. ICE said it seized more than $140,000 worth of counterfeit items.

“Vendors who sell counterfeit products are stealing – they’re robbing from law-abiding merchants, from the legitimate companies that make these products, and from the men and women who depend on those legitimate companies for their livelihood,” Michael Toms, resident agent in charge for ICE HSI in Bakersfield, said in a news release form the U.S. Attorney’s office. “Trafficking in counterfeit goods is a serious crime, which is why ICE HSI will continue to target retailers and websites that engage in this type of activity.”

Huggins admitted that he once sold counterfeit purses at Girlfriends by Design on Ming Avenue and on the streets out of his vehicle. He denied selling widespread counterfeit merchandise, as claimed by federal investigators.

“I knew the purses were fake,” Huggins told reporter Jose Gaspar at the time. Huggins went on to say, “Bakersfield is big for buying (fakes). If they weren’t’ so big on buying ‘em, we wouldn’t be so big on wanting to sell them.”

The charge of trafficking in counterfeit goods carries a maximum penalty of up to 10 years in prison and fine of up to $2 million.


February 25th, 2011

“Steel The One”

Congratulations to the Green Bay Packers.

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01 packers super

Three photos above courtesy of “The Milwaukee Journal-Sentinel”.

Photo below. Maya, daughter of of ATL employees Polo and Hilda, is a Clay Matthews fan.

z maya packer


February 20th, 2011

China Continues To Produce Counterfeit Goods.

Story courtesy of The New York Post, CHARLES HURT in Washington, DC, and BILL SANDERSON in NY, and IACC (International Anti-Counterfeiting Coalition).

While we were toasting China’s President Hu Jintao at the White House yesterday with steak and Cabernet, his nation’s factories continued to pump out billions of dollars worth of counterfeit goods that were being sold right on the street in lower Manhattan and across the nation on the Internet.

On Canal Street, a vendor with a table full of knock-off designer handbags brazenly peddled a supposed Coach handbag to a Post reporter for $50 — far from the price of the real bag, the US-based firm’s Madison line, which sells for $698 in stores.

US Customs officials have determined that 90 percent of these fake goods, from pharmaceuticals to knock-off handbags, originate in China’s factories — robbing US firms of profits and workers of jobs.

“China is the source of a great deal of trademark counterfeiting, including fake drugs, knock-off handbags, and phony everyday consumer products. These products are often of low quality or dangerous to health and safety,” said Steve Tepp at the US Chamber of Commerce’s Global Intellectual Property Center.

Tepp said China’s counterfeiters have found even greater profits peddling their wares on the Internet, which he estimated generates $135 billion in annual sales. “The losses from all this criminal activity steals jobs from the US businesses that lose out on legitimate sales,” Tepp said.

Small businesses, like David Pearl’s Uniweld, are fighting an uphill battle against the counterfeiters. The Fort Lauderdale, Fla.-based manufacturer of high-precision pressure gauges used by mechanics and refrigeration repairers said he loses about $1 million a year to the pirates. “We are getting hammered,” said Pearl, who employs about 250 people in his US factory. “They fully counterfeited everything, down to our box with our name on it. They have no scruples whatsoever.”

But intellectual property rights got short thrift at Hu’s official state visit with President Obama yesterday, with security and currency issues getting top priority. Indeed, the only real concession Obama wrangled from Hu was a promise that Chinese state agencies would audit their software libraries in a bid to purge their own pirate files.

“As we look to the future, what’s needed, I believe, is a spirit of cooperation that is also friendly competition,” Obama said during a rare press conference in which Hu answered questions.

Hu, according to Obama, showed a “willingness to take new steps to combat the theft of intellectual property.” Skeptics, however, doubted that this new willingness would do much to stem the flow of fake bags or the blatant copying of American innovations in high-tech and manufacturing.

“This is ingrained in Chinese business culture. They don’t respect intellectual property,” said Eric Corl, who runs an online intellectual-property marketplace called Idea Buyer. “The problem comes when these products make their way into the US supply chain.”

The state dinner — much anticipated by Hu, who was offended that he received only a luncheon while visiting former President George W. Bush in 2006 — was a celebrity-studded event befitting the head of the world’s fastest-growing economic power. Dignitaries and celebrities, including Jackie Chan, Barbra Streisand, designer Vera Wang, and former Presidents Bill Clinton and Jimmy Carter, dined on pear salad with goat cheese, lobster, rib-eye steak with double-stuffed potatoes, creamed spinach, and apple pie with vanilla ice cream.

Before the dinner, Obama did win agreements to help US companies trying to crack into the Chinese market. China agreed to scrap its government’s “indigenous innovation” policy of only purchasing Chinese-made goods and agreed to an export deal worth $45 billion, including $19 billion for the purchase of 200 airliners from Boeing.

At a joint press conference with Obama, Hu applauded the “positive, cooperative and comprehensive” relationship between the two countries and said he and Obama agreed “to strengthen exchanges and cooperation in economy and trade, energy and the environment.”

“We champion free trade and oppose protectionism,” Hu said.

On another thorny issue, Hu made a rare admission on human rights. During the press conference, he said China had made enormous progress but surprisingly conceded that “a lot still needs to be done in China in terms of human rights.”

On currency issues, Hu said only that China would slowly adjust the value of its currency, but many say its pace is too slow as it continued to give its exporters — both legitimate and illegitimate — a competitive edge.

“I absolutely believe China’s peaceful rise is good for the world, and it’s good for America,” Obama said, addressing a major concern in Beijing that the United States wants to see China’s growth constrained.


February 4th, 2011

Feds Seize Sports Websites Before Super Bowl.

Story courtesy of Politico, Jennifer Martinez, and IACC (International Anti-Counterfeiting Coalition).

01 Clay Matthews

The federal government has seized the Web addresses of 10 websites that allegedly live stream sporting and pay-per-view events online, shutting them down just days before one of the biggest televised sporting events of the year: the Super Bowl. The U. S. Attorney’s Office of the Southern District of New York, working in conjunction with Immigration and Customs Enforcement, seized the Web addresses Tuesday. The seizure affidavit was unsealed Wednesday.

The websites, which include channelsurfing.net and Spain-based rojadirecta.org, were said to illegally provide access to content from the major professional sports organizations, namely the National Football League, National Basketball Association and the National Hockey League. The sites do not host the pirated sporting content themselves, but instead provide links to other websites where people can access it illegally.

Government officials argue that the sites are not only distributing pirated content illegally, but in the process, are also denting the revenues of the professional sports leagues and broadcasters as well as negatively impacting viewers.

“The illegal streaming of professional sporting events over the Internet deals a financial body blow to the leagues and broadcasters, who are forced to pass their losses off to fans by raising prices for tickets and pay-per-view events,” said Preet Bharara, U.S. Attorney in Manhattan. “With the Super Bowl just days away, the seizures of these infringing websites reaffirm our commitment to working with our law enforcement partners to protect copyrighted material and put the people who steal it out of business.”

Fans have increasingly abandoned watching sports games on their television sets, opting instead to watch them on their computers via the Web instead. The shift has jolted professional sports organizations, which are grappling with how to control the growing problem of the illegal streaming of sports games online in real time. The organizations copyright the content of their sports games – from the audio, video, text and images – and restrict others from distributing it without prior written approval. But the government’s action didn’t provide a permanent solution to the problem. One of the sites that was shut down on Wednesday, ATDHE.net, has already reappeared at a new Web address, ATDHE.me.

The federal government launched a similar campaign last November that shut down 82 websites offering counterfeit goods and digital music and movie content. U.S. Attorney General Eric Holder and ICE Director John Morton had warned that the two agencies were committed to going after more websites that offer copyrighted content illegally. Morton repeated that message during Wednesday’s operation.

“This swift action by our Homeland Security Investigations New York special agents and analysts sends a clear message to website operators who mistakenly believe it’s worth the risk to take copyrighted programming and portray it as their own,” Morton said. “We will continue to aggressively investigate this type of crime with our law enforcement partners.”


February 3rd, 2011

Packers & Bears. Gotta Love It!

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And….Not all headlines are true.

z BearsTruman


January 20th, 2011

Authorities Crack Down On Flea Market Fakes.

Story Courtesy of BETH DeFALCO, Associated Press, and IACC (International Anti-Counterfeiting Coalition).

TRENTON, N.J. Used to be, if you wanted a knockoff handbag or fake fragrance, Lower Manhattan’s Canal Street was a mecca.

Photo below: In this Dec. 9, 2010 photograph, New Jersey State Police Lt. Michael E. McDonnell stands near boxes of fake name-brand clothing. in Columbus, N.J., that police seized from a vendor at the Columbus Flea Market. (AP Photo/Mel Evans)

Flea Market Fakes

With flea markets across the country now carrying the same kind of counterfeit products with poser trademarks, authorities warn that shoppers may get more than they bargain for in poor quality and safety risks while helping fund criminal syndicates in some cases.

“If the price is too good, you have to think about it,” said Lt. Mike McDonnell with the New Jersey State Police cargo theft unit. “If you see it at a flea market and it’s half the price of normal, you have to think there’s something wrong.”

The unit seized more than 5,000 pieces of counterfeit product at a flea market in Springfield, N.J., this month, including fake Estee Lauder and MAC cosmetics that retail for more than $300,000.

Four vendors were arrested on charges of possessing counterfeit trademark items, an offense that can carry jail time if more than 1,000 items are confiscated.

The safety risks of buying fake goods are real, experts say. Counterfeit goods, or knockoffs, are different from the cheaper imitation versions found at major retailers, like Wal-Mart or Target, in that those retailers sell items that follow Consumer Safety Product Commission guidelines. Fakes usually are smuggled into the country unregulated; nearly 80 percent come from China, according to U.S. customs officials.

Safety risks include fake batteries that contain mercury, electrical products that don’t meet safety standards, perfumes found to contain urine and high alcohol content, and clothing made with toxic dyes and flammable materials.

While cosmetics are generally not subject to pre-market approval, the U.S. Food and Drug Administration restricts the use of certain ingredients and requires warning labels. Legitimate manufactures can be fined or face other enforcement action if they don’t comply. And if the potential health risks don’t scare buyers, the economic risks and potential terror funding should, said Robert Barchiesi, president of the International AntiCounterfeiting Coalition. “You support organized crime, gang activity, and terrorist organizations that use this as a funding mechanism,” he said.

Barchiesi estimates the U.S. economy loses out on at least $200 billion in revenue and 750,000 jobs a year from counterfeit sales. “This isn’t a victimless crime,” Barchiesi added.

The sentiment is echoed by local and federal law enforcement, who have been stepping up enforcement of flea markets and other counterfeit clearing houses. This month alone, customs agents seized $250,000 worth of items at a swap-meet in New Orleans, $350,000 worth of goods at a flea market in Las Vegas, and $150,000 worth of merchandise at one in Solebury, Pa., that included fake trademarks for Nike, Polo Ralph Lauren, Oakley, Ray-Ban, Coach, Louis Vuitton, Chanel, Gucci, Dolce & Gabbana, and UGG boots. “We’re looking where that money is going and what crimes it could be funding,” said Pat Reilly with the U.S. Immigration and Customs Enforcement agency in Washington, D.C., a division of the Department of Homeland Security.

ICE cites cases in Philadelphia and Miami in which counterfeit traffickers were linked to terrorist groups, including supporters of Hezbollah, the Lebanese militant group. “We have traced some of the money out to countries where the link to terrorism is tangental, if not solid. It’s a global problem,” Reilly said.

The National Flea Market Association did not return an e-mail seeking comment.

At Rice’s Market in Solebury counterfeit UGG boots sold Dec. 12 for $50 while the authentic sheepskin classics retail elsewhere for as much as $180. Federal agents who seized the boots said that the boxes for the counterfeits “made in China,” which should have tipped off consumers that the boots weren’t real.

Manufacturers of the authentic merchandise have an interest in stopping the counterfeit business and often team with police to help tip them off and verify authenticity. “We go to a great extent to produce a quality product that will last a long time for consumers,” said Leah Evert-Burks, director of brand protection at Deckers Outdoor Corp., the high-end Australian shoe company that holds the trademark on UGG boots. “The damage to a brand can be if consumers think it’s genuine and have a bad experience.”

Jill Marvin, a spokeswoman for MAC and Estee Lauder, said consumers can be assured they are getting the genuine product by shopping at a reputable retailer. To help consumers and to protect their brand, companies like Estee Lauder and UGG have also started listing authorized retailers on their websites. But many shoppers still look for a great deal with high-fashion cachet.

Sally Sessoms of Upper Dublin, Pa., didn’t let the recent raid at Rice’s Market get in the way of her annual Christmastime visit there on a recent Saturday morning. Most people know the products are fake, she told The Intelligencer newspaper in Doylestown, Pa. “But who cares?”

Someone given a fake as a gift might care if they unknowingly try to return it to a retailer. Security experts say fakes are easily apparent to retailers.

Kevin Dougherty, who has been investigating counterfeits since 1986 through his Manhattan-based company, Counter Tech, said retailers have sophisticated security measures in place to verify their products. “Fragrance companies can track the fragrance back to the hour and minute it was made and the plant that it was manufactured at,” Dougherty said. And, consumers have a lower-tech way to figure out if a product is real: Common sense. “Generally, your best guide for a counterfeit handbag is a woman,” he said.


January 4th, 2011

Think You Know Milwaukee Trivia? Let’s See If You Know This One.

If you know the answer to this question, give yourself 100 points for being smart.

In the 1970′s and 1980′s, who was the only person ever to play for the Milwaukee Brewers (baseball), and the Milwaukee Bucks (basketball).

The answer: Frank Charles, the very talented organist. He “played” for both teams.

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Photo Above: Frank Charles (left) and Donald Dobert, Milwaukee County Stadium, 1973.

Photo Below: Frank Charles and Doug Czarnecki (ATL Project Engineer, then 9 years old), Milwaukee County Stadium, 1973.

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Today I take time to thank Frank Charles for all of the wonderful memories he provided for baseball, basketball, and hockey fans. Mr. Charles played the organ for many, many years and was very kind to me when I was a young man.

In my everyday business world I use some of Frank’s great examples in my dealings with people, for Frank was always friendly and paid attention to things I was interested in. The small things he always did (for everyone) has been something that I fondly remember, even after nearly forty years.

Frank, thank you for all of the kindness, entertainment, and memories.

Photo Below: Frank Charles at Miller Park for the 2002 (Twenty Year) reunion of the 1982 Milwaukee Brewers team.

Frank Charles in 2002, at the reunion

Photo Below: Frank Charles, forever a Brewers fan, in his Florida home (along with greats Paul Molitor and Robin Yount). He calls this room his “Wisconsin Den”.

Frank Charles in his Floriday den

Photo below:

It was Frank Charles Day at ATL on September 23rd, 2010. Yes, still friends after 37 years. Doug Czarnecki (left), Frank Charles (center), and Donald Dobert (right).

frank charles at ATL 09-23-2010

Photo Below: Frank Charles in year 2010.

Frank Charles in 2010


December 21st, 2010

Counterfeit Shoes & Clothes Lead To Arrest.

New York man, now charged in trafficking, is tied to Charlotte raids.

By Cleve R. Wootson Jr. (This story courtesy of “The Charlotte Observer” and IACC)

A raid on a storage facility and three stores in Charlotte led authorities to a “large-scale trafficker” they say pocketed millions selling counterfeit clothes and shoes across the country.

Ali Nasrallah, 42, has been charged with trafficking and attempting to traffic counterfeit goods. Federal authorities, who arrested Nasrallah after searching his home in New York, say he deposited nearly $7.5 million in banks from the operation.

In a criminal complaint filed Wednesday in Charlotte, agents with U.S. Immigration and Customs Enforcement said he led an organization operating since 1995 that sold clothes and shoes made to look like Nike, Louis Vuitton, Timberland and Polo-brand products to some 70 people who then re-sold the merchandise in Charlotte and nationally.

Authorities said Nasrallah phoned the re-sellers or sent photos when new merchandise was available.

The investigation into Nasrallah began in May 2008, the complaint says, when the Charlotte search turned up 4,100 pairs of fake Nike shoes, which, if sold as authentic, would have brought in more than $600,000.

The person, unnamed in the complaint, who rented the storage facility and owned the stores, was charged with conspiracy to traffic in counterfeit goods, and sentenced to 30 months in prison earlier this year. But the sentence was deferred when the person became a confidential informant, court document says.

The informant told authorities he purchased most of the counterfeit goods in his stores from Nasrallah, the complaint says. Shipping labels with addresses and phone numbers corroborated the informant’s statement, the complaint says, as did surveillance by law enforcement agents.

On Oct. 29, the informant placed an order for $3,000 worth of shoes, which Nasrallah shipped via UPS, according to the complaint. Last month, the complaint says, the informant met with Nasrallah and another person at a Long Island, N.Y., warehouse and placed an order for more counterfeit goods, this time with an estimated value of $69,000.

On Dec. 2, agents moved in, executing search warrants on Nasrallah’s house and the warehouse and seizing products worth more than $1.5 million.


August 26th, 2010

Coach Targets Ocean City Boardwalk Shops For Counterfeit Sales.

Lawsuits allege imitation Coach handbags, wallets and accessories sold at 13 stores.

This story courtesy of Gus G. Sentementes, “The Baltimore Sun”.

Ocean City BoardwalkSign2b

Ocean City’s boardwalk is known for small shops hawking salt water taffy and souvenirs to vacation-goers. But a major luxury brand has accused more than a dozen shops of doing brisk trade in an illegal market: counterfeit handbags and accessories. Over two days in June, an investigator with Coach Inc. entered 13 stores overlooking the beach and bought counterfeit bags, wallets and other items for prices ranging from $20 to $75, according to lawsuits filed by Coach in federal court in Baltimore this week. Authentic Coach handbags in a similar style are sold for more than $300, according to the company’s website.

In some cases, the investigator said the shops had dozens of imitation Coach products for sale. And, in at least one instance, a shop employee admitted to the undercover investigator that the items were fake, according to the lawsuits.

“To those who traffic in counterfeit goods the message is simple: Coach is looking for you and, once found, will seek the maximum penalties available, including substantial monetary payments,” said Nancy Axilrod, associate general counsel for Coach, in an email to The Baltimore Sun.

Coach and other big-name brands – from Chanel to Louis Vuitton – routinely work with federal and local law enforcement to fight a multibillion-dollar trade in counterfeit goods, many of which originate from China through organized crime networks.

But the fight against counterfeit goods has been complicated in recent years by sellers of illicit products moving online and beyond the traditional hubs of black market knockoffs in New York and Los Angeles to other foot traffic-heavy locales like Ocean City, experts said. In at least one case this year, Coach sued a municipality – Chicago – for not doing enough to crack down on street vendors selling counterfeit company products at a city-run public market.

According to the International AntiCounterfeiting Coalition, a nonprofit based in Washington, the worldwide trade in counterfeit goods amounts to about $600 billion a year. In the U.S. alone last year, Customs and Border Patrol and Immigration and Customs Enforcement seized $260 million worth of counterfeit goods. The top categories of seized counterfeit goods included footwear, consumer electronics, apparel, computer hardware, pharmaceuticals, toys and electronic games, according to the federal agencies.

Companies “are all very serious about it,” said Robert C. Barchiesi, president of the International AntiCounterfeiting Coalition in Washington, which represents more than 200 companies. “Most consumers think it’s a bargain when they buy these goods, but they need to think again because the societal costs are enormous.” Counterfeit goods lead to lost tax revenue and jobs as well as the diminishment of brands in the eyes of consumers who interact with imitation goods, Barchiesi said. “If people are walking around with inferior bags, that doesn’t go far toward protecting the reputation of these quality brands,” Barchiesi said.

In its investigation in Ocean City, Coach alleges that the shops sold handbags, wallets, key chains and wristlets. The shops named in the lawsuits are: Maytalk; Beach Break; Hot Topik; Ocean Reef; Summer Breeze; Surf Beachwear; the Fashion Shop; Ocean Waves; Sunset Beachwear; New York New York; Jewel of the Ocean; Oceanfashion Boutique; and Sunglass City. According to online federal court records, the owners of the shops had not been served with the lawsuits as of Tuesday.

Employees at several locations declined to comment, and management at those stores did not return phone calls. A manager at Oceanfashion Boutique, who refused to give her name, denied that the shop sold Coach counterfeit products. Coach is seeking $2 million in damages for each counterfeit violation at each store or, alternatively, a court order for the store owners to pay Coach all of the profits earned from the sale of the items.

Coach’s lawsuits against the Ocean City shops come as the company has launched its own nationwide campaign, now in its second year, to crack down on the sale of imitation products. Last May, the company kicked off “Operation Turnlock,” a zero-tolerance civil litigation program targeting producers, wholesalers and retailers of Coach fakes. The New York-based company is actively fighting the illegal trade of knockoffs in lawsuits against stores across the country, according to federal court records. So far, Coach has filed about 250 lawsuits and has secured court judgments and settlements for hundreds of thousands of dollars in damages, according to Coach’s Axilrod.

High-profile busts of smuggling rings are routine. Earlier this month, federal authorities shut down a ring in San Francisco that was selling imitation Coach, Kate Spade, Armani and other luxury brands, worth potentially $100 million.

In March, nine people were indicted in federal court and accused of transporting, in 33 shipping containers, hundreds of thousands of fake Nike shoes, Coach bags, Cartier watches and Gucci shoes through the port of Baltimore.


August 13th, 2010

Economic Indicator: Even Cheaper Knockoffs.

by Stephanie Clifford – Courtesy of “The New York Times”.

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Photo Above: On Broadway in New York, shoppers can pick up items of questionable authenticity, and not just of the top luxury brands.

After years of knocking off luxury products like $2,800 Louis Vuitton handbags, criminals are discovering there is money to be made in faking the more ordinary – like $295 Kooba bags and $140 Ugg boots. In California, the authorities recently seized a shipment of counterfeit Angel Soft toilet paper.

The shift in the counterfeiting industry, which costs American businesses an estimated $200 billion a year, plays to recession-weary customers looking for downmarket deals, the authorities say. And it has been fueled in part by factories sitting idle in China. Almost 80 percent of the seized counterfeit goods in the United States last year were produced in China, where the downturn in legitimate exports during the recession left many factories looking for goods – in some cases, any goods – to produce. “If there is demand, there will be supply,” said John Spink, associate director of the Anti-Counterfeiting and Product Protection Program at Michigan State University. In China, he said, “It’s all of a sudden them saying, ‘We have low capacity. What can we make?’ ”

The answer is increasingly knockoffs of lesser-known brands, which are easy to sell on the Internet, can be priced higher than obvious fakes, and avoid the aggressive programs by the big luxury brands to protect their labels, retail companies and customs enforcement officials say. The results: Faux Samantha Thavasa bags for $113 and Ed Hardy hoodie sweatshirts for $82.50. And, bizarrely, imitations that are more expensive than the real ones: In 2007, Anya Hindmarch sold canvas totes that said “I’m Not a Plastic Bag” for $15. Now fakes are available on the Web for $99. “If it’s making money over here in the U.S., it’s going to be reverse-engineered or made overseas,” said Jonathan Erece, a trade enforcement coordinator for United States Customs and Border Protection in Long Beach, Calif. “It’s like a cat-and-mouse game.”

The traders in mid-price fakes are employing another new trick: by pricing the counterfeits close to retail prices – which they can do when the original product is not too expensive – they entice unsuspecting buyers. Any savvy shopper, for example, knows a Louis Vuitton bag selling for $100 cannot be the real thing. But when NeimanMarcus.com, an authorized retailer for Kooba bags, sells them for $295, and a small Web site sells them for $190, a deal-hunting consumer could think she has scored a bargain. (She hasn’t. The $190 bag is a fake.) “If the price points are somewhat close, some consumers get duped into believing they’re getting a real product,” said Robert Barchiesi, president of the International AntiCounterfeiting Coalition, a trade group. “They might be looking for a bargain, but a bargain to buy real goods.”

Photo Below: At the Port of Long Beach, an officer at the Customs and Border Protection office inspects a toy for entry into the country.

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The counterfeiters are also lifting photos and text from legitimate Web sites, further fooling some shoppers. “The consumer is blind as to the source of the product,” said Leah Evert-Burks, director of brand protection for Ugg Australia’s parent company, the Deckers Outdoor Corporation. “Counterfeit Web sites go up pretty easily, and counterfeiters will copy our stock photos, the text of our Web site, so it will look and feel like” the company site, she said.

While all of it is illegal, the authorities do not publish statistics on what brands’ products are being counterfeited. But designers and trade experts said the downmarket trend in counterfeiting became more noticeable over the last year, as counterfeiters got more inventive. The field is big: the total value of counterfeit goods seized by United States customs officials increased by more than 25 percent each year from 2005 to 2008, using the government’s fiscal calendar. In fiscal 2009, as imports over all dropped by 25 percent, the value of counterfeit products seized dropped by only 4 percent to $260.7 million. The official statistics capture only a piece of the problem, companies and experts say, because so many counterfeiters market directly to customers on the Internet and many of those sales go undetected by the authorities. “Online is much harder” to patrol and enforce, said Todd Kahn, general counsel for Coach, the handbag and accessories company. That is particularly true for smaller brands, as Anna Corinna Sellinger, co-founder and creative director of the New York clothing and accessories company Foley & Corinna, learned.

A couple of years ago, she began checking out which Foley & Corinna items were selling on eBay. Her city tote, which now retails for $485, was a popular item, but on some listings “there was something off – it’s a color I never did, or a leather I never did,” she said. As other sites proliferated, and Ms. Corinna Sellinger noticed more and more Internet fakes, she stopped looking altogether. “It’s just too frustrating,” she said. “You can try to do something, but it’s so big and so fast.”

While Ms. Corinna Sellinger basically had herself and a computer to patrol for fakes, big companies use legal teams who train customs officials on the nuances of their product, monitor the Web, ask Internet service providers to take down copycat sites and file lawsuits against sellers. (The brands only go after sellers; the law in the United States does not prohibit consumers from buying counterfeit products.) Ugg Australia, the popular boot brand, developed a full enforcement program after it realized how prevalent copies of its boots were. In 2009, 60,000 pairs of boots were confiscated by customs agents globally, Ms. Evert-Burks said. In the same year, the company took down 2,500 Web sites selling fake products, along with 20,000 eBay listings and 150,000 listings on other trading sites like Craigslist and iOffer. That’s despite the relatively low price of real Ugg boots, which cost around $140 for a basic model. Under similar programs, Versace won $20 million in a recent lawsuit against counterfeiters, while Gucci, Louis Vuitton and other luxury brands have been pursuing similar cases. Coach last year announced “Operation Turnlock,” in which it would file civil lawsuits against counterfeiters, and it has sued 230 times, Mr. Kahn said. At Liz Claiborne Inc., which owns brands like Juicy Couture and Kate Spade, the company has gone after 52 Web sites selling counterfeits, and removed 27,000 auction listings so far this year.

Photo Below: Counterfeit boots are destroyed in Australia after a court sided with Deckers Outdoor, owners of the Ugg boot line.

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The lesson for many counterfeiters has been that they have a better chance of getting away with it if they copy smaller brands like Foley & Corinna – even though Foley & Corinna, while popular with celebrities and fashion types, is not widely recognized as a status brand and its bags can be had for as little as $126 on the brand’s own Web site. “Once it’s out there a lot, people won’t even want the real one because then they’re like, ‘People are going to think it’s fake,’ ” Ms. Corinna Sellinger said. “It takes the product away from the designer.”


August 2nd, 2010

FDA To Revise Current GMPs For Component Controls

The US Food and Drug Administration announced plans to revise CGMP regulations.

By: Angie Drakulich. This story is courtesy of ePT–the Electronic Newsletter of Pharmaceutical Technology.

The US Food and Drug Administration announced plans to revise the current good manufacturing practice (GMP) regulations at a conference held jointly by the agency and Xavier University in Cincinati, Ohio, June 13-16. Brian Hasselbalch, representing the Office of Compliance’s Division for Manufacturing and Drug Product Quality within FDA’s Center for Drug Evaluation and Research, was speaking as part of the first joint annual Global Outsourcing Conference at the school.

According to Haselbalch’s presentation, which is available on the Xavier website, a draft of new CGMP regulations focusing on component controls is expected before the year’s end. Potential revisions include requiring pharmaceutical manufacturers to physically audit their suppliers (i.e., no more paper audits), test containers in each shipment received, implement tamper-evident packaging and security features, notify FDA of contaminated shipments and lots, and to use only those components recognized as safe for their intended use or listed in an already approved application.

In addition to increased enforcement and information-sharing, FDA also plans to play a stronger “guiding role” in corporate responsibility. Hasselbalch offered some recent guidance documents as examples of FDA’s role in encouraging corporate responsibility: process validation, pharmaceutical quality systems, and testing of glycerin for diethylene glycol. It seems the agency will go even further by issuing a second phase of revised CGMP regulations that focus specifically on corporate responsibility. These revisions might include requirements that management assures compliance, performs self-inspections, evaluates and investigates problems, implements change control, and documents training and effectiveness, according to the presentation.

What’s behind the proposed changes? Hasselbalch’s presentation noted growing gaps in quality control caused by factors such as globalization, new technologies and processes, distribution challenges, and increased outsourcing of production. Between 2001 and 2007, he pointed out, the number of products manufactured outside the United States and the number of manufacturing sites abroad doubled. Some of the new products being imported into the US come from countries with “less developed regulatory systems,” according to the presentation. Along with these more complex supply chains, there has been an increase in pharmaceutical cargo thefts and in drug counterfeiting. More preventative measures are therefore needed.

Industry will have a chance to comment on the proposed revisions once they are issued.

Note: On June 24, 2010, an FDA press officer clarified that the agency is “considering requiring finished pharmaceutical manufacturers to conduct on-site audits of the original manufacturers for components (i.e., ingredients) that they use in manufacturing.”

The End.

Digest Break – Quotes To Make You Think.

“When everything seems to be going against you, remember that the airplane takes off against the wind, not with it.” — Henry Ford

“Make crime pay. Become a Lawyer.” — Will Rogers

“Few things are more satisfying than seeing your own children have teenagers of their own.” — Doug Larson


July 14th, 2010

Drug Packaging Serialization.

New FDA final guidance jump-starts track and trace.

This article courtesy of Stephen Barlas and Contract Pharma Magazine

serialization binary codes

The FDA’s publication of the final guidance on a standard numerical identifier (SNI) for pharmaceutical packages at the end of March awoke the drug industry from its track and trace slumber. Manufacturers, distributors, pharmacies and their vendors had been snoozing since September 2008, when California pushed back its e-Pedigree implementation date, an action with significant national implications. Instead of having to put unique serial numbers on packages starting January 1, 2011, California, responding to pleas from an ill-prepared drug industry, pushed back that e-Pedigree deadline to January 1, 2015. One-half of all drug packages arriving in the state on that date will have to have unique serial numbers printed on them. The other half will have to follow suit one year later.

“Everybody took a deep breath when the California Board of Pharmacy delayed its e-Pedigree requirement,” agreed Ruby Raley, director, healthcare solutions, Axway, a company that provides the software to run the data repositories that hold information about drug package pedigrees as an individual package moves from the manufacturer to (perhaps) a repackager to a wholesaler and on to the retail or hospital pharmacy. Axway is involved in numerous track and trace pilots with a number of major pharma companies. “Nothing happened last year,” she remarked.

Now, publication of an FDA-approved package serialization scheme has given the pharmaceutical industry a reason to restart its version of California Here I Come. Whereas the California Board of Pharmacy provided no specifics on package serialization, the FDA has; manufacturers no longer have to wait and guess what might be acceptable in the Golden State come January 1, 2015, a date that, given the complexities of e-Pedigree compliance, isn’t so far away.

James McCrory, vice president, products and technology at rfXcel Corp., said, “The SNI guidance is a big deal in three ways. It reflects new interest in federal government safety of prescription drugs, provides endorsement of GS1, which is pretty big since people have been hanging back waiting to see what happens, and matches what leaders and distributors and manufacturers are doing in their own pilots.” The SNI essentially endorses the serialization standard adopted by the international standards group GS1. GS1 has one serialization standard for numbers printed in 2D barcodes (GT10) and a second one for numbers printed on radio frequency identification (RFID) tags (G10).

An agreed-upon format for an item-level SNI is only the first step in a closed-loop e-Pedigree (often used synonymously with track and trace) system such as the one adopted by California, and likely to be endorsed by Congress. Other follow-on elements include:

Security framework for data exchange,

Record retention policies,

SNIs at the pallet and case level,

Standardized chain-of-custody data to be tracked by logistical units,

Standardized electronic data exchange format,

Data carriers with specific encoding formats identified,

Guidelines for reporting exceptions noted by supply chain participants, and

Hierarchy of the SNIs expected in a shipment.

The FDA SNI provides a first-step level of certainty to manufacturers, in terms of compliance with federal expectations, and assures them that the U.S. is moving in the same basic direction as other countries, many of whom are far more advanced in their national track and trace requirements. That is all true despite the limitations of the FDA guidance: it is a suggested package identification formula. There is no federal requirement that drug manufacturers follow it, much less put a serial number on each item-level package.

The limits of the FDA guidance, some of its nuances and its failure to address the important issue of which technology should be used to print the SNI have all combined, apparently, to seal the lips of pharmaceutical manufacturers who just three years ago were touting their track and trace efforts. Prominent proselytizers such as Pfizer, Abbott and Purdue Pharma have declined to comment on the FDA final guidance on an SNI. “I ran this request up the flag pole and have learned that we are unable to grant interviews on this topic,” explained Libby Holman, spokeswoman for Purdue Pharma, which has been an aggressive track and trace experimenter because of its manufacture of OxyContin, a popular target of drug diverters.

Tom McPhillips, vice president, U.S. Trade Group, Pfizer Inc., did not return an e-mail requesting comment. Mr. McPhillips, in his comments to the FDA after the draft guidance was published, asked the agency not to require manufacturers to print the national drug code (NDC) as part of both the machine readable and human readable SNI. The FDA rejected that request.

Nonetheless, manufacturers support the specificity of the SNI, and its agreement with GS1 standards, which gives them more certainty than California’s prescription for a unique serial number. The only guidance in the Golden State law, according to Virginia Herold, executive officer of the California Board of Pharmacy, is that the number be part of an “interoperable” track and trace system. The FDA-recommended SNI is a unique combination of two numbers printed on a package label that identifies the drug inside the package. The FDA final guidance specifies that half of the SNI is the national drug code (NDC), which is essentially unique for each drug made by each manufacturer, coupled with a unique serial number for the second half, generated by the manufacturer or repackager for each individual package. Serial numbers should be numeric or alphanumeric and should have no more than 20 characters. The SNI should be both machine and human readable.

The use of a GS1-compatible SNI means that manufacturers following the FDA guidance are very likely to comply with European, Brazilian, Norwegian and other national requirements for drug package serialization. Meanwhile, other countries are putting track and trace requirements into place, in some instances with more speed than the U.S. Ms. Raley explained that governments footing the bill for public healthcare (e.g. the EU, Brazil, Turkey) are especially concerned about counterfeit product sneaking into the country, since the government does not collect taxes on those transactions. “People are sneaking product in at the border, that is driving government concerns,” she explained.

In the U.S., the FDA has been more concerned about the prospective impact of counterfeit drugs on public health and safety. The 2007 Heparin recall underlined the value of track and trace (had it been deployed by the pharmaceutical chain) with regard to drug recalls. Preventing thefts is an important affiliate benefit, too. In March, thieves broke into an Eli Lilly warehouse in Enfield, CT and stole $75 million worth of prescription drugs. The crooks took pallets of the anti-cancer drugs Gemzar and Alimta, the schizophrenia drug Zyprexa, the antidepressant Cymbalta and other prescription medicines. Theoretically, those stolen drugs could not come back into the legal distribution chain if they had SNIs printed on 2D barcodes or RFID tags on each package’s label.

It is clear that manufacturers are the big winners, relatively speaking, from the final guidance. Scott Melville, senior vice president for government affairs for the Healthcare Distribution Management Association (HDMA), said, “The FDA guidance provides manufacturers and the entire pharmaceutical supply chain with needed clarity.” But while the HDMA has welcomed the guidance, it clearly did not get everything it wanted. For example, the HDMA had not wanted the FDA to endorse an “alphanumeric” as a serial number option.

However, Anita Ducca, senior director, regulatory affairs at HDMA, acknowledged the FDA was responsive to her group’s concerns. “We had a number of things we wanted the FDA to change from its draft guidance and for the most part the agency did that,” she states. “Our members are ready and willing to work within the parameters of the guidance.”

Neither did hospitals and pharmacies get exactly what they wanted. Some pharmacy groups had also pushed for a different SNI. The American Society of Health System Pharmacists (ASHP) had urged the FDA to modify the NDC number so that its components included the RxNorm CUI as the drug/form/ dose component of the code. Justine Coffey, JD, LLM, director, federal regulatory affairs, said, “Currently, ASHP members are struggling with inconsistencies relating to the National Drug Code (NDC) and its application to barcode point-of-care, clinical information systems, and hospital financial systems.”

Axway’s Ms. Raley noted that hospitals are particularly concerned about avoiding medication errors, especially given the passage of the health care reform bill, which mandates a number of new payment methodologies based on the hospital reducing errors of all kinds. She explained that many drugs come in many formulations and doses, information which will not be gleaned from the SNI endorsed by the FDA. Ms. Raley pointed out that hospitals are particularly sensitive to this issue given the publicity generated by the misadministration of Heparin to twins born in November 2007 to the actor Dennis Quaid and his wife.

Minor reservations aside, the HDMA’s Mr. Melville emphasized that the final guidance allows his members and everyone else to move forward. “The first step in an e-Pedigree system is putting a number on the package,” he said. “The second step is what you do with that number.”

For distributors a big issue is how the SNI is printed on the item-level package label. The two options that have emerged over the past half-decade are a 2D barcode or a radio frequency identification (RFID) tag. Distributors have generally favored RFID tagging, since they could check in packages to their warehouses without a reader having to be “in the line of sight” with the individual package. This saves them time, which is important because any e-Pedigree requirement costs the distributor money and earns the company no profit. But RFID tags are expensive, and manufacturers have generally pushed for printing serial numbers within 2D barcodes, not just because the labels are cheaper, but because the packaging lines can run faster than they could if RFID tags are printed on the package. Moreover, RFID tags cannot be used on some products.

The final guidance on the SNI appears, however, to endorse 2D barcode serialization without actually saying so. “The FDA landed on 2D,” stated Ms. Raley. “It is very clear they talked about the total acceptability of 2D although they did not rule out RFID.” RFID does have some significant shortcomings when it comes to package use, such as its deleterious effect on biologics.

Robert Celeste, director, healthcare, GS1 US, said that in fact all the manufacturers who have done pilots, and are doing them now, are putting serial numbers on packages via 2D barcodes. Some are also putting RFID tags on the product label, and on cartons and pallets. He believes it is possible that RFID tags on item-level packages may have utility – if their per unit price comes down – in certain applications, for example, where products must be kept at certain temperatures.

The final guidance, however, is silent on serialization of cartons and pallets, which the California Board of Pharmacy, just to cite one interested party, had pushed for, and on which the FDA had asked for comments.

While the pharmaceutical supply chain now knows that the SNI is the baseline for complying with California’s e-Pedigree requirement, everyone up and down the chain is pushing for federal legislation that would make the California requirement, or some close version of it, national law and might resolve outstanding technology questions as well. The 2007 congressional law that required the FDA to publish some sort of SNI within 30 months – it did not specify guidance versus more legal regulation – also told the FDA to “develop standards and identify and validate effective technologies for the purpose of securing the drug supply chain against counterfeit, diverted, subpotent, substandard, adulterated, misbranded, or expired drugs.” The FDA received comments but has done nothing to impose a technology solution, which various players in the drug distribution chain would probably oppose, but which is clearly necessary.

In the 2007-2008 session of Congress, Reps. Steve Buyer (R-IN) and Jim Matheson (D-UT) introduced the Safeguarding America’s Pharmaceuticals Act, which would have established a federal e-Pedigree mandate. That law has not been reintroduced in the current Congress, perhaps, suggested Ms. Herold of California’s Board of Pharmacy, because members of the House and Senate have been overwhelmed with healthcare reform, financial reform and economic recovery. Also, the same sense of urgency that disappeared in California in September 2008 disappeared from Congress at about the same time.

As the HDMA’s Mr. Melville put it, “We want a uniform federal pedigree standard. We can’t have barriers to movement of products.” He added that Reps. Buyer and Matheson, at a hearing on March 10, stated they are working on a redrafted version of their bill. “We are very hopeful it will be reintroduced soon,” said Mr. Melville. “We expect it to look like the California implementation schedule.”

The End

Stephen Barlas is a freelance writer who has written several articles on pharmaceutical packaging for Contract Pharma. He can be reached at sbarlas@verizon.net.


June 2nd, 2010

We All Wish Bob Uecker Well.

Everyone at ATL wishes Bob Uecker well, and we hope he has a speedy recovery after his heart surgery. I have been a fan of Mr. Baseball for more than 40 years. Below is a picture of Merle Harmon (left side), Bob Uecker (right side) and me (Donald Dobert, center). This picture is from Milwaukee County Stadium, 1973.

Uecker-Dobert 1973

The photo below is of ATL Special Project Engineer Doug Czarnecki (age 9) with Merle Harmon and Bob Uecker, also from 1973.

Uecker-Czarnecki 1973


May 16th, 2010

Notable And Quotable.

“The brain is a wonderful organ; it starts working the moment you get up in the morning, and does not stop until you get to work.” — Robert Frost

RobertFrost


April 28th, 2010

Operation Spring Cleaning. Anti-Counterfeiting Stings From Around The Country.

Samples of News Clips from April Counterfeit Goods Sweep “Operation Spring Cleaning”.

COUNTERFEIT PRODUCTS WORTH $263 MILLION SEIZED IN TWO MAJOR INVESTIGATIONS. The Washington Post (4/27/2010) reports on the announcement Monday of the seizure of “$263 million worth of counterfeit products — much of it smuggled through Baltimore — following two long-term investigations. The National Intellectual Property Rights Coordinator Center, a partnership among several government agencies, spearheaded the so-called Operation Spring Cleaning, which resulted in more than $44 million in seizures of fake products, including DVDs, circuit breakers, luxury goods and medications, from ports across the country over the past three weeks. In addition, 45 people were arrested on federal and state counterfeiting charges as part of the operation. Immigration and Customs Enforcement officials also seized $219 million in counterfeit merchandise made in Asia and shipped through Baltimore this month as part of a separate investigation over several months.”

U.S. Seizes Big Batches of Fake Goods. Wall Street Journal (4/26/2010) notes U.S. law enforcement “made their biggest-ever seizures of counterfeit goods this month in two operations that netted more than $240 million in total as part of a broader federal offensive against the trafficking of pirated products. Federal, state and local law enforcement officials, part of the National Intellectual Property Rights Coordination Center, confiscated about $40 million worth of counterfeit goods, including fake Rolex watches, Coach handbags, and Nike shoes, as well as pirated DVDs and fake pharmaceutical products, in a sweep of more than 30 U.S. cities. And as part of a separate, long-running investigation, federal officials confiscated $200 million in fake goods made in Asia and smuggled through the port of Baltimore. “Intellectual property theft steals a whole lot. It steals jobs, creativity, it funds organized crime, and it’s a serious risk to public safety,” said John Morton, assistant secretary for U.S. Immigration and Customs Enforcement, or ICE, at the Department of Homeland Security.”

Pirated DVD Salesmen Busted. The McAllen (TX) Monitor (4/27/2010) reports, “Three pirated DVD salesman arrested at a Starr County flea market are among 45 people netted in a nationwide dragnet against counterfeiting operations, US Immigration and Customs Enforcement announced Monday. Agents detained Mauro Bazan Jr., Esteban Trevino Ramirez and Rodolfo Sanchez Vela on April 17 after finding them in possession of nearly 6,700 forged DVDs. Legitimate DVDs would be worth an estimated $127,000.” The men were arrested “as part of the nationwide ‘Operation Spring Cleaning’ which resulted in the seizure of $263 million in fake merchandise in cities such as San Antonio, Houston, Dallas, Seattle, New York, Miami and Detroit.”

Fake Rolexes Bulldozed In Philadelphia. The Philadelphia Daily News (4/27/2010) reports on the bulldozing on 7,000 counterfeit Rolex watches marking “the grand finale of an international multimillion-dollar federal counterfeiting case some 20 years in the making – unveiled on World Intellectual Property Rights Day.” Counterfeit Rolex manufacturer Binh Cam Tran “started as a legitimate watchmaker on Jewelers Row on Sansom Street near 7th, then got into the counterfeit world, said John Kelleghan, special agent in charge of the Office of Investigations for US Immigration and Customs Enforcement here. He ended up manufacturing the watches in his North Philadelphia rowhouse and kept moving to better quarters – ending up in Elkins Park, where he owned a fleet of Lexus cars.” WCAU-TV Philadelphia (4/27) and KYW-AM Philadelphia (4/27, Glovas) cover the bulldozing on their websites. WCAU-TV Philadelphia (4/26) aired a report on the bulldozing, as did WTXF-TV (4/26/2010).

KRGV-TV Rio Grande Valley (4/27/2010) reports approximately “$1.1 million of counterfeit merchandise was seized from two locations in the South Texas area in April. It was part of a nationwide seizure announced by the federal partners of the National Intellectual Property Rights Coordination Center (IPR Center). In total, more than $263 million worth of counterfeit merchandise was seized around the country.” DHS Assistant Secretary for ICE John Morton “revealed these results at an observance of World Intellectual Property Day at the IPR Center in Arlington, Virginia.” KABB-TV San Antonio (4/26/2010) also aired a report on the results of Spring Cleaning.

Counterfeit Nikes Seized In New Jersey. The AP (4/27/2010) reports ICE officials announced the seizure of “15,000 pairs of fake Nike shoes at Port Elizabeth as part of a nationwide sweep of counterfeit products. … They say more than 700,000 fake items were found in 30 cities during Operation Spring Cleaning. The counterfeit goods included medicines. … ICE spokesman Harold Ort said the Nike sneakers found in two shipping containers in New Jersey were worth $1 million.”

7 Mile Fair Seizures Noted. WITI-TV Milwaukee (4/26/2010) aired a report on ICE’s bust of counterfeit goods at 7 Mile Fair as part of Spring Cleaning.


April 26th, 2010

New York City Crackdown On Counterfeiters.

Michael_R_Bloomberg

Photo above: Michael R. Bloomberg

Mayor Michael R. Bloomberg, Chief Advisor to the Mayor for Policy and Strategic Planning John Feinblatt and Director of Special Enforcement Shari C. Hyman today announced a $800,000 payment to the City that settles the “Counterfeit Triangle” case and reopens a key block of Manhattan’s Chinatown.

The City will receive the payment from the owners of a single triangular block that was notorious for the sale of counterfeit goods. The lawsuit, a civil nuisance abatement action, was filed after a February 26, 2008 raid that shuttered 32 storefronts selling counterfeit goods. Under the terms of the settlement, the property owners must use the building, bounded by Canal, Centre, and Walker Streets, for legitimate purposes.

“Property owners should know that they are responsible for what goes on in their buildings and that hosting illegal activity like counterfeiting is a losing proposition,” said Mayor Bloomberg. “Counterfeiting deprives legitimate businesses of customers and their employees of their paychecks. We will continue to go after the street-level counterfeiters, the wholesalers, and the property owners that look the other way.”

In the raids that triggered the lawsuit, the Mayor’s Office of Special Enforcement seized counterfeit trademarked products, including counterfeit watches, jewelry and handbags purporting to be from Rolex, Tiffany, Coach, Gucci, Chanel and others. These products had an estimated street value of over $1 million.

“Selling counterfeit goods is a form of organized crime it is built on forced sweatshop labor, often done by children and frequently accompanied by violent turf wars,” said John Feinblatt, Chief Advisor to the Mayor for Policy and Strategic Planning. “Counterfeiting has been involved in every illegal enterprise from money laundering to supporting terrorism. This remains an ongoing problem, but we will continue to go after any property owners that look the other way while their tenants flout the law.”

“Counterfeit goods are inferior products that cheat everyone, from the consumer who purchases a poorly-made item, to the legitimate business owners cheated of sales, to the City who loses tax revenue,” said Shari C. Hyman, Director of the Mayor’s Office of Special Enforcement. “Property owners should know that if they play host to illegal vendors, we will use the Nuisance Abatement law to shut down the buildings and exact a serious financial penalty.”

As part of the Mayor’s Office of Special Enforcement investigation, 42 undercover purchases were made in a series of the buildings’ 32 storefronts. The investigation uncovered counterfeits of Coach, Gucci, Dolce & Gabbanna, Dior, Prada, Rolex, Fendi, Burberry, Calvin Klein, Dora the Explorer and Oakley. The building addresses in the Counterfeit Triangle are 224 – 230 Canal Street; 232 Canal Street; 234 – 238 Canal Street; 106 Baxter Street; 112 – 116 Walker Street; 118 Walker Street; 120-124 Walker Street; and 152-156 Centre Street.

fake 002

Photo above: examples of fake goods.

Mayor Bloomberg created the Office of Special Enforcement by Executive Order in December, 2006. It replaced the former Office of Midtown Enforcement and expanded its activities to all five boroughs. The Office of Special Enforcement is responsible for coordinating enforcement efforts across City agencies to address quality of life issues related to notorious adult use locations, lawless clubs, trademark counterfeiting bazaars and illegal conversions of apartment buildings into hotels.

The Office of Special Enforcement and its predecessor has, since 2003, shut down 36 counterfeiting locations, seized some $52 million in knock-off goods and forced building owners and counterfeiters to pay $3 million in fines to the people of New York City.


April 6th, 2010

Drug Safety: An Update From The FDA.

Statement of Joshua M. Sharfstein, M.D., Principal Deputy Commissioner, Food and Drug Administration, Department of Health and Human Services

Before the Committee on Energy and Commerce Subcommittee on Health, U.S. House of Representatives, March 10, 2010

Joshua Sharfstein

INTRODUCTION

Mr. Chairman and Members of the Subcommittee, I am Dr. Joshua M. Sharfstein, Principal Deputy Commissioner at the Food and Drug Administration (FDA or the Agency) in the Department of Health and Human Services (HHS). Thank you for the opportunity to discuss the safety of the American drug supply.

Protecting Americans from unsafe or contaminated drugs is not just an important responsibility of FDA-it is our core charge. Drug safety was the primary reason for the passage of our guiding statute. In 1937, more than 100 people, including many children, died from ingesting Elixir Sulfanilamide, which contained the deadly poison diethylene glycol. Congress then passed, and President Franklin D. Roosevelt signed, the Federal Food, Drug, and Cosmetic Act (FD&C Act) to prevent future catastrophes.

And yet, as you know, the threat remains.

I would like to thank the Subcommittee for its leadership on this issue. Numerous hearings in this chamber have helped the public understand the challenge of regulating a global marketplace. Members of this Subcommittee, along with the Chairman of the full Committee and the Chairman Emeritus, were key architects of the Food and Drug Administration Amendments Act of 2007 (FDAAA), which gave the Agency significant new authorities and resources to address postmarket safety. In this testimony, I will address two important issues: import safety and the implementation of the drug safety authorities in FDAAA.

IMPORTS

As the Subcommittee’s work has documented, globalization has created new risks and challenges for the safety of the drug supply. Where Americans once used drugs that were mostly manufactured domestically, now up to 40 percent of the drugs we take are imported, and up to 80 percent of the active pharmaceutical ingredients in the drugs we use are from foreign sources. In addition to the growth in the sheer volume of imports and foreign facilities, there has been an increase in the variety and complexity of imported products, and a large expansion in the number of countries involved in producing these products-including many with less sophisticated regulatory systems than our own. Simultaneously, the supply chain from raw material to consumer has become more and more complex, involving a web of repackagers and redistributors in a variety of locations. This makes oversight significantly more difficult and leaves weaknesses through which counterfeit, adulterated, and misbranded products might infiltrate the legitimate supply chain.

A few examples:

* In 2007 and 2008, contaminated heparin (a blood-thinning drug) came from China and was linked to deaths and a number of serious allergic-type reactions here at home.

* Counterfeit Tamiflu (oseltamivir phosphate) was discovered during the novel H1N1 outbreak.

* In 2007, Xenical (orlistat) capsules ordered over the Internet were found to be composed only of talc and starch.

* In January 2010, counterfeit Alli (orlistat) was discovered, which did not contain the active ingredient but instead contained varying amounts of the stimulant sibutramine, which can lead to serious toxicity if used by people with certain cardiac diseases.

These are global problems. Contamination and counterfeit drugs represent a much greater threat in the developing world, where the systems of laws and regulatory oversight do not afford much protection. And these problems can pose a risk to us at home, when, for example, patients do not get fully treated for infection abroad because of ineffective drugs and as a result, drug resistance intensifies.

Bucket shop 1

Photo above: Fake drugs are made on equipment like this in filthy conditions.

Photo below: Fake drugs are re-labeled and re-packaged so they look “genuine”. This puts you at risk. This could kill you.

Bucket shop 2

When the modern FDA was created in 1938, imports were a tiny part of the products used in our country. Our focus was on stopping harmful products at the border through inspections of imported goods. This approach is adequate to the challenge when the volume is small. But it fails when an estimated 20 million shipments of FDA-regulated imports come into the country each year. To fulfill our public health mission in a global age, FDA must adopt a new approach-one that addresses product safety by preventing problems at every point along the global supply chain, from the raw ingredient through production and distribution, all the way to U.S. consumers.

We are moving from an approach based on reacting to problems to one that proactively prevents such problems from ever occurring. In the food arena, this approach to prevention is embodied in legislation passed by this Committee and the full House of Representatives, and which is now awaiting action in the Senate. This bill would for the first time allow FDA to establish basic preventive controls throughout the food production process and give the Agency strong enforcement authorities and resources to meet these obligations.

In the arena of drugs and other medical products we are taking a number of steps to begin making this shift within our current authorities.

First, we are seeking better controls at the point of production, wherever that may be.

We now have permanent FDA offices in Beijing, Shanghai, and Guangzhou, China, in New Delhi and Mumbai, India, in San Jose, Costa Rica, Mexico City, Santiago, Chile, and soon, Amman, Jordan. These offices enable us to have a regional presence around the world, a home base from which to undertake a range of important activities, including building regulatory capacity. We now have more than 30 agreements with foreign counterparts to share inspection reports and other nonpublic information that can help us make better decisions about the safety of foreign products. So if a shipment of contaminated drugs shows up in a port in Italy, we will hear about it swiftly and be on the lookout for products from the same shipper.

Second, we are working with industry to help them strengthen the safety of their supply chains. In this day and age, companies should be able to effectively demonstrate that safety, quality, and compliance with international and U.S. standards are built into every component of every product and every step of the production process. Some companies already do a terrific job at this, tracking where and how their products and their components are made and the path taken to reach our shores. In fact, I have met with some companies that react with incredible swiftness to questions about the integrity of their supply chain. Obviously they have a vital interest in ensuring confidence in the safety and quality of their products and their brand. These best practices need to become standard practice throughout industry.

There is much more to be done. As Secretary of Health and Human Services Kathleen Sebelius noted when she appeared before this Committee on February 4, 2010, FDA needs additional tools to move our oversight capabilities into the 21st century. FDA needs to access regulatory information quickly, hold all parties responsible for the quality of products in the supply chain, and have reasonable and reliable options for enforcement.

DRUG SAFETY AUTHORITIES IN FDAAA

I will now turn to the drug safety authorities in FDAAA, a milestone legislative achievement that has helped the Agency protect the public health in many different ways.

Because no amount of premarket study can provide the full information about what the benefits and risks of a new drug will be when it is used by the general population, FDAAA provided important new authorities to enhance our ability to monitor approved drugs after they are marketed and to take definitive action when needed. Under FDAAA, FDA can require drug sponsors to conduct postmarketing studies and clinical trials, make certain safety-related labeling changes, and develop and put into place risk evaluation and mitigation strategies (REMS)-all with the goal of better identifying and managing the risks of drugs on the U.S. market.

Here are some details.

With respect to label changes, as of February 28, 2009, FDA had used its new authorities to require safety label changes in individual or classes of drugs 32 times since March 25, 2008. For example, FDA required safety label changes to add the risk of a life-threatening neurological disorder to the prescribing information for certain antidepressants, and changes to the prescribing information of a class of antibiotics to warn about the risk of tendon rupture.

With respect to risk management, if FDA determines that a REMS is necessary to ensure that the benefits of a drug outweigh the risks of the drug, FDA can require manufacturers to have a REMS in place when a drug comes on the market, or implement one later if FDA becomes aware of new safety data . The authority to require REMS provides FDA a very useful set of tools that can be used to reduce the risks of marketed products, while allowing patients to benefit from lifesaving and other beneficial treatments that could not be safely marketed without a risk management program.

In the design of REMS with elements to ensure safe use (the most comprehensive REMS programs), FDA is mindful of the provisions in FDAAA stating that the elements to ensure safe use must be, among other things, commensurate with the specific serious risk listed in the FDA-approved labeling of the drug, not be unduly burdensome on patient access to the drug, and be designed to be compatible with established distribution, procurement, and dispensing systems for drugs.

Most of the REMS with elements to ensure safe use include educating prescribers about the risks and appropriate use of the drug as a condition of certification or enrollment in the REMS program. Other programs require enrollment by pharmacists and sometimes patients as well. Some programs require the prescriber to monitor the patient immediately following drug administration and for a period of time afterwards. Each of these programs is designed to provide critical information to clinicians without unduly restricting access to the drugs.

We have learned that designing and implementing the most comprehensive REMS requires a careful balancing of the need to adequately manage risks and also to maintain patient access to important medications. Since using this authority is a work in progress, FDA is committed to addressing the concerns we have heard from prescribers, pharmacists, distributors, and payers about their roles in implementing REMs and from patient groups about the effects of REMS on access to needed products, and are planning to hold a public meeting to hear from these and other stakeholders. Additional implementation challenges include ensuring consistency in the handling of safety problems with all products, including over-the-counter (OTC) products and generic drugs; the lack of clarity in certain provisions of the law with respect to REMS; and burdens imposed on application holders and FDA that do not contribute significantly to drug safety. We would be very happy to discuss the lessons we have learned over the last two years with Congress and work together to fine tune the program so that it can be even more effective in improving public health.

Sentinel Initiative

FDAAA requires the HHS Secretary to develop methods to obtain access to disparate data sources and to establish a postmarket risk identification and analysis system to link and analyze health care data from multiple sources. On May 22, 2008, FDA launched the Sentinel Initiative with the ultimate goal of creating and implementing the Sentinel System-a national, integrated, electronic system for monitoring medical product safety. The Sentinel System, once up and running, will enable FDA to actively gather information about the postmarket safety and performance of its regulated products-a significant step forward from our current, primarily passive safety surveillance systems. The law sets a goal of access to data from 25 million patients by July 1, 2010, and 100 million patients by July 1, 2012. FDA has gathered public input on issues related to the creation and development of Sentinel, held numerous meetings and a public workshop, and established a working group consisting of representatives of numerous federal agencies to share information and discuss issues related to ongoing efforts that are complementary to Sentinel. FDA has awarded key contracts for a pilot project to gather information that will be essential to fully implementing the Sentinel System.

Track and Trace

Scanner (Small) with bottle

FDAAA also required the development of standards for the identification, validation, authentication, and tracking and tracing of prescription drugs as a step towards further securing our nation’s drug supply. Very shortly, FDA will issue a guidance establishing a standard for unique identification for prescription drug packages, which ultimately will help in identifying the whereabouts and authenticity of drug packages and distinguish them from counterfeits.

SAFE USE INITIATIVE

Before I close, I would like to briefly mention a new drug safety initiative at FDA called the Safe Use Initiative. Every approved drug has both benefits and risks. Underlying FDAAA is the principle that Congress wants to see the benefits maximized for patients and the risks minimized. We all want patients to get better on medication and avoid unnecessary injuries, even death, as a result of preventable medication errors or misuse. In November 2009, we announced the launch of FDA’s Safe Use Initiative. Through this initiative, FDA will identify, using a transparent and collaborative process, specific candidate cases (e.g., drugs, drug classes, and/or therapeutic situations) that are associated with significant amounts of preventable harm. FDA will then work with hospitals, doctors, nurses, patient groups and others to recognize and mitigate these risks. In a voluntary complement to the REMS program, we will use our understanding of drug risk as a tool to gather partners together and develop and implement strategies for progress.

CONCLUSION

Over the last seven decades, so much has changed in pharmaceutical science and drug regulation. Yet in 2007, when scores of patients died of contamination in Bangladesh, and in 2006 when children died in Panama, the culprit was familiar. It was diethylene glycol, or DEG-the very same poison that had led to the passage of the FD&C Act in 1938.

FDA’s work is far from done. The scientists, doctors, nurses, inspectors, and other public health professionals who make up FDA thank you for your support and confidence in our mission.

Thank you very much for the opportunity to testify today. I welcome your ideas and your questions.

Joshua M. Sharfstein, M.D.


March 30th, 2010

$75 Million In Stolen Pharmaceuticals Now Head To Black Market.

Prescription Drugs Heist

The Eli Lilly warehouse is seen here in Enfield, Conn., Tuesday, March 16, 2010. Authorities say tens of millions of dollars worth of prescription drugs have been stolen in a brazen, well-planned heist at a pharmaceutical company’s regional warehouse in Connecticut. (AP Photo/Journal Inquirer, Leslloyd F. Alleyne).

DRUG THEFT

Please read the entire story as written Matthew Perrone and published by The Associated Press. Because of copyright laws I cannot print it at this location.

Please read our article “Mixing It Up” which immediately follows this story. You will gain some valuable insight as to how track and trace/ security labels and packaging can protect the public from incidents such as this.


March 21st, 2010

Mixing It Up.

Mixing and rotating overt, covert, and forensic technologies can thwart counterfeiters.

By Donald J. Dobert
President and Chief Operating Officer
ATL Security Label Systems

It has been said dozens of times already, there is no silver bullet against counterfeiters and diverters. You’ve got to layer, layer, and layer some more. In the photograph below we have illustrated the different “layers” of a 3D hologram. These invisible layers give the security label three color kinetic movement.

These “layers”, which are not immediately known to the counterfeiters, can be mixed and rotated to protect original products and documents. In the example below a German ID card has hologram layers that reveal a pattern when the card is moved back and forth.

In the photo below, courtesy of Graphic Security Systems Corporation, Lake Worth, FL, you can easily see how (during manufacturing) each “layer” is structured with different anti-counterfeiting properties.

Just what exactly does layering mean? What layer comes first, what layers need constant updates, and what layers stay put? Who decides when and when to layer, when to update the layers, and when do you need to inform FDA?
A “mix and rotate” approach brings multiple technologies together in one package. To “mix and rotate” can be compared to software updates. As computer hackers invent new “bugs,” software companies develop new “anti bugs.” Every time you as a brand owner produce your product, you can “mix and rotate” the following security features:

Tamper-evident breakaway closures.
Invisible, hidden markers.
Anticounterfeiting holograms.
Color-shifting inks.
Tamper-evident unit closure.
Mass-serialization.
Two-dimensional bar codes.
RFID chips.
Void security closures or destructible tapes.

Here is an example. Tamper-evident substrates can employ destructible, paper-based face stock or nonreproducible covert security fibers. Distribution can be limited to approved secure suppliers for a secure chain of custody. Tamper-evident substrates can make label removal impossible without visible damage. Such features effectively deter remarking and help ensure product authenticity. They also provide simple in-field authentication.
In addition, color-shifting inks and other covert features can be public signals of authenticity. Invisible forensic markers alone can be used to detect whether a product has been repackaged or relabeled. Such forensic markers may be used in the varnish on the package as well as customized or serialized codes and holograms.
Combining these technologies, the hologram would be an overt feature, the forensic marker would be a covert one, and the code could be either overt or covert, depending on what you are doing with it. Special codes can be purchased or created that pertain to only one product, which tells the manufacturer where it was made, how it was distributed and on what days. While there are codes that are very obvious and basically list manufacture date and product code, there is a wide range of options in customized codes.
A Ubiquitous Example
Modern U.S. currency has changed many times over the past few years. With the exception of the one-dollar bill, all of these notes are obsolete (see photo below). This is because the U.S. government “mixes and rotates” (M&R) its overt and covert techniques to stay one step ahead of the counterfeiters.

Shown below are examples of anti-counterfeiting “layered levels” of the “ever-changing” “face” of U.S. notes. You will notice the different colors when compared to the notes that are now obsolete:


Overt and covert M&R anticounterfeiting measures include fine detail with raised intaglio printing on bills. This allows nonexperts to easily spot forgeries. As a side note, on coins, milled or reeded (marked with parallel grooves) edges are used to show that none of the valuable metal has been scraped off. This detects the shaving or clipping (paring off) of the rim of the coin. However, this does not detect sweating, or shaking coins in a bag and collecting the resulting dust. Since this technique removes a smaller amount, it is primarily used on the most valuable coins, such as gold.
For paper bills, in the late twentieth century, advances in computer and photocopy technology made it possible for people without sophisticated training to easily copy currency. To combat this, national engraving bureaus began to include new (more sophisticated) anticounterfeiting systems such as holograms, multicolored bills, and embedded devices such as strips, microprinting, and inks whose colors change depending on the angle of the light. New technology also includes the use of design features such as the “Eurion Constellation,” which disables modern photocopiers.

Detecting counterfeit bills often isn’t easy to do by eye. One bogus $100 bill believed to have been made in North Korea, for instance, would be nearly impossible for a novice to identify as a fake. It has the security strip on the left side of the bill and a watermark of Ben Franklin (whose portrait is on the bill) on the right-hand side, as well as replicating other security features. However, its paper contains no starch and doesn’t reflect ultraviolet light, which is one sign of a counterfeit.Photo Below. The portrait on a genuine $50 bill (left) compared to a counterfeit. Notice the relative flatness and lack of detail on the fake bill.

Photo Below: The portrait on a genuine $50 bill (left) compared to a counterfeit. Notice the relative flatness and lack of detail on the fake bill.

Photo Below. $50 bill with three security features highlighted. A section of the security thread is visible in the circle near the portrait. The large circle to the right shows the watermark, and below that the color-shifting ink is circled.

There is now a scanner that searches for missing covert features in bogus “Super Dollars.” The device looks at several aspects of the bill to confirm its legitimacy. U.S. paper money is printed with magnetic ink, but that’s also used for many fraudulent bills. On real bills, the ink is distributed in a consistent pattern whose magnetic resonance can be mapped. The magnetic map is stored in the scanner, as well as three other maps containing ultraviolet, infrared, and other measurements taken from legitimate bills. Scanning a bill takes less than one second. If there’s any spike or anomaly in any of the threads of data, the scanner rejects the dollar.

Photo Below. Beginning with Series 2004, $10, $20, and $50 bills received a redesign with several changes to their overall look, notably the addition of more colors (see the picture of the $50 bill above). Probably the most important new security feature is the addition of EURion Constellations, a distinct arrangement of symbols (in this case, numbers) which triggers many color photocopiers to refuse to copy the bill.

SUPER LABELS=SUPER DOLLARS

What I have just described is a “layered” approach in anticounterfeiting. You may not be the government fighting “super dollars,” but then again, you are fighting to protect your brand from counterfeiters. The money a brand owner saves in brand protection and litigation should be considered as “super dollars” to the brand owner. In the process (of saving money), the brand owner will be protecting the public, and he can advertise as such.

PUTTING IT INTO PRACTICE
Here’s how forensic authentication works in a M&R layered approach:
A unique digital code, “ATL 12-IDGJ”, is set-up for a brand.
A digital code is incorporated into the label through multiple-entry points (inks, varnishes, adhesives).
The digital code is also incorporated into (or linked to) the pedigree documentation.
A scanner will indicate that “ATL 12-IDGJ” is the established digital code, allowing traceability.

Such uniqueness cannot be duplicated because the invisible, nondegradable forensic digital code is virtually impossible for the counterfeiters to duplicate. It only takes a second to authenticate a product anywhere in the world.


Today, FDA does not need to know what type of anticounterfeiting measures you are taking. In fact, to protect themselves, brand owners should limit such details to a certain number of trained individuals who are monitoring what features are being used and for how long.
Most important in the anticounterfeiting arsenal is the brand owner’s mindset. Nothing changes until this does. Counterfeiters have the mindset that they can break the laws, provide fake or diluted products, and they do not care if they place the public in harms way. We (you and I) have to assume the mindset that says to the counterfeit, “No, you can’t copy my products.”

Thank you for your time. Donald J. Dobert, President, ATL.


March 10th, 2010

Bad Malaria Pills Raise Drug Resistance Fears.

10-Country Study In Africa Finds High Rates Of Poor Quality Medicine.

Story Courtesy of The Associated Press and MSNBC.com

High rates of the most effective type of malaria-fighting drugs sold in three African countries are poor quality – including nearly half the pills sampled in Senegal – raising fears of increased drug resistance that could wipe out the last weapon left to battle a disease that kills 1 million people each year, according to a U.S. report released Monday.

Between 16 percent and 40 percent of artemisinin-based drugs sold in Senegal, Madagascar and Uganda failed quality testing, including having impurities or not containing enough active ingredient, the survey found.

Artemisinin-based drugs are the only affordable treatment for malaria left in the global medicine cabinet. Other drugs have already lost effectiveness due to resistance, which builds when not enough medicine is taken to kill all of the mosquito-transmitted parasites.

Mosquito

If artemisinin-based drugs stop working, there is no good replacement and experts worry many people could die.

“It is worrisome that almost all of the poor-quality data that was obtained was a result of inadequate amounts of active (ingredients) or the presence of impurities in the product,” said Patrick Lukulay, director of a nongovernmental U.S. Pharmacopeia program funded by the U.S. government, which conducted the survey. “This is a disturbing trend that came to light.”

The study is the first part of a 10-country examination of antimalarials in Africa by the U.S. and the World Health Organization. It follows evidence from the Thai-Cambodian border that artemisinin-based drugs there are taking longer to cure malaria patients, the first sign of drug resistance.

The three-country report also found bad drugs in both the public and private health sectors, meaning governments – some buying medicines with donor funds – are not doing enough to keep poor-quality pills out. All of the drugs tested from the public sector in Uganda, however, passed the quality tests. But 40 percent of the artemisinin-based drugs in Senegal failed.

“There are countries where donated medicines are not subjected to quality controls, they’re just accepted,” said Lukulay. “There are countries in Africa where Chinese products have been donated and found to be unacceptable later in the public sector.”

‘A wake-up call’

A total of 444 samples of artemisinin-based combination drugs along with the antimalarial sulfadoxine-pyrimethamine – to which resistance has already developed – were first screened locally using visual inspection and basic lab tests. Sulfadoxine-pyrimethamine is still used, mainly for preventative treatment for pregnant women .

Nearly 200 samples then underwent full quality control testing in a U.S. laboratory to examine the amount of active ingredient present and drug purity. For both drugs, 44 percent from Senegal failed the full quality testing, followed by 30 percent from Madagascar and 26 percent from Uganda.

While the study is not the first to assess the quality of antimalarials in Africa, it is the most rigorous and complete. Similar failure rates were found in previous work, but those did not focus specifically on artemisinin-based drugs.

“I am alarmed by these results because it means there are many cases of malaria that are being only partially treated, and that just guarantees acceleration of artemisinin drug resistance,” said Rachel Nugent, deputy director for Global Health at the Center for Global Development, a U.S. think tank. “It is the most comprehensive study out there on antimalarials and should be a wake-up call.”

Nugent was not involved in the study.

In all three countries, the antimalarial brands collected from various areas and sectors tended to either do well across the board or poorly, which could prove helpful for governments working to ban low-grade drugs.

Results from the other countries surveyed – Cameroon, Ethiopia, Ghana, Kenya, Malawi, Nigeria and Tanzania – have not yet been publicly released by the WHO. But Clive Ondari, who worked on the study for the WHO in Geneva, said failure rates in three of those countries were also significantly high.

Ghana has already withdrawn more than 20 drugs from the market after receiving the initial results, Lukulay said.

Digest Break. Today’s quote to make you think: “If we ever forget that we’re one Nation under God, then we will be a Nation gone under.” — Ronald Reagan


February 4th, 2010

You Bet Your Life – Part I. Fake Pharmaceuticals.

FDA Warns Consumers about Counterfeit Drugs from Multiple Internet Sellers

If you purchase medications from sources that you do not know, and the product you take is purchased on the sole basis of “price”, then I believe you are playing a dangerous game of “you bet your life”.

The Food and Drug Administration (FDA) is cautioning U.S. consumers about dangers associated with buying prescription drugs over the Internet. This alert is being issued based on information the agency received showing that 24 apparently related Web sites may be involved in the distribution of counterfeit prescription drugs.
On three occasions during recent months, FDA received information that counterfeit versions of Xenical 120 mg capsules, a drug manufactured by Hoffmann-La Roche Inc. (Roche), were obtained by three consumers from two different Web sites. Xenical is an FDA-approved drug used to help obese individuals who meet certain weight and height requirements lose weight and maintain weight loss.

Above photos: Counterfeit Xenical, complete with instruction sheet, blister pack with exp. date, and lot serial numbers. What’s missing? ATL’s security labeling/ packaging: This is an invisible (non-degradable) digital forensic code that cannot be duplicated by the counterfeiters.

Photos below: If your prescription medications are not authenticated as genuine, how do you know that (your prescription medications) were not produced (by counterfeiters) on equipment such as this?

None of the capsules ordered off the Web sites contained orlistat, the active ingredient in authentic Xenical. In fact, laboratory analysis conducted by Roche and submitted to the FDA confirmed that one capsule contained sibutramine, which is the active ingredient in Meridia, an FDA-approved prescription drug manufactured by Abbott Laboratories.
While this product is also used to help people lose weight and maintain that loss, it should not be used in certain patient populations and therefore is not a substitute for other weight loss products. In addition the drug interactions profile is different between Xenical and sibutramine, as is the dosing frequency; sibutramine is administered once daily while Xenical is dosed three times a day.

Other samples of drug product obtained from two of the Internet orders were composed of only talc and starch. According to Roche, these two samples displayed a valid Roche lot number of B2306.
Roche identified the two Web sites involved in this incident as brandpills.com and pillspharm.com. Further investigation by FDA disclosed that these Web sites are two of 24 Web sites that appear on the pharmacycall365.com home page under the “Our Websites” heading. Four of these Web sites previously have been identified by FDA’s Office of Criminal Investigations as being associated with the distribution of counterfeit Tamiflu and counterfeit Cialis.

At this point, it appears that these Web sites are operated from outside of the United States. Consumers should be wary, if there is no way to contact the Web site pharmacy by phone, if prices are dramatically lower than the competition, or if no prescription from your doctor is required. As a result, FDA strongly cautions consumers about purchasing drugs from any of these Web sites which may be involved in the distribution of counterfeit drugs and reiterates previous public warnings about buying prescription drugs online. Consumers are urged to review the FDA Web page at www.fda.gov/buyonline/ for additional information prior to making purchases of prescription drugs over the Internet.
The 24 Web sites appear on pharmacycall365.com.
AllPills.net
Pharmacy-4U.net
DirectMedsMall.com
Brandpills.comEmediline.com
RX-ed.com
RXePharm.com
Pharmacea.org
PillsPharm.com
MensHealthDrugs.net
BigXplus.net
MediClub.md
InterTab.de
Pillenpharm.com
Bigger-X.com
PillsLand.com
EZMEDZ.com
UnitedMedicals.com
Best-Medz.com
USAPillsrx.net
USAMedz.com
BluePills-Rx.com
Genericpharmacy.us
I-Kusuri.jp

If you are a brand owner, ATL can show you how to authenticate your products in the field. If you are a consumer, we suggest that you purchase only authenticated prescription drugs from reliable sources.

We thank the FDA for materials used in this article.


February 3rd, 2010

You Bet Your Life – Part II. Dangerous (Fake) Pharmaceuticals. A Lesson For You In Loss Prevention.

You Bet Your Life: The Fakes. A Lesson For You In Loss Prevention.
A counterfeit drug or a counterfeit medicine is a medication or pharmaceutical product which is produced and sold with the intent to deceptively represent its origin, authenticity or effectiveness. For legal drugs, a counterfeit drug may be one which does not contain active ingredients, contains an insufficient quantity of active ingredients, or contains entirely incorrect active ingredients (which may or may not be harmful), and which is typically sold with inaccurate, incorrect, or fake packaging. Fake medicines and generic drugs which are deliberately mislabeled in order to deceive consumers are therefore counterfeit, while a drug which has not received regulatory approval is not necessarily so. Counterfeit drugs are also related to Pharma Fraud.

Most illegal drugs are produced and sold with the intent to deceptively represent its origin, authenticity or effectiveness, at least to some degree. The counterfeiting ranges from drugs which do not contain any active ingredients (e.g., when a bag of lactose is sold as cocaine), to cases where the active ingredients are “cut” with a dilutant or “spiked” with a chemical “enhancer”, to cases where the actual active ingredients differ from the purported active ingredients (e.g., when methamphetamine is sold as cocaine).

You Bet Your Life: Brand Piracy. Prescription and over-the-counter drugs.

Counterfeit legal drugs include falsely-labeled drugs that were previously expired, drugs where the active ingredient is fraudulently diluted, adulterated, substituted, completely misrepresented, or sold with a false brand name. An individual who uses a low quality counterfeit medication may experience a number of dangerous consequences to their health, such as unexpected side effects, allergic reactions, or a worsening of their medical condition. A number of counterfeits do not contain any active ingredients, and instead contain inert substances, which do not provide the patient any treatment benefits. Counterfeit medications may also contain incorrect ingredients, improper dosages of the correct ingredients, or they may contain hazardous ingredients.

The extent of the problem of counterfeit drugs is unknown. Counterfeiting is difficult to detect, investigate, and quantify. What is known is that they occur worldwide and are said to be more prevalent in some developing countries with weak regulatory regimes. It is sometimes estimated that upwards of 10% of drugs worldwide are counterfeit, and in some countries more than 50% of the drug supply is made up of counterfeit drugs. In 2003, the World Health Organization cited estimates that the annual earnings of counterfeit drugs were over $32 billion (US).

The high prices of patented medicines and the great divergence between manufacturing costs and prices are seen as important incentives for counterfeiting, including cases of high quality counterfeiting which can be difficult to detect. Fake antibiotics with a low concentration of the active ingredients can do damage world wide. Courses of antibiotics that are not seen through to completion allow bacteria to regroup and develop resistance.

Above Photo: Which are real and which are fake? Without traceability and authentication, how do you know? Would “You Bet Your Life” on not knowing?

You Bet Your Life: Some Solutions (RFID & Mass Serialization).

There are several technologies that may prove helpful in combating this problem, such as radio frequency identification (RFID). These are electronic devices to track and identify items, such as pharmaceutical products, by assigning individual serial numbers to the containers holding each product. The FDA is working towards an Electronic pedigree (ePedigree) system to track drugs from factory to pharmacy. This technology may prevent the diversion or counterfeiting of drugs by allowing wholesalers and pharmacists to determine the identity and dosage of individual products. Some techniques, such as spectroscopy and Energy Dispersive X-Ray Diffraction (EDXRD) can be used to discover counterfeit drugs while still inside their packaging.Some of the proposed anti-counterfeiting measures present concerns regarding privacy, or the possibility that drug manufactures will seek to use anti-counterfeiting technologies to undermine legitimate parallel trade in medicines. The term “counterfeit” should not be applied to generic drugs that are legally manufactured and sold, and which do not have deceptive labeling concerning the product. According to BBC reports, many of the fake drugs came from the same countries that make normal drugs, especially China and India. In the case of India, while it is against the law to sell fake drugs for domestic use, there is no regulatory regime that applies to the export market.

Graph Above: The top 5 anti-counterfeiting techniques are date codes, various printing, tamper evident, UPC codes, and mass serialization.

China
Many counterfeit drugs sold in the Third World or on the Internet originate in China. The State Food and Drug Administration is not responsible for regulating pharmaceutical ingredients manufactured and exported by chemical companies. This regulatory hole, which has resulted in considerable international news coverage unfavorable to China, has been known for a decade, but failure of Chinese regulatory agencies to cooperate has prevented effective regulation.
The Chinese press agency Xinhua reported that the World Health Organization had established Rapid Alert System (RAS), the world’s first web-based system for tracking the activities of drug counterfeiters, in light of the increasing severity of the problem of counterfeit drugs.

Russia
A few years ago, the Coalition for Intellectual Property Rights, an independent Russian group, conducted a survey that found that 12 percent of the prescription drugs distributed in Russia were counterfeit.

India
According to a report released by the Organization for Economic Co-operation and Development (OECD), 75 per cent of fake drugs supplied world over have some origins in India, followed by 7 per cent from Egypt and 6 per cent from China. It must be noted that India also is a leading source of high quality drugs sold by legitimate drug manufacturers, including most leading brand name drug makers operating in the US and Europe.

United States
The United States has had a growing problem with counterfeit drugs, and to help address it, the U.S. Food and Drug Administration (FDA) holds regular hearings to review trends and problems. The U.S. is an especially attractive market for counterfeiters because 40 percent of worldwide annual prescription drug sales were sold in the United States in 2007.

You Bet You Life: Anti-Counterfeit Platforms.
In 2007, the world’s first free to access anti-counterfeit platform was established in the West African country of Ghana. The platform relies on existing GSM networks in that country to provide pharmaceutical consumers and patients with the means to verify whether their purchased medicines are from the original source through a free two-way SMS message, provided the manufacturer of the relevant medication has subscribed to a special scheme. Still in trial stages, the implementers of the platform announced recently that they are in partnership with Ghana’s Ministry of Health and the country’s specialized agency responsible for drug safety, the FDB (Food & Drugs Board), to move the platform from pilot to full-deployment stage.

An Epedigree is another important system for the automatic detection of counterfeit drugs.

Photo Above: Hard copy of typical pedigree papers.

Photo Above: Pedigree papers can provide traceability of your prescription medications.

States such as California are increasingly requiring pharmaceutical companies to generate and store ePedigrees for each product they handle. On January 5th, 2007 EPCglobal ratified the Pedigree Standard as an international standard that specifies an XML description of the life history of a product across an arbitrarily complex supply chain.

You Bet Your Life: Illegal Drugs.
Illegal drugs can be counterfeited easily because the illegal drug market is an unregulated underground economy that rarely adheres to quality norms or safety standards. While there are some isolated examples of illegal drugs being sold under “brand names” that indicated that certain standards or dosage levels were being adhered to, this is the exception. The illegal “brands” can also be counterfeited by drug dealers who want to be able to sell their product at a higher price.
The use of dilutants in illegal drugs reduces the quality and potency of the drugs, and makes it hard for users to determine the appropriate dosage level. Dilutants include “foodstuffs (flour and baby milk formula), sugars (glucose, lactose, maltose, and mannitol), and inorganic materials such as powder.” The type of dilutants that are used often depend on the way that the drug purchasers will typically consume the drug in a given part of the illegal market. Dr. Hirsch, the New York Medical Examiner, claimed that buying illegal drugs is “… like playing Russian roulette.”

This is why we say that if you take prescription medications without “drug authentication”, you are playing a dangerous game of “You Bet Your Life“.

End.

Below: Article break. Are prices “sky high”?



February 1st, 2010

FDA Requests $4.03 Billion To Protect Public Health.

FDA NEWS RELEASE

For Immediate Release: February 1, 2010

The FDA Requests $4.03 Billion to Transform Food Safety System, Invest in Medical Product Safety, Regulatory Science. FY 2011 request represents a 23 percent increase over FY 2010 budget

The U.S. Food and Drug Administration is requesting $4.03 billion to promote and protect public health as part of the President’s fiscal year 2011 budget a 23 percent increase over the agency’s current $3.28 billion budget. The FY 2011 request, which covers the period of Oct.1, 2010, through Sept. 30, 2011, includes increases of $146 million in budget authority and $601 million in industry user fees.

“The FY 2011 resources will strengthen our ability to act as a strong and smart regulator, protecting Americans through every stage of life, many times each day,” said FDA Commissioner Margaret A. Hamburg, M.D. “This budget supports the ability for patients and families to realize the benefits of science that are yielding revolutionary advances in the life and biomedical sciences.”

The budget request reflects the FDA’s resolve to transform food safety practices, improve medical product safety, protect patients and modernize FDA regulatory science to advance public health. Funding in the FY 2011 request also supports new regulatory authority to regulate cigarettes and other tobacco products received in June 2009. The proposed budget includes support for the FDA’s investment in addressing the challenges of the 21st century. The FDA envisions a transformed U.S. food safety system that focuses on prevention, increased efforts to address medical product safety challenges and a focus on modernizing regulatory science at the FDA.

These four initiatives are the major highlights for the FY2011 budget increases.

* Transforming Food Safety (+ $318.3 million)

The Transforming Food Safety Initiative reflects President Obama’s vision of a new food safety system to protect the American public. The FDA will set standards for safety, expand laboratory capacity, pilot track and trace technology, strengthen its import safety program, improve data collection and risk analysis and begin to establish an integrated national food safety system with strengthened inspection and response capacity.

* Protecting Patients (+ $100.8 million)

The Protecting Patients Initiative advances the Obama Administration’s priorities for safe, quality health care for all Americans. The resources in this initiative will support the safety of drugs, devices, and vaccines, as well as the Nation’s blood supply. The FY 2011 resources will also strengthen the FDA’s ability to act as a strong and smart regulator to address medical product safety challenges in the years ahead.

* Advancing Regulatory Science (+ $25.0 million)

Advancing Regulatory Science builds on President Obama’s commitment to harness the power of science for America’s benefit. During the past two decades, extraordinary investments have led to revolutionary advances in the life and biomedical sciences. Many key discoveries, however, have yet to translate into real therapies for patients. The FY 2011 budget will allow the FDA to begin to strengthen its core scientific capacity. This investment will allow the FDA to identify improved pathways to product development and approval for new technologies that offer promising new opportunities to diagnose, treat, cure and prevent disease.

* Tobacco (+ $215.0 million)

An increase in tobacco user fees will allow the FDA to continue to implement the Family Smoking Prevention and Tobacco Control Act. Preventing youth from using tobacco and helping Americans quit, promoting public understanding of the harmful constituents of tobacco products, developing the foundation of science for regulating tobacco, and regulating tobacco to reduce the toll of tobacco-related disease, disability and mortality are tobacco program priorities for FY 2011.


February 1st, 2010

Fools Rush In Where Angels Dare To Tread: Anti-Counterfeiting Measures Require Patience And Wisdom. Donfucius’ Presents A Modern Day “Ten”.

Counterfeiting stinks! Anti-counterfeiting takes patience and wisdom.

Point Number 1: Counterfeiters are perfectly willing to eat a legitimate brand owner’s lunch. Anti-Counterfeiting measures take patience and wisdom. Just as “shoplifting is stealing”, counterfeiting is not a victimless crime, “it can be (and is) murder”. — Donfucius

Point Number 2: “Diplomacy is the art of saying “Nice doggie” until you can find a rock.” — Will Rogers

Point Number 3: “My father said there were two kinds of people in the world: givers and takers. The takers may eat better, but the givers sleep better.” — Marlo Thomas

Counterfeiters Are Copy-Cats.

Counterfeiters are copycats.

Point Number 4: “No matter how much cats fight, there always seem to be plenty of kittens.” — Abraham Lincoln

We, as a nation, must take positive action against the counterfeiters.

Point Number 5: “Don’t talk about what you have done or what you are going to do. Do you want to know who you are? Don’t ask. Act! Action will delineate and define you.”
Thomas Jefferson

Point Number 6: “First ask yourself: What is the worst that can happen? Then prepare to accept it. Then proceed to improve on the worst.” — Dale Carnegie

Tough Laws are needed to fast track anti-counterfeiting systems, and stiff fines and jail terms are necessary for those that place the public at risk.

Point Number 7: “I have wondered at times what the Ten Commandments would have looked like if Moses had run them through the US Congress.” — Ronald Reagan

Counterfeiting requires tough measures. We're not in Mayberry any more.

Above: Anti-Counterfeiting measures require tough and decisive actions. We’re not in Mayberry anymore.

Point Number 8: “Wise are those who learn that the bottom line doesn’t always have to be their top priority.” — William A. Ward

The counterfeiting problem is not insurmountable.

Point Number 9: “Don’t let the fear of the time it will take to accomplish something stand in the way of your doing it. The time will pass anyway; we might just as well put that passing time to the best possible use.” — Earl Nightingale

The only thing we have to fear is not doing anything.

Point Number 10: “You never change the existing reality by fighting it. Instead, create a new model that makes the old one obsolete.” — R. Buckminster Fuller

Mindsets. Counterfeiters have the mindset that they can break the laws, provide fake or diluted products, and they do not care if they place the public in harms way. We (you and I) have to have the mindset that says, “No, you can’t do this“. — Donfucius


January 25th, 2010

FDA Says Fake Forms Of Glaxo Diet Drug Can Be Dangerous.

By Lisa Richwine Mon Jan 25, 2010

WASHINGTON (Reuters) Fake versions of GlaxoSmithKline’s over-the-counter diet pill were contaminated with dangerously high levels of a prescription weight loss ingredient, U.S. officials warned on Saturday.

alli_pills

Lab tests showed counterfeit versions of Glaxo’s pill Alli contained high levels of sibutramine, Food and Drug Administration officials said.

Sibutramine is the active ingredient in Abbott Laboratories Inc’s prescription diet drug Meridia.

“The amount of sibutramine in the counterfeit Alli poses a serious health risk to some individuals,” Dr. Janet Woodcock, head of the FDA’s drug unit, told reporters on a conference call.

“A person taking the counterfeit Alli as directed would be exposed to twice the maximum prescription dose of sibutramine every day,” she said.

The FDA warned earlier this week that sibutramine should not be used by people with a history of cardiovascular disease because it can raise the risk of heart attacks and strokes.

Regulators in Europe concluded sibutramine was too risky and Abbott agreed to suspend sales there.

Woodcock said even healthy people exposed to the counterfeit Alli pills could experience effects including palpitations, sleepiness, anxiety, nausea and slightly elevated blood pressure.

The fake versions were sold on the Internet, including through online auction sites, FDA officials said. There is no evidence of counterfeit versions in stores, they said.

The fake products were sold as 60-milligram, 120-count refill packages only, Glaxo said. The company said it was working with the FDA to have the counterfeits removed from online auction sites.

The agency urged all consumers taking Alli to check they had bought legitimate versions and discard any fake products immediately.

The fake versions have some differences on the packaging, including a missing lot code on the outer cardboard packaging. The FDA posted links to photographs of Glaxo’s approved versions and the counterfeits here.


January 25th, 2010

FDA Commonly Asked Questions And Answers. Actual Examples Of Counterfeited Prescription Drugs.

Today’s Topics – FDA Q&A. Counterfeit Prescription Drugs.
In the fight against counterfeited prescription medicines, don’t bury your head in the sand. Expect the unexpected. Listen for evil, look for evil, and blow the whistle when you encounter evil.

FDA Questions And Answers. Q. What is the definition of a counterfeit drug? A. U.S. law defines counterfeit drugs as those sold under a product name without proper authorization. Counterfeiting can apply to both brand name and generic products, where the identity of the source is mislabeled in a way that suggests that it is the authentic approved product. Counterfeit products may include products without the active ingredient, with an insufficient or excessive quantity of the active ingredient, with the wrong active ingredient, or with fake packaging.

Donfucius Note: As they dilute or divert legitimate products, counterfeiters also make false and wild claims. In the illustration below, would you rather go camping at a three star campground, five star campground, or fourteen-star campground? There is an old phrase that says: “Let the buyer beware”. In most cases, you will get what you pay for: “The bitter taste of poor quality lingers long after the sweet taste of price has evaporated” (Donfucius).

Q. What risks are involved with taking counterfeit drugs?
A. An individual who receives a counterfeit drug may be at risk for a number of dangerous health consequences. Patients may experience unexpected side effects, allergic reactions, or a worsening of their medical condition. A number of counterfeit products do not contain any active ingredients, and instead contain inert substances, which do not provide the patient any treatment benefit. Counterfeit drugs may also contain incorrect ingredients, improper dosages of the correct ingredients, or they may contain hazardous ingredients.

Q. What can consumers do to protect themselves from counterfeit drugs?
A. Consumers can protect themselves from the risks associated with counterfeit drugs by purchasing prescription medications from state-licensed pharmacies in the U.S. Consumers must be vigilant when examining their personal medications, paying attention to the presence of altered or unsealed containers or changes in the packaging of the product. Differences in the physical appearance of the product, taste, and unexpected side effects experienced should alert the patient to contact their physician, pharmacist, or other healthcare professional who is providing treatment.

Donfucius Note: Ortho Biotech Products issued a warning to health care professionals about the existence of counterfeit vials of its anti-anemia drug Procrit. The concentration of the active ingredient was 20 times lower than what was listed on the label. The two photos (below) show the boxes of the authentic (top) and counterfeit (bottom) product. The counterfeit boxes could be identified by the text running off of the right side of the box. The average consumer would probably not notice this. ATL Pharma Security Label Systems is cGMP compliant. We operate under the strict regulations of 21 CFR 210 and 211. This means we must hold tight registration for both commercial pharmaceutical labels and clinical trials. It is our suggestion that you always buy your brands from reputable companies with anti-counterfeiting protection.


Q. How does FDA work with domestic and foreign government agencies to combat counterfeits?
A. FDA is currently working with various U.S. government agencies, such as the Department of Homeland Security (Customs and Border Protection) and the Department of Justice, to combat counterfeit drugs. FDA is also very active in WHO’s International Medical Products Anti-counterfeiting Task Force (IMPACT) which is a public/private effort to develop regulatory, legislative, enforcement, communication, and technological tools to combat counterfeit drugs around the world. FDA also works bilaterally and multilaterally with individual countries and regions.

Q. Are there any promising technologies that have the capability of preventing counterfeiting?
A. There are several technologies that may prove helpful, including radio frequency identification (RFID) chips and taggants. For example, radio waves are used to automatically read RFID tags that are contained on items, such as pharmaceutical products. These tags could have individual serial numbers on each product, thus allowing the product to be tracked and traced through the supply chain. Appropriate implementation and use of this technology can help decrease the opportunities for diversion and counterfeiting by allowing wholesale distributors and pharmacies to authenticate that the product was handled by legitimate, licensed entities in the drug supply chain.

The fight against counterfeited drugs. Below are two photographs of counterfeited drugs. The average consumer will have a very difficult time telling apart the real from the fakes.

You (as a brand owner or as a consumer) must be able to rely on the labeling/ packaging integrity to identify (thus stop) counterfeiting. ATL has nine trademarked products that provide a mix and rotate (M&R) approach (during sequential production runs) for anti-counterfeiting protection. These include: SecurLock: Tamper-Evident breakaway closure; SecurDetek: Invisible, Hidden Page Marker; SecurMark: Anti-Counterfeiting holograms; SecurStretch: Tamper-Evident Unit Closure; SecurPly: Booklets for soft squeeze tubes; PharmaVoid: Security Closure/ Destructible Tapes; Triple-Ply: Three-Tier overt and / or covert levels of anti-counterfeiting; D2 WAO: Wrap-Around style (up to 35 panels) that fit most cylinders – (U.S. Patent Applied For). Below is an example of ATL’s SecueDetek. This label features an invisible, non-degradable (to 3,000 degrees centigrade) digital forensic code. With this system you can authenticate (anywhere in the world) in one second.

Thus far, the counterfeiting targets discovered in the United States have been largely the popular and expensive “high-value pharmaceuticals”-cancer drugs, performance-enhancing growth hormones, drugs used to treat AIDS, and Viagra. In other parts of the world, however, anti-malaria drugs, antibiotics, and even common analgesics have become counterfeiting targets.
According to the international police agency Interpol, at least 5% of the world pharmaceutical trade involves counterfeit drugs, and up to 60% of medicines in the developing world may be counterfeit. Not only has this cost the drug industry more than $12 billion annually, but it has also resulted in an untold number of deaths. This vulnerability was illustrated when 109 Nigerian children died after taking counterfeit paracetamol (acetaminophen) syrup.

Although many-if not most-counterfeit drugs are manufactured and distributed in India, China, Brazil, South Africa, and Russia, they are poised to make their way to the U.S. market. That is because they are increasingly turning up at pharmacies in Mexico and other intermediary countries and through difficult-to-trace online pharmacies. As a growing number of Americans attempt to save money by purchasing their medication in Canada, Mexico, and other foreign countries or through the Internet, the number of counterfeit or adulterated drugs making their way into the U.S. market is potentially staggering.

ATL strongly suggests that you protect your brands. In so doing you will be protecting the public. Coach Pat Riley said it best: “There’s no such thing as coulda, shoulda, or woulda. If you shoulda and coulda, you woulda done it.”


January 24th, 2010

Recent Counterfeiters And Their Illicit Deeds – Leonardo DiCaprio In “Catch Me If You Can!”

I am amazed when people look at a problem and choose to do nothing. It is very similar to talking about the heavens and stars. Why is it that when you tell a person that there are 400 billion stars in the sky – he will believe you? But tell this same person a bench is wet and he will have to touch it. The same holds true for counterfeiting. Most people know it’s a big problem, yet most people stay in denial, hoping the problem will not affect them (when in reality it already has). To help give you a perspective on the huge scope of the counterfeiting problem, I have chosen to tell you five stories about counterfeiters:

Counterfeiting History – Part 1: Frank William Abagnale Jr worked under 8 identities during the 1960s, including his first as Pan American Airlines Pilot Frank Williams. In 5 years, he passed over $2.5 million in counterfeit checks. This fraud was in 26 countries and all 50 states. He was arrested in France at an Air France ticket counter when an agent recognized his face from a wanted poster. In the movie based on his life, “Catch Me if You Can”, the real Abagnale made a cameo appearance as a French policeman (photo above). Leonardo DiCaprio and Tom Hanks were the stars.

Counterfeiting History – Part 2: Anatasios Arnaouti is a criminal from Manchester who led one of the most ambitious forgery operations in history. He and his accomplices were jailed in 2005. The total amount of counterfeit money they printed is unknown as their forgery operation had been in production for several years, and was capable of producing tens of thousands of counterfeit notes each day. The extent of the crime was considered so severe that it could have driven the United States and UK economies into panic.

Counterfeiting History – Part 3: In 2004, French police seized fake 10 euro and 20 euro counterfeit bank notes worth a total of around 1.8 million (pounds) from two laboratories and estimated that 145,000 counterfeit notes had already entered circulation.

Counterfeiting History – Part 4: In 2006, a Pakistani government printing press in the city of Quetta was accused of mass producing huge quantities of counterfeit Indian bank notes. The “Times of India” reported this scandal, based on Central Bureau of Intelligence investigation. The money was allegedly used to fund terrorist activities inside India. It is believed that bombings in Mumbai were funded using this fake currency.

Counterfeiting History – Part 5: Today the (hardest to detect) counterfeit notes are claimed to be US dollar bills produced in North Korea, called “Super Dollars” because of their high quality. The US government believes they have been circulating since the late 1980s and that they serve two purposes: as a source of income and to undermine the US economy. The United States has taken steps to “Mix & Rotate” the production of dollars. For more details, please reference “The President’s Corner” from October 7th, 2008.

How To Fight Back
Detecting counterfeit bills often isn’t easy by eye. A bogus $100 bill (believed to have been made in North Korea), would be nearly impossible for a novice to identify as a fake. The paper it is printed on contains no starch and doesn’t reflect ultraviolet light, which is one sign of a counterfeit. It has the security strip on the left side of the bill and a watermark of Ben Franklin (whose portrait is on the bill) on the right-hand side, as well as replicating other security features.

There is now a scanner that searches for missing covert features in bogus “Super Dollars”. The device looks at several aspects of the bill to confirm its legitimacy. U.S. paper money is printed with magnetic ink, but that’s also used for many fraudulent bills. On real bills the ink is distributed in a consistent pattern whose magnetic resonance can be mapped. The magnetic map is stored in the scanner, as well as three other maps containing ultraviolet, infrared and other measurements taken from legitimate bills. Scanning a bill takes less than one second. If there’s any spike, any anomaly in any of the threads of data, the scanner rejects the dollar.

What I have just described is a “Layered” approach in anti-counterfeiting. You may not be the government fighting “super dollars”, but then again, you are fighting to protect your brand from counterfeiters. The money you save in brand protection and litigation should be considered as “super dollars” to you. In the process (of saving money) you will be protecting the public.

Here How Forensic Authentication Works: (1) A unique digital code, “ATL 12-IDGJ”, is set-up for your brand; (2) Your digital code is incorporated into the label through multiple entry points (Inks, Varnishes, Adhesives) (This is a “mix and rotate” “layered” approach); (4) The digital code is also incorporated into (or linked to) the Pedigree Documentation; (5) If the scanner indicates “ATL 12-IDGJ” then the established digital code allows traceability; (6) This uniqueness cannot be duplicated; (7) Thus it is impossible to counterfeit.

It only takes a second to authenticate your product anywhere in the world (scanner photo above). This is because the invisible, non-degradable forensic digital code is virtually impossible for the counterfeiters to duplicate. This amazing technology is from ID Global, the leader in scientific identification.

Counterfeiters are attacking us on all fronts. Protect yourself and your brand. Benjamin Franklin said it best: “Even a tiny leak can sink a great ship.”


January 23rd, 2010

“To Counterfeit Is Death: Y2K+10 Version”. The Bucket Shops. How Counterfeiters Harm The Public.

What is a Y2K+10 (year 2010) bucket shop? How does a bucket shop affect the manufacturer of legitimate brands? Look at the two photos below, one of a counterfeiter’s equipment (the bucket shop), and one of a counterfeiters press (also a bucket shop). These facilities can be in a basement or garage, and are usually filthy.

If you are a regular visitor of “The President’s Corner”, then you know that counterfeiting has been around since the birth of our nation. Early United States currency had “To Counterfeit Is Death” printed on the notes. This was a serious crime in the years 1759 – 1777 (and beyond). But let me try and get you to think about a new paradigm: “To Counterfeit Is Death – Y2K+10 Version”. The counterfeiters of the new millennium (Y2K) really do kill people. Diluted vaccines, tainted baby formula, prescription drugs with very little (or no) active ingredients at all – these are the lowest of all possible crimes. The counterfeiters seldom see their victims. If they get caught, their fines are minuscule, no more than just a “slap on the wrist”. How do the criminals attack your legitimate products? And more importantly – how do you fight back?

Counterfeiters rip you off by reformulating (dilution or complete fakes) and re-packaging – the replacement of labels with copies. This is huge problem at all levels of the supply chain. Fraudulent labels are used to change the dates of expired product, make false claims or misrepresentations, and inflate pricing. (Pricing can be inflated because a 5 mg dose can be reprinted to claim a 40 mg dose). Quite often these (counterfeited) prescription drugs are administered to very weak cancer or aids patients, and the doctors think the drugs are not working because of the advanced state of the disease. Little do the doctors realize they may be giving their patients diluted or fake medicines. This is why I say “To Counterfeit Is Death”.

Brand Owners Can Fight Back. Tamper Evident Labels (ATL Secur-Lock or Pharma- Void) use substrates that effectively deter re-marking and counterfeiting fraud. This helps prevent a negative economic impact on your brand. The label face stock combines a tamper evident feature with covert authentication. Labels using this substrate are very difficult to remove (they destroy themselves when removed) . . . and can be easily distinguished from a fake.
When combined with ATL’s covert printing, tamper evident substrates can be your cornerstone of a highly protective labeling solution. Tamper evident substrates features include:
- Destructible, paper-based face stock
- Non-reproducible covert security fibers
- Distribution limited to approved secure suppliers

Tamper Evident Substrates Benefits
- Label cannot be removed without visible damage
- Effectively deters re-marking
- Assures product authenticity, or provides or provides simple in-field authentication
- Secure chain of custody
- Covert Authentication
- Tamper Evidence

Twelve Elements Of A secure Supply Chain/ Cold-Chain. Quality Management of the distribution channel begins and ends with the brand owner. Below is the first slide of a presentation I recently made to “Cold Chain Distribution Professionals” at the Philadelphia Convention Center.

I recommended a 12 step approach to strengthen their cold-chains (the logistical system of safely delivering their products). My advice to them is detailed in “The President’s Corner” published October 4th, 2008.
If you would like to discuss your anti-counterfeiting needs, please contact ATL for a no obligation conversation” about your supply chain. We feel that we have solid experience in anti-counterfeiting. I’ll say this over and over – our main focus is not that you buy something from ATL, rather that you learn from knowledgeable people about the perils of counterfeiting.

I will end this segment with the following words of wisdom: “Believe it is possible to solve your problem. Tremendous things happen to the believer. So believe the answer will come. It will.” — Norman Vincent Peale


January 22nd, 2010

U.S. Anti-Counterfeiting History – Recent Demoninations And “Layered” Covert Techniques.

Criminals around the world have found that they can maximize gain with relatively little capital outlay through product fraud. It could be pharmaceuticals, baby formula, toothpaste, brake pads, or toys. The more fraud that we allow to take place, the more patients will be put at risk for counterfeit medicines, or, the more chance that your children (or grand-children) will have toxic lead paint on their toys. The problem goes beyond violation of intellectual property rights. Counterfeiting is not a victimless crime. People die each day from unsafe counterfeited items. The problem is as old as mankind.

Early currency was plainly labeled “To Counterfeit Is Death”. The example below is a 4 Pound Note issued by Pennsylvania in 1777.

The theory behind such harsh punishments was that one who had the skills to counterfeit currency was considered a threat to the safety of the state, and had to be eliminated. Far more fortunate was an earlier practitioner of the same art, active in the time of the Emperor Justinian (527 A.D., mosaic shown below), who got the nickname “Alexander The Barber”. Rather than executing the counterfeiter when he was caught, the Emperor decided to employ his financial talents in the government’s own service.

Modern U.S. Currency has changed many times over the past few years:

With the exception of the one-dollar bill (above), all of these notes are obsolete. This is because the United States Government “Mixes & Rotates” (M&R) its overt and covert techniques to stay one step ahead of the counterfeiters. Shown below are examples of anti-counterfeiting “layered levels” of the “ever-changing” “face” of U.S. notes. You will notice the different colors when compared to the notes that are now obsolete:

Overt and Covert M&R (Mix And Rotate) anti-counterfeiting measures include fine detail with raised intaglio printing on bills. This allows non-experts to easily spot forgeries. As a side note, on coins, milled or reeded (marked with parallel grooves) edges are used to show that none of the valuable metal has been scraped off. This detects the shaving or clipping (paring off) of the rim of the coin. However, this does not detect sweating, or shaking coins in a bag and collecting the resulting dust. Since this technique removes a smaller amount, it is primarily used on the most valuable coins, such as gold.

For paper bills, in the late twentieth century advances in computer and photocopy technology made it possible for people without sophisticated training to easily copy currency. To combat this, national engraving bureaus began to include new (more sophisticated) anti-counterfeiting systems such as holograms, multi-colored bills, embedded devices such as strips, microprinting, and inks whose colors change depending on the angle of the light. New technology also includes the use of design features such as the “Eurion Constellation” which disables modern photocopiers.

This is very similar in concept to the “Canada Green” overprint on the U.S. 1862 note (used almost 150 years ago). The tint made it very difficult to photograph (complete story and photo are in the President’s Corner dated October 6th, 2008).

To protect your intellectual property, ATL recommends that you educate yourself about overt and covert anti-counterfeiting (anti-piracy) technologies. We also recommend that you take a long look in the mirror. You, as a brand owner, have the power to do the right things. You have the power to protect the public against diversion, dillution, and counterfeiting. By taking these extra steps you will find out something very surprising in the journey – you, in all likelihood, will be saving money in the process.

Bill Cosby said it best: “A word to the wise ain’t necessary – it’s the stupid ones that need the advice.”


January 21st, 2010

Benjamin Franklin’s Anti-Counterfeiting Secrets

Counterfeiting has been in existence since the dawn of civilization. Did you know “The United Colonies” had to deal with counterfeiters? This Four Dollar Bill (November 29th, 1775), printed in Philadelphia by “Hall and Sellers”, had an actual “leaf” in the design on the reverse side. This idea came from Benjamin Franklin. The uniqueness of the leaf made the currency very difficult to counterfeit. In this era, counterfeiting was considered so serious that it was punishable by death, and was so noted on some currencies. Today, as in 1775, counterfeiting is not a “victimless” crime.
Twenty Shilling Note, To Counterfeit is Death. (Philadelphia: Printed by Franklin and Hall, 1759). Paper money printed from ordinary type was easy to counterfeit, but Franklin ingeniously solved that problem by printing pictures of leaves on every piece of money. Counterfeiters could not duplicate or even imitate the fine lines and irregular patterns. In the Twenty Shilling note (shown below), the phrase “To Counterfeit Is Death” is printed directly above the leaf.
If you make something of value, everything from jeans to life-saving pharmaceuticals, counterfeiters are studying your supply (or cold) chain. They will strike where you are most vulnerable. For you to think that you are not at risk is to be in a state of denial.

A very wise man at Abbott Labs, Mike Douma, said: “Don’t be afraid to uncover things that you are not proud of when you look at your products and processes.”

ATL has many overt and covert techniques to provide you with a “layered approach” in brand protection. We strongly recommend a mix and rotate (M&R) approach. In this mode, manufacturers vary the size, location, and amount of anti-counterfeiting “layered” protection. In this manner you are a step ahead, and counterfeiters will be trying to catch up to you.

Article Break: Donfucius’ “Election Whimsy-A Collection…”
“If life were fair, Dan Quayle would be making a living asking ‘Do you want fries with that?’” — John Cleese


January 21st, 2010

U.S. Anti-Counterfeiting History: The 1861-1862 Notes

THE $1 LEGAL TENDER NOTE OF 1862

The face of the 1862 Legal Tender Note has the portrait of Salmon Portland Chase (1808-1873), secretary of the Treasury under Lincoln. Anti-counterfeiting features included two printers, the American and National Note Companies. The very distinctive signature on the front was that of F.E. Spinner. This dollar featured a patented “Canada Green” overprint controlled by ABNCo. (American Bank Note Company). The tint made the bill almost impossible to photograph, because the image would come out too dark.

This was in sharp contrast to CSA (Confederate States of America) currency. The CSA currency was usually plain, and could easily be counterfeited. To combat this, the CSA tried to “enhance” their bills by adding fine artwork.

Between the two notes shown, it would be harder to counterfeit the first note (above) (entitled “Navigation Seated”, year 1861), because the art design was more detailed than the second CSA note shown (below) (entitled “Columbia Capitol”, year 1862). The CSA notes were commonly hand signed and serialized when they were issued. This reduced the chances of fraud.

Article Break – Todays Donfucius quote of the day: “If a pig loses its voice, is it disgruntled?”


January 21st, 2010

Faking It. Nothing Phony About Profits In The Knockoff Business.

President’s notes: The IACC (International Anti-Counterfeiting Coalition) is an organization dedicated to fighting counterfeit goods. This article courtesy of Ambrose Clancy, Long Island Business News.

A couple of years ago a building inspector in North Hempstead was checking out a warehouse when he noticed something was wrong with the back gates. As he walked in to inform the owner about the problem, several Asian women bolted past him, piled into a van and sped off.

Faking It

Photo above. Fake goods. Bad quality and very bad for the economy. Why? Counterfeiters do not pay taxes, but you do.

Inside were boxes of Timberland boots. Well, the label said Timberland. Actually they were cheap knockoffs manufactured in China and smuggled into the Port of New York/New Jersey.

“They were moving thousands and thousands of boots out of there,” said Detective Sgt. Thomas Riley of the Nassau County Police Department.

Trademark counterfeiting is ” where a brand name is essentially stolen and slapped on a cheaper and vastly inferior copy”. This is big business. On Long Island, fakes are sold at nearly every flea market, in carwashes, delis, mom-and-pop stores and at kiosks in the malls. They change hands at shopping parties in people’s homes and from the trunks of cars by so-called “bag ladies.” These are not homeless women but crooks hawking what on first glance looks like a Louis Vuitton bag for a quarter of the price, but in reality is a inferior product, doomed to fall apart in six months.

Figures on the size of the counterfeit market are murky. More than $600 billion has been mentioned as the amount of cash generated by worldwide counterfeiting of apparel, luggage, handbags, sunglasses and other designer goods.

But Susan Scafidi, a law professor at Fordham University and an expert in intellectual property law, said all figures are suspect, since counterfeiters don’t file with the Internal Revenue Service.

“The $600 billion is a vague number taken from estimates that something like 7 percent of world trade is counterfeit,” said Scafidi, who also runs the up-to-the minute blog Counterfeit Chic, tracking the fashion industry’s battle against fakes.

Bob Barchiesi, president of the International Anti-Counterfeiting Coalition, had no problem with the $600 billion global figure, adding that the total for the United States is a quarter of a trillion dollars. Formed in 1979, the IACC works with investigators and law firms, lobbies politicians and gets the word out.

“This is a serious problem and not getting any better,” said Barchiesi.

Photo below. Counterfeits are a world wide problem, including fake baby formula. Hong Kong’s two biggest grocery chains removed all milk made by the leading Chinese dairy after traces of a chemical that killed and sickened babies was found in products in mainland China. (AP Photo/Kin Cheung)

Above: Logo Of Product Being Removed From Chinese Stores

Above: Logo Of Product Being Removed From Chinese Stores

The criminal enterprises began in the late 1960s when fashion designers figured out that copyright and patent laws don’t protect designs, Scafidi said. As a response, designers placed visible logos on garments and bags, in part because the logos were copyright protected, even if the designs were not.

But then the counterfeiters moved in, copying those logos in an effort to trick buyers into believing their wares were the real thing.

Fifteen years ago when China became a manufacturing powerhouse, the illegal trade boomed, said Barchiesi, who estimated that 85 percent of trademark counterfeiting comes from China.

The goods are moved in shipping containers, mislabeled from electrical equipment to actual clothing, Riley said. Some clever importers recently moved winter coats with a Chinese label and when the New York contact picked them up, the Chinese labels were peeled off to reveal a North Face logo, he added.

The classic crime success story is very low risk and very high reward. Trademark counterfeiting is all of that, said Barchiesi, adding that the illegal trade is safer and more profitable than importing heroin.

“The low risk is the judicial system doesn’t levy out significant penalties for this type of crime,” he said.

Trademark counterfeiting law in New York has two degrees of felony offense, with a second degree charged if more than $1,000 worth of merchandise is sold, according to Deputy Inspector James Burke, commanding officer of the Suffolk County Police Department’s District Attorney Squad.

“But the real rub is that a first-degree offense is only when $100,000 worth of illegal goods are sold,” Burke said. Stay below $100,000 and if you’re convicted, you can expect one to four years in jail. Cross the line and it’s five to 15.

Another low-risk factor for criminals is diminishing resources in law enforcement, Burke said. There is no trademark counterfeiting squad in any Long Island department. “Violent crime trumps trademark counterfeiting every time,” Burke added.

Law enforcement mainly works with companies, trade associations and private investigators to fight the fakes, he said.

Investigator Andrew Oberfeldt has been ferreting out counterfeiters on Long Island since 1991 for the Manhattan firm Abacus Security & Investigation. He works mainly on tips from jealous competitors.

“Informants are motivated by greed and envy,” Oberfeldt said.

He’s seen fake goods in beauty parlors, gas stations, small clothing and shoe stores. Bag ladies go to Manhattan’s Chinatown twice a month and load up on bogus handbags, he said. “They drive around the Island with stuff in their trunk and sell it where people work,” he added. If they know the receptionist at a doctor’s office, for example, they will drop by and hustle the bags in the waiting room.

It has become so commonplace that many people don’t consider it a crime. Oberfeldt had a friend in the Nassau County Police Department who was approached by a secretary at headquarters offering to sell designer clothes. He said, “Sure, lead the way,” the investigator said. “Out in the parking lot, he took one look at the stuff and locked her up.”

To those who say trademark counterfeiting is a victimless crime, all experts beg to differ. Not only do legitimate businesses suffer, but taxes are never paid on the goods sold. (Estimates on annual unpaid taxes approach $1 billion.)

Buying these goods supports violent criminals. Buying a knockoff pair of designer jeans also supports Third World sweatshops, where children labor for slave wages in appalling conditions.

Going for an illegal bargain can also be physically dangerous, Sgt. Riley said, referring to the brisk trade in fake electronics products.

“Buy a replacement cord for your coffee maker and if it’s counterfeit you’ve got a fire hazard,” he said.

game-boy-exploding

Photo above. Fake goods can hurt you. Here is an exploding counterfeit battery from a hand held video device. Cell phones are also at risk.

Another hazard could be related to knockoff Major League Baseball items. Jerseys and caps for adults and children are often processed with toxic chemicals and contain no flame-resistant elements.

According to MLB spokesman Matt Bourne, in the past five years organized baseball has seized more than four million pieces of counterfeit goods.

On a slow morning last week at the mammoth indoor Attitas Flea market in Sayville, Mets home jerseys were going for $35, more than half off the MLB price.

Genuine MLB merchandise is identified by a hologram attached either to the product or to a hang tag. Some jerseys at Attitas had the hologram, most did not. When someone brought the lack of holograms to the merchant’s attention, he said, “All I know is these are official.”

He then wasn’t interested in continuing the conversation.

zp-005-fake-and-real-hologram

Photo above. Fake and real hologram. Once a counterfeiter targets a product, a fake hologram can be made within 24 hours.

Rip-off artists

A crime related to counterfeiting trademarked goods is music piracy, which is swamping the recorded music industry. The Recording Industry Association of America said pirates cost the music industry $12.5 billion annually and that 71,000 jobs have been lost over the past five years. Thieves have also cost the government $422 million in unpaid taxes.

Although it’s a worldwide problem, there are homegrown illegal manufacturers as well, mostly involved in pirating music with CD “burner factories” set up in office parks on Long Island and funded in some instances by organized crime, said Bob Barchiesi, president of the International Anti-Counterfeiting Coalition.

The music pirates have made the music makers change strategies. Since 2003, music companies sued 35,000 individuals for copying music online. Last December, however, they waved the white flag.

This was a combination of ineffectiveness and disastrous public relations. The practice of suing teenagers and single moms came across as bullying.

Instead, the RIAA asked for help from the Internet service providers to stop music piracy and a preliminary agreement has been reached. When file sharing is discovered, RIAA will inform the provider and the provider will then tell the offending customer to stop. If the customer is unwilling to do so, the provider can then cut off access to the offender.


January 20th, 2010

Did You Ever Wonder…

Why the sun lightens our hair, but darkens our skin?

Why don’t you ever see the headline ‘Psychic Wins Lottery’?

Why ‘abbreviated’ is such a long word?

Why is it that doctors call what they do ‘practice’?

Why is lemon juice made with artificial flavor, and dish washing liquid made with real lemons?

Why is the man who invests all your money called a broker?

Why is the time of day with the slowest traffic called rush hour?

Why isn’t there mouse-flavored cat food?

Why didn’t Noah swat those two mosquitoes?

Why do they sterilize the needle for lethal injections?

Why they don’t make the WHOLE PLANE out of that stuff they use to make the indestructible ‘black box’?

Why don’t sheep shrink when it rains?

Why are they called apartments when they are all stuck together?

If con is the opposite of pro, is Congress the opposite of progress?

If flying is so safe, why do they call the airport the terminal?


January 11th, 2010

Mark Twain’s Uncommon Comments.

“If you tell the truth you don’t have to remember anything.”

“Drag your thoughts away from your troubles…by the ears, by the heels, or any other way you can manage it.”

“Don’t go around saying the world owes you a living; the world owes you nothing; it was here first.”

“You can’t depend on your eyes when your imagination is out of focus.”

“I’ve seen many troubles in my time, only half of which ever came true.”

“As to the Adjective; when in doubt, strike it out.”

“The best way to cheer yourself up is to try to cheer somebody else up.”

“The man with a new idea is a crank until the idea succeeds.”

“Always do right; this will gratify some people and astonish the rest.”

“Name the greatest of all the inventors. Accident.”

“A man’s character may be learned from the adjectives which he habitually uses in conversation.”


December 1st, 2009

Digest Break. A Collection Of Wit To Help Brighten Your Day.

“When you enter a room, you have to kiss his ring. I don’t mind, but he has it in his back pocket.” — Don Rickles on Frank Sinatra

“Nobody got anywhere in the world by simply being content.” — Louis L’Amour

“You know you’re getting old when you stoop to tie your shoelaces and wonder what else you could do while you’re down there.” — George Burns

“When they discover the center of the universe, a lot of people will be disappointed to discover they are not it.” — Bernard Bailey

“Freedom of the press is limited to those who own one.” — A.J. Liebling

“The higher the buildings, the lower the morals.” — Noel Coward

“We judge ourselves by what we feel capable of doing, while others judge us by what we have already done.” — Henry Wadsworth Longfellow

“By the time a man realizes that maybe his father was right, he usually has a son who thinks he’s wrong.” — Charles Wadsworth

“We are here on Earth to do good to others. What the others are here for, I don’t know.” — W.H. Auden

“Good judgment comes from experience, and experience comes from bad judgment.” — Barry LePatner

“A waist is a terrible thing to mind.” — Jane Caminos

“After two years in Washington, I often long for the realism and sincerity of Hollywood.” — Fred Thompson


August 16th, 2009

Digest Break. We Said It, Not You.

“The first half of our lives is ruined by our parents, and the second half by our children.” — Clarence Darrow

“Talent hits a target no one else can hit; Genius hits a target no one else can see.” — Doug Fischer

“I not only use all the brains that I have, but all that I can borrow.” — Woodrow Wilson

“There are two types of people – those who come into a room and say, Well, here I am! And those who come in and say, Ah, there you are.” — Frederick L Collins

“Think of what would happen to us in America if there were no humorists; life would be one long Congressional Record.” — Tom Masson


June 7th, 2009

Digest Break. We Said It, Not You…

“Why do we label underwear as a pair?” — Donfucius

“When I was born I was so surprised I didn’t talk for a year and a half.” — Gracie Allen

“Everywhere is walking distance if you have the time.” — Steven Wright

“I wonder if other dogs think poodles are members of a weird religious cult.” — Rita Rudner

“Don’t worry about people stealing an idea. If it’s original, you will have to ram it down their throats.” — Howard Aiken

“I bought a cactus. A week later it died. And I got depressed, because I thought, Darn, I am less nurturing than a desert.” — Demetri Martin

“The trouble with having an open mind, of course, is that people will insist on coming along and trying to put things in it.” — Terry Pratchett

“There is no such thing as fun for the whole family.” — Jerry Seinfeld

“We are inclined to believe those whom we do not know because they have never deceived us.” — Samuel Johnson

“We are the people our parents warned us about.” — Jimmy Buffett

“When they call the roll in the Senate, the Senators do not know whether to answer Present or Not guilty.” — Theodore Roosevelt

“Give a man a fish and he will eat for a day. Teach a man to fish and he will eat for a lifetime. Teach a man to create an artificial shortage of fish and he will eat steak.” — Jay Leno

“Men live in a fantasy world. I know this because I am one, and I actually receive my mail there.” — Scott Adams

“Setting a good example for children takes all the fun out of middle age.” — William Feather

“Get all the fools on your side and you can be elected to anything.” — Frank Dane

“Anger is the feeling that makes your mouth work faster than your mind.” — Evan Esar

“Why do people who know the least know it the loudest?” — Donfucius

“Democracy must be something more than two wolves and a sheep voting on what to have for dinner.” — James Bovard

“The incompetent with nothing to do can still make a mess of it.” — Laurence J. Peter

“To avoid situations in which you might make mistakes may be the biggest mistake of all.” — Peter McWilliams



May 29th, 2009

An Interview By Julieta Langarica.

Photo Above: Julieta Langarica.

Julieta Langarica is a student at the University of Wisconsin – Milwaukee. She is working towards her MBA. One of her recent “homework assignments” was to interview the President of a company (specifically – myself, Donald Dobert) regarding “Strategic Business Plans & Their Effective Implementation”. Julieta has worked at ATL for the past four years as a Quality Engineer and as an internal auditor for pharmaceutical/ medical device FDA cGMP compliance to 21 CFR 210, 211, and 820.

The following is part one of this interview.

Julieta Langarica (J.L.). What is your mission, your vision, and your strategy for the company and the direction it should be headed? What are your main goals?

Donald Dobert (D2). Our vision, more than anything else, is to provide something that the market place needs. For the company this would mean a value added niche market. If we do this, then we would accomplish our second goal, keeping our “family of employees” provided with jobs and job stability. The vision (or first goal, if done correctly), will take care of the second goal of continuous employment for our employees.

J.L. There are many different ways to implement a Generic Strategy. What would you consider as the best fit for ATL?
D2. ATL’s generic strategy is differentiation. We try to develop products and processes that no other company can match. We achieve this by investing in sophisticated machinery and by employing the best and most knowledgeable engineers and operators.

J.L. You stated that your strategy implementation keyed on the structure of the organization. What do you mean by this?
D2. The structure of the company is decentralized. At ATL, everyone is very independent and able to make their own decisions. All of our operators have taken command of their jobs. All of our operators own their jobs and want their product to be the best that can be. Our project engineers are able to use their own knowledge and creativity to come up with new products or processes. As part of the structure, ATL also uses a structure call WAMIMS (Walk a mile in my shoes). The employees at ATL are trained in many different functions to help guarantee continuous employment and variety in the employees work life.

J.L. Commentary: The President of the ATL actually worked for three years in the shop. It helped him understand the process of the product. By offering the program WAMIMS the employees can have a better understanding of the product and provide better quality to the customer. WAMIMS also provides people with different job opportunities during seasonal work.

J.L. How do you reward your employees?
D2. We like to think that we have become the employer of choice. ATL is one of the top paying employers in the six Southeastern Wisconsin counties. The management team truly cares about the employee’s goals and aspirations and their abilities to excel at their jobs.

J.L. Commentary: ATL tries to provide employees with an outstanding working environment and great benefits. Their employees are paying about 6% less for their health coverage than they were paying 6 years ago. When I asked “what does ATL do to maintain employee morale”, Donald Dobert said “Share with them continuous benefits.”

J.L. Commentary: Everyone at ATL is considered at the same level. There is not much hierarchy in the corporate structure. Everyone has the freedom to make their own choices about their job and set their goals. At the end of the day the job must be completed but how it’s completed is up to the press operator. Everyone is trained to do more than one function. It helps to keep the jobs running smoothly in case of high demand or down times. People can do different functions and that makes them more valuable for the company. The policies at ATL are very informal. People in the office usually dress “business casual” with the option to wear jeans if they spend some time in the shop.

The End.



April 28th, 2009

Digest Break. He Said It, Not Me…

Will Rogers. 1879 – 1935.

“I never met a man I didn’t like.”

“I don’t make jokes. I just watch the government and report the facts.” — Will Rogers


April 13th, 2009

The ATL Question Man #3: Japanese Pharmaceutical & Medical Device Labeling Requirements.

Question. “I am a Regulatory Affairs Specialist for a company in Massachusetts. We provide regulatory, quality, and clinical services to the biomedical industry.

We understand that all labeling and instructions for use for medical devices in Japan are required to be written in the Japanese language.

We are now trying to understand exactly what the other labeling requirements are. With 5 levels of legislation in Japan ranging from the PAL to Ministry Ordinances to administrative notices released by the MHLW, it seems impossible to find the exact piece of legislation that details these requirements. Would you be able to help me find it?

Answer. I can understand your frustration. This is kind of like the FBI, CIA, ATF, and other U.S. government agencies not working together before 9-11. I will try to help you as best I can.
The Japanese House of Representatives passed and enacted the revised Pharmaceutical Affairs Law (PAL). The original PAL dates back to 1943, with subsequent revisions in 1948, 1960, and 1979. However, the basic purpose of the law has remained the same: to ensure the safety, efficacy, and quality of medical products in Japan.

The latest revisions to the PAL are meant to address the enhancements in the development and safety of new medical products in the 21st century. According to the Ministry of Health, Labor and Welfare (MHLW), the revised PAL is intended to strengthen the safety measures related to medical devices, enhance government regulations with respect to the application of biotechnology and genome technology in developing medical products, and fortify post marketing safety measures (and the review system for approval and license) while taking international conformity into account.
The revised PAL is a done deal, but MHLW has yet to finalize many of the regulation-level details. Thus, many of the proposed changes are currently in high-level “Parliamentary Act” form. The ministry will announce regulation-level details gradually over the next several years through what they call enabling notifications.

Photo Below: Label requirements can be confusing.

Reorganization of Authoritative Bodies in the MHLW
In addition to the Japanese PAL revisions, the MHLW is also reorganizing the structure of the authoritative bodies in the ministry as part of the government’s reform efforts. The MHLW signed a bill establishing an independent administrative institution that will merge the Organization for Pharmaceutical Safety and Research (OPSR, also known as Kiko), the Pharmaceuticals and Medical Devices Evaluation Center (PMDEC) — which is under the auspices of the National Institute of Health Sciences — and the Japan Association for the Advancement of Medical Equipment (JAAME).

Prior to their unification, OPSR/Kiko and the PMDEC operated as separate government entities. OPSR/Kiko was responsible for reviewing safety and efficacy of pharmaceuticals, and the PMDEC had similar responsibilities for medical devices. JAAME was an independent association working in conjunction with MHLW, focusing on “me-too,” or derivative medical devices.

The new institution is referred to as the Comprehensive Organization for Medicines and Medical Equipments. Its primary mission will be to ensure the quality, safety, and efficacy of medicines and medical equipment in Japan. The organization will also be responsible for improving national health by addressing health problems caused by adverse drug reactions (ADRs) and infections from biological products and promoting development in pharmaceutical technology through product reviews and fundamental research.

As for the changes in MHLW for labeling:
New Guidelines for Medical Devices Packaging

The MHLW has issued new guidelines for medical device packaging — The Guideline of Package Insert for Medical Devices — which aims to provide physicians and consumers with clearer, more comprehensive product and usage information to prevent potential adverse events. Companies with already approved device products must revise their product inserts to comply with the new regulations. Basic package inserts should be in compliance with the information provided on the shonin (approval) application and should include the following:

Date of publication and most recent revision; Shonin number; Classification and generic name; Trade name; Warnings; Contraindications; Shape and structure; Performance indication for use, efficacy and/or effectiveness; Instructions for use and/or handling; Cautions; Principle of operation; Clinical records; Method and duration of preservation; Handling instructions; Maintenance instructions; Condition for shonin; Packaging information; Major reference papers and where they might be obtained; and Name and address of manufacturer and/or importer.

The name of the medical device, manufacturer’s serial number or lot number, and manufacturing code will be required to be affixed to the device or its immediate packaging. This is in addition to the direct presentation of the name of the distributor and expiration date on the medical equipment that is currently required.

If this is not the information you were looking for, I suggest you contact the “Japan Pharmaceutical Manufacturers Association” (JPMA).

Notable & Quotable: “A word to the wise ain’t necessary – it’s the stupid ones that need the advice.” — Bill Cosby


April 7th, 2009

Digest Break. He Said It, Not Me…

Niels Bohr, Danish Physicist, 1885-1962.

“Prediction is very difficult, especially about the future.”


April 5th, 2009

The ATL “Question Man” #2: Security For Hospital Pharmaceuticals.

Question. Do I need to employ security technologies for hospital-bound pharmaceuticals? Who would verify them?
Answer. The answer is must you or should you? Currently there is not a standardization for covert features as they pertain to security packaging.

You must employ security technologies if this is part of your contract with the buyer of your product. You must maintain the pedigree. If you are the brand owner, I feel strongly that you can protect the public by maintaining a record containing information regarding each transaction that results in a change of ownership of a given drug or pharmaceutical ingredient. This includes its sale by the manufacturer, through the wholesalers, distributors, and pharmacies. Overt and covert technologies work in tandem to track and trace and authenticate.

This includes: Lot or batch codes; Integrated Mass Serialization; 2D DataMatrix Codes; Forensic (invisible, non-degradable, nano-molecular) markers; and many other covert techniques.

Many people feel that President Obama will expect manufacturers to take immediate action to protect the drug supply chain, or else face regulation. This prediction comes from two members of the Partnership for Safe Medicine’s board of directors, Marvin D. Shepherd, Ph.D., and Bryan A. Liang, M.D., Ph.D., Partnership for Safe Medicines.

The Partnership for Safe Medicines is a coalition of more than 50 organizations and individuals dedicated to protecting consumers from counterfeit medicines.
“President Obama won’t have the patience that President Bush had waiting for industry,” explains Liang. The onus will be on industry, and the message will be, “If you don’t do it, we will make you do it.”
Shepherd believes that Obama will see to it that FDA mandates both serialization and authentication. “A layered approach will be favored, and companies will get to choose what technologies are employed. But the number of layers to be used may be dictated.”

Photo Below: Be careful when purchasing medications on-line. You may not be getting what you’re paying for.

Notable & Quotable: “Diplomacy is the art of saying “Nice doggie” until you can find a rock.” — Will Rogers


April 2nd, 2009

ATL’s Modern Day Parable. A Lesson Of Arrogance & Ignorance.

A spoiled, self-indulgent college freshman was walking along the beach. He took it upon himself to berate a senior citizen (who was resting on some steps) as to why it was impossible for the older generation to understand his generation.

“You grew up in a different world, actually, almost a primitive one”, the freshman said.

The young man continued his verbal abuse, and got louder and louder. His intent was to embarrass the older fellow in front of others on the beach. “The young people of today grew up with television, jet planes, space travel, and men walking on the moon. We have nuclear energy, ships and cell phones, computers with lightning speed, and so much more.”

After a brief silence, the senior citizen said to the impudent freshman, “You’re right, son. We didn’t have those things when we were young. So we invented them. Now, you arrogant little jerk, what are you going to do for the next generation?”

The applause from others on the beach was amazing.


March 20th, 2009

Digest Break: He Said This, Not Me…

Here’s something to think about. How come you never see a headline like “Psychic Wins Lottery?” __ Jay Leno


March 14th, 2009

The ATL “Question Man” #1: Covert Markings & The FDA.

Question. Do I have to notify FDA before I start to use covert markings or materials in my labels?

Answer. The current labeling requirements for pharmaceuticals are part of 21 CFR Parts 210 and 211 – Current Good Manufacturing Practice In Manufacturing, Processing, Packing or Holding of Drugs; General and Current Good Manufacturing Practice For Finished Pharmaceuticals. These are the cGMP’s (Current Good Manufacturing Practices).

The cGMP’s deal mainly with overt labeling features. These include, but are not limited to:
Written procedures designed to assure that correct labels, labeling, and packaging materials are used for drug products. These written procedures must be followed. These procedures incorporate the following features:
(a) Prevention of mixups and cross-contamination by physical or spatial separation from operations on other drug products.
(b) Identification and handling of filled drug product containers that are set aside and held in unlabeled condition for future labeling operations to preclude mislabeling of individual containers, lots, or portions of lots. Identification need not be applied to each individual container but shall be sufficient to determine name, strength, quantity of contents, and lot or control number of each container.
(c) Identification of the drug product with a lot or control number that permits determination of the history of the manufacture and control of the batch.
(d) Examination of packaging and labeling materials for suitability and correctness before packaging operations, and documentation of such examination in the batch production record.
(e) Inspection of the packaging and labeling facilities immediately before use to assure that all drug products have been removed from previous operations. Inspection shall also be made to assure that packaging and labeling materials not suitable for subsequent operations have been removed. Results of inspection shall be documented in the batch production records.

As for pharmaceuticals and tamper-evident packaging: Each manufacturer who packages an OTC drug product (except a dermatological, dentifrice, insulin, or lozenge product) for retail sale must package the product in a tamper-evident package, if this product is accessible to the public while held for sale. A tamper-evident package is one having one or more indicators or barriers to entry which, if breached or missing, can reasonably be expected to provide visible evidence to consumers that tampering has occurred. To reduce the likelihood of successful tampering and to increase the likelihood that consumers will discover if a product has been tampered with, the package is required to be distinctive by design or by the use of one or more indicators or barriers to entry that employ an identifying characteristic (e.g., a pattern, name, registered trademark, logo, or picture).

The term “distinctive by design” means the packaging cannot be duplicated with commonly available materials or through commonly available processes.

Photos Below: “Distinctive By Design” examples from August 13, 1776. This New York ten dollar bill had a distinctive pattern on the back. Please note the penalty that was printed on the bill: “Tis Death To Counterfeit”.

A tamper-evident package may involve an immediate-container and closure system or secondary-container or carton system or any combination of systems intended to provide a visual indication of package integrity. The tamper-evident feature must be designed to and must remain intact when handled in a reasonable manner during manufacture, distribution, and retail display.

Covert features lack the standardization that you would find in cGMP’s. To my knowledge, the FDA supports covert features, but there are no standards that are mandated. This is why “The International Organization of Standardization” (ISO) has approved the creation of a new Technical Committee (TC) on fraud countermeasures and controls to help address development of standards related to combating fraud. The TC, proposed by the American National Standards Institute (ANSI) in conjunction with the North American Security Products Organization (NASPO), focuses on the development of standards in the areas of brand and intellectual property protection, identity management, and financial fraud.

The proposal, identified as ISO/TS/P 206, hopes to bring together fraud experts, law enforcement, government agencies, criminologists, brand owners, and solution providers to develop relevant security standards for the use of private industries and governments worldwide. ISO recognition and support from other international standards organizations will help to counter the rising financial and social cost of worldwide fraud activity.
The new committee provides a framework to engage international fraud experts with existing ISO technical committees to create solutions to complex issues. Standards will affect parties concerned with brand protection, intellectual property, drug counterfeiting, supply chains for products of value, authentication of goods, food supply chains, identity credentials, identity management, identity theft, customs and immigration enforcement, and financial fraud. Although the scope may appear broad, it effectively addresses the wide variety of fraud throughout industry segments.

So, for now, the FDA is concerned with 21 CFR 210 and 211. These standards do not encompass covert features.

Notable & Quotable: “Your true value depends entirely on what you are compared with.” — Bob Wells


March 12th, 2009

Til Death Do You Part?

We would like to give you a glimpse of the counterfeit drug issues as they exist today. The simple fact is that your life may be at risk, or the life of someone close to you. As you read of the startling facts, please look for the words “ATL Security Note”. At this juncture we will recommend a solution that will inhibit (or eliminate) the counterfeiters ability to provide you (the public) with fake or diluted medicines.

Photo Above: Illicit drugs that were gathered during a law enforcement raid.

Counterfeit Medications – History

First documented cases of counterfeit medicines date back to 4th century BC. For more than 2,000 years, issue of fraudulent production of medicines has mostly been ignored.
Today it is multi-billion-dollar worldwide trade. Fake drugs are estimated to lead directly to the deaths of more than 500,000 people a year across the globe.

WHO (World Health Organization)

Definition of a Counterfeit Medicine

“A counterfeit medicine is one which is deliberately and fraudulently mislabelled with respect to identity and/or source. Counterfeiting can apply to both branded and generic products and counterfeit products may include products with correct ingredients, wrong ingredients, without active ingredients, with insufficient quantity of active ingredient or with fake packaging.”

Counterfeit Medications

The illicit business is worth $18 billion. It is estimated that it will double in the next two years. It represents about 10% of all pharmaceutical sales worldwide.
30% of medicines in Russia and some countries in Africa, Asia and Latin America are counterfeit. In wealthy nations this figure is approximately three percent.
In the United States this equates to eight million packs of medicines worth approximately $975 million a year.
Approximately 25% of all emails – 15 billion messages a day – are spam advertising drugs. 50% of medicines offered by websites that conceal their physical addresses are fakes. Counterfeited, diverted, and diluted medications make more illicit money than cocaine and heroin.
In 2005, more than 500,000 single doses of fake medicines were discovered across Europe. In 2006 this number had shot up to 2.5 million. Only because fake drugs have spread from local markets to more global outlets, aided by the rise of the internet, has the world recognized the magnitude of the problem.

Photo Above: This machine is manufacturing fake drugs.

WHO & IMPACT

In February 2006, WHO created first global partnership known as International Medicinal Products Anti-Counterfeiting Taskforce (IMPACT). It is made up of all 193 WHO Member States on voluntary basis. The goal is to improve coordination and harmonization across and between countries so eventually production, trading and selling of fake medicines will cease.

IMPACT focuses on following key areas:
Looks at existing laws in countries.
Provides effective models countries can use.
Develops set of principles for establishment of appropriate legislation and penal sanctions.
Coordinates action at local levels between health authorities, police, customs, and judiciary institutions to ensure proper regulation, control, investigation and prosecution.
Helps countries with weak regulatory systems to strengthen them.
Comprised of five working groups to combat the spread of counterfeits:
- legislative and regulatory infrastructure
- regulatory implementation
- enforcement
- technology
- communication

The United States and Fake Medicines

The US is a lucrative market for counterfeiters of medicines and medical devices. This is because of high prices, a large market, widespread internet connectivity, and complex supply chain. Counterfeits are not normally manufactured in US. They are distributed through online pharmacies, most of which are outside the United States.

50% of medicines sourced from websites that conceal their physical address are counterfeit. These websites advertise and supply medicines illegally, with no prescriptions.
The fake drugs are discovered in the regulated supply chain, through licensed wholesalers, parallel traders, and pharmacies.

Thus, counterfeit medicines reach patients necessitating batch recalls. Fake medicines found in US regulated supply chain are designed to deceive pharmacists and patients into believing that they are genuine. Often only laboratory analysis reveals counterfeit product.

ATL Security Note: the need for lab analysis can be reduced by the use of a mixed and rotated “layered” security approach in labels and packaging. Invisible forensic digital markers can authenticate the product as genuine from virtually anywhere in the world.

Counterfeit medicines discovered in US typically contain reduced amount of active
pharmaceutical ingredient, or wrong ingredient, or no ingredient.

All counterfeit medicines are dangerous.

There are also reports of counterfeit medical devices discovered in US, or seized on their way to US.
Drug counterfeiting occurs less frequently in the US due to strict regulatory framework that governs production of drug products and distribution chain, and enforcement against violators.
The FDA works to ensure overall quality of drug products that consumers purchase from US pharmacies remains high.
The FDA advises pharmacists, physicians, and other healthcare professionals on drugs most likely to be counterfeited and how to identify them.

A suspect patient may have received counterfeit drug if:
He has unexplained worsening of medical condition or unexpected side effect.
He reports drug tastes or looks different, tablets chipped or cracked.
He experiences unusual burning at injection site.

Photo Above: Are you willing to keep taking drugs that are not authenticated as genuine? Will you do this until “death do you part?”

The Internet

Online pharmacies offer benefits of convenience, privacy, and (often) cheaper prices.
Many online pharmacies appear reputable and similar to legitimate retail pharmacy websites BUT sell fake pills that:
- do not contain medicine approved by regulators.
- have doses that are too strong or too weak.
- contain dangerous ingredients.
- aren’t manufactured using safe standards.
- aren’t labelled, packaged or shipped properly.
- are out of date.

Online pharmacies flourish because the public cannot get many new medicines for cancer, dementia, or influenza from publicly funded services. Many sites connected to other sites and have multiple links making investigation difficult. There are jurisdictional challenges as regulatory and enforcement issues cross international lines. The system is difficult to regulate – but governments can do more to warn public of the dangers.

India

India accounts for approximately one-third of counterfeit (fake, diverted, or diluted) drugs.
The EC claims India largest source of 2.7 million counterfeit drugs was seized by its customs in 2006.
India is the number one source of counterfeit medicines, followed by UAE and China.
India’s existing regulations pose little deterrence to unscrupulous drug vendors.

India is to introduce the death penalty for sale and manufacture of fake and counterfeit medicines that cause grievous harm. The minimum prison sentence is to be increased from five to ten years. There will be higher fines for those convicted for trading in fake drugs.

Drug regulatory officials are often in collusion with manufacturers of fake medicines.
It is against the law to sell fake drugs for domestic use, but no regulatory requirements apply to India’s export market.
Common fake drugs are antibiotics, drugs for tuberculosis, malaria, and cough syrups, as well as ingredients for lifestyle drugs.
Exportation of Active Pharmaceutical Ingredient (API) plays integral role in the manufacture of counterfeit medicines.

ATL Security Note: the use of a mixed and rotated “layered” security approach in labels and packaging works just the same when protecting the public for the purity of API (Active Pharmaceutical Ingredients). Invisible forensic digital markers, color-shifting inks, and other covert features can protect the public by ensuring the API are genuine. This is commonly known as maintaining the “pedigree”.

During first six months in 2005, more than 250kg of sildenafil citrate, Viagra’s active ingredient, were exported from India to Europe. Out of one kilogram sildenafil citrate, approximately 14,000 tablets of counterfeit Viagra-pills can be produced. If sold at normal market price of genuine Viagra a profit of up to 2,000% could result.

Photo Above: Real and fake drugs, side by side. Which would you take?

China

In China, between 200,000 and 300,000 people are estimated to die each year because of counterfeit or substandard medicines. The current baby formula incidents are a sad reminder of the human pain and suffering.

China has 80,000 chemical companies, and the FDA does not know how many sell ingredients used in drugs consumed by Americans. China exports “drug ingredients” to customers in 150 countries.

China’s State Food and Drug Administration is not responsible for regulating pharmaceutical ingredients manufactured and exported by chemical companies.
Corruption and lack of protection for whistleblowers undermines China’s attempt to establish a more rigorous drug regulatory system.

In 2007, a series of scandals involving counterfeit pharmaceutical exports led to intense international pressure on the Chinese government. This resulted in conviction and subsequent sentencing to death of the country’s two top drug regulators for accepting bribes.
Some counterfeiters have the same equipment used by pharmaceutical companies.
Cases have occurred of pharmaceutical laboratories that manufacture genuine drugs during business hours and produce counterfeits at night.
Counterfeiters have set up companies that provide service of disposing of expired medicines, thus they obtain real expired medicines that they repack and re-label.

ATL Security Note. Repackaging and relabeling (as described above) could be detected if an invisible forensic code was used in security packaging for the pharmaceuticals. If this covert technique was used, the break in the pedigree could be discovered before the consumer is harmed.

Photo Above: Fake hologram (left), and genuine hologram (right).

ATL Security Note. The following is a portion of the FDA’s conclusions from 2006: “The FDA’s vision of a safe and secure prescription drug supply chain is based on transparency and accountability by all persons who handle the prescription drug throughout the supply chain. With the implementation of the pedigree regulations in December 2006, the FDA expects that supply chain stakeholders will move quickly to adopt electronic track and trace technology, implementing RFID or an alternative track and trace technology in a phased-in approach. Although there are important issues that still need resolution, these issues should not hinder the forward progress and momentum toward widespread adoption. In the meantime, the FDA believes that public health would be better protected if all stakeholders work cooperatively to enable all distributors to pass pedigrees.”

The 2006 Report also considered several technical issues related to adoption of electronic track and trace technology that were perceived as obstacles to implementation and are in need of resolution. These include:
Mass serialization and unique identification of each drug package; and Universal pedigree with national uniform information.

As a brand owner ATL believes that you can protect the public by maintaining a record containing information regarding each transaction that results in a change of ownership of a given drug or pharmaceutical ingredient. This includes its sale by the manufacturer, through the wholesalers, distributors, and pharmacies.
As a brand owner, ATL can work with you to develop:

Lot or batch codes;
Integrated Mass Serialization;
2D DataMatrix Codes;
Forensic (invisible, non-degradable, nano-molecular markers);
Many other covert techniques.

In the 1950′s, when W. Edwards Deming tried to teach U.S. Manufactures about statistical quality control, he was not listened to. At the time, the stigmas of the past (as well as arrogance and ignorance) lived within the powerful decision makers in this country. Dr. Deming went on to huge success in Japan. He believed in quality before it was a buzzword.

“We are here to make another world.” W. Edwards Deming

Photo Above: W. Edwards Deming.

I believe that U.S. pharmaceutical manufacturers (and other brand owners) must protect the public from harm by providing safety and security for the genuine purity of their products. The citizens of the world must demand this.

“We must not inhibit our forward thinking by the comfort levels of the past. If something is not working, you must fix it, repair it, or invent a new paradigm. If you don’t, how many people are you willing to harm for the sake of a few dollars?” Donald J. Dobert, President, ATL.


February 24th, 2009

Digest Break: She Said This, Not Me…

“In the beginning there was nothing. God said, ‘Let there be light!’ And there was light. There was still nothing, but you could see it a whole lot better.” — Ellen DeGeneres


January 31st, 2009

Security Packaging May Become Law In Obama Administration

2009 – New Year, New President, New Packaging?
(Article courtesy Pharmaceutical & Medical Packaging News)

President-elect Barack Obama will expect manufacturers to take immediate action to protect the drug supply chain, or else face regulation. This prediction comes from two members of the Partnership for Safe Medicine’s board of directors, Marvin D. Shepherd, Ph.D., and Bryan A. Liang, M.D., Ph.D., J.D. Shepherd is president, Partnership for Safe Medicines, as well as director, Center for Pharmacoeconomic Studies, College of Pharmacy, University of Texas-Austin. Liang is vice president, Partnership for Safe Medicines. He is also executive director, Institute of Health Law Studies, California Western School of Law; and co-director, San Diego Center for Patient Safety at the University of California, San Diego School of Medicine. The Partnership for Safe Medicines is a coalition of more than 50 organizations and individuals dedicated to protecting consumers from counterfeit medicines.

“As president, Obama won’t have the patience that President Bush had waiting for industry,” explains Liang. “The onus will be on industry, and the message will be, ‘If you don’t do it, we will make you do it.’ ”

Shepherd believes that Obama will see to it that FDA mandates both serialization and authentication. “A layered approach will be favored, and companies will get to choose what technologies are employed. But the number of layers to be used may be dictated.”

Photo Above: New laws may prevent consumers from buying “fake” drugs. A layered approach (multiple anti-counterfeiting levels) protects the public and is an excellent loss prevention tool.

Efforts to increase supply-chain safety could go further than Obama and vice-president-elect Joe Biden had originally foreseen. On the Obama-Biden Web site, www.change.gov, the team suggests that “allowing the importation of safe medicines from other developed countries” is one way the United States can reduce healthcare costs. However, Obama is reevaluating his long-standing support of drug importation programs in light of tainted medicines and other goods made in other countries, according to the Partnership for Safe Medicines. “People may be backing away from reimportation after safety concerns arose from China,” says Liang. “Expect to see a greater regulatory role, similar to what Obama is supporting in the Food Safety Bill.”

Shepherd expects that unit-of-use packaging will be favored for safety reasons. The ideal scenario would be “a bottle or blister package from the manufacturer with 30- or 60-day supplies and security devices for the pharmacist and for the patient each to use. The security code could be linked somehow with the product’s expiration date. If pharmacists aren’t counting pills, they will have time to verify each package.”

Such changes demand collaboration among manufacturers and their packaging partners, distributors, and pharmacists, says Shepherd. “We need a coordinated, voluntary effort. Without it, the government will step in with dictates.”


January 23rd, 2009

Digest Break. I Said This, Not You.

“If quitters never win, and winners never quit, then who is the fool who said, ‘Quit while you’re ahead’”? — Donfucius


January 14th, 2009

Digest Break: He Said This, Not Me…

“I find it rather easy to portray a businessman. Being bland, rather cruel and incompetent comes naturally to me.” — John Cleese


December 31st, 2008

Loss Prevention Via Security Packaging.

Increase in Drug Tampering Reports & Loss Prevention Spark New Security Considerations

Photo Above: Your profits and consumer loyalty can explode and literally “go up in smoke”, just as these defective (fake OEM) batteries did. Take simple steps in loss prevention through security packaging.

Efforts to identify and intercept phony medications are taking on a greater urgency amid increased concerns that tampering and counterfeiting may become an attractive vehicle for organized crime rings and even terrorists. Very few companies treat these events as viable loss prevention opportunities.

The profitability of expensive new drugs used to combat cancer and other diseases along with the growth of Internet and cross-border purchasing has raised the potential for exploitation motivated by greed.
Over the last decade there’s been a huge increase of tampering with or copying high value drugs that were largely injectables; now the trend seems to be more in changing labels-buying low potency materials then affixing high potency labels.

For example, vials of the anti-anemia drug Epogen were discovered with phony lot numbers. After analyzing the contents, the drug’s manufacturer sent letters alerting pharmacists and distributors that the vials each contained 2,000 units of the drug-far less than the 40,000 claimed on the labels.

A month later, manufacturer Ortho Biotech Products issued a warning to health care professionals that counterfeit lot numbers of their anti-anemia drug Procrit had been uncovered in Texas. In the process of the Epogen investigation, the Procrit vials were also found to contain concentrations of the active ingredient 20 times lower than the amount listed on the labels. How does this affect you, the consumer? How does this affect you, the brand owner? Simple: as a consumer, any fake drug can kill you. As a brand owner, lawsuits can cripple your company, and loss of public faith in your product could be devastating.

Photo Above: Security Label. Where is the covert feature? In the ink? In the adhesive? In the varnish? Just on page three? As a brand owner, only you will know, and this can be changed from production run to production run.

Consider the following loss prevention steps.

Secure your packaging against counterfeiting, tampering, fraud and diversion. This requires collaboration with someone who has the expertise and resources to provide a solution that is tailored specifically for your brand. ATL is one of the most respected security solutions providers. We offer a wide variety of technology, and we have the engineering capability to design, manufacture, and implement a security packaging solution that makes sense for you.

Photo Above: Security Labels can be “tracked and traced” all over the world, in a matter of seconds. This is a very valuable attribute for inventory controls and loss prevention.

Our printing, holographic, and overt/ covert layering production experience allows ATL to customize a security solution that can incorporate a combination of security layers such as holography, forensic digital codes, micro text, serialization, bar-coding (including 2D), track and trace, and tamper evident materials. We can combine these techniques to develop an effective security packaging solution that can work in combination with each other, or as a rotated defense (different features with varried production runs).

Photo Above: Jim Stiglich and Jeff Lord (ATL Security Label Specialists) travel the globe educating consumers and brand owners alike in anti-counterfeiting loss prevention.

Many of these solutions add a decorative dimension to your package – adding brand authentication and brand protection to your design. These same solutions reaffirm to your customers that you care about their safety and well being. And here is the kicker….

Loss Prevention. As a brand owner you can solicit your insurance company to reduce your rates. You can prove to them that you have the necessary security features that will aid law enforcement agents in the field. You will also have the evidence in place that will stand up in court. At pennies per unit, isn’t preventing a loss worth your time and effort?

Photo Above: Donald Dobert, President, ATL, speaks at the Pennsylvania Convention Center (Cold Chain Conference). The subject was anti-counterfeiting and loss prevention. Other speakers included Phil Viggani (ID Global Corp.), Nathaniel Lipkus (Gilbert’s LLP, Lawyers, Patent & Trademark Agents), and Craig Thurber (United States Department of Homeland Security).

Earl Nightingale said it best: “As Ye Sow, Ye Shall Reap…..”
“We will receive not what we idly wish for but what we justly earn. Our rewards will always be in exact proportion to our service.”


November 11th, 2008

Fight Back & Be A Champion. Philadelphia Won The World Series By Mastering The Basics. You Can Win, Too. Here Are 12 Anti-Counterfeiting (Loss Prevention) Tips:

Defeating the counterfeiters is almost as good as winning the World Series. It’s a matter of your hard work paying off.

ATL’s Twelve (Cold-Chain) Anti-Counterfeiting (Loss Prevention) Tips
- Reprinted By Popular Demand From October 4th, 2008

Recently, in Philadelphia, I spoke to pharmaceutical and bio-technology companies (the makers of life saving vaccines). I recommended a 12 step approach to strengthen their cold-chain (the logistical system of safely delivering their products). My advice to them was that they understand the following:
1. Cold chain system weaknesses;
2. Quality System Management of the cold chain;
3. Risk Management Tools (including FMEA – Failure Modes & Effects Analysis);
4. Cold chain variation (Mean & Standard Deviation);
5. The “68-95-99.7 Rule” (and the law of large numbers);
6. Out of specification “assignable causes”;
7. Packaging and equipment validation (including IQ-OQ-PQ);
8. The risks of measurement error (Repeatability & Reproducibility);
9. Layering of anti-counterfeiting techniques;
10. How counterfeiters attack, their use of bucket shops;
11. M&R (mix and rotate) overt and covert anti-counterfeiting measures;
12. Forensic Codes (invisible, digital, and non-degradable) for “fail-safe” authentication.

Why not contact ATL for a free “honest to goodness, no obligation conversation” about your supply chain? We feel that we have solid experience in anti-counterfeiting. Our main focus is not that you buy something from ATL, rather that you learn from knowledgeable people about the perils of counterfeiting. We consider it our mission to help you protect the public. We would like to consider it your mission to take a leadership role and do the right thing.

Penn State football coach, Joe Paterno, said it best:
“Success without honor is an unseasoned dish; it will satisfy your hunger, but it won’t taste good.”

Donald J. Dobert – President, ATL


October 17th, 2008

The Tainted Baby Formula/ Milk Tragedy – From Wisconsin To China. Is It Zhende (Real) Or Jiade (Fake)? How To Fight Back.

Chinese Child Lies In Hospital - Victim Of Tainted Milk

Chinese Child Lies In Hospital - Victim Of Tainted Milk

A hundred years ago, babies who couldn’t be breast-fed usually didn’t survive. Today, although breast-feeding is still the best nourishment for infants, infant formula is a close enough second that babies not only survive, but thrive. Commercially prepared formulas are regulated by the Food and Drug Administration.
The safety of commercially prepared formula is also ensured by the agency’s nutrient requirements and by strict quality control procedures that require manufacturers to analyze each batch of formula for required nutrients, to test samples for stability during the shelf life of the product, to code containers to identify the batch, and to make all records available to FDA investigators.
The composition of infant formula is similar to breast milk, but it isn’t a perfect match, because the exact chemical makeup of breast milk is still unknown. Human milk is very complex, and scientists are still trying to unravel and understand what makes it such a good source of nutrition for rapidly growing and developing infants. John C. Wallingford, Ph.D., an infant nutrition specialist with FDA’s Center for Food Safety and Applied Nutrition, says that “infant formula is increasingly close to breast milk.”
More than half the calories in breast milk come from fat, and the same is true for today’s infant formulas. This may be alarming to many American adults watching their intake of fat and cholesterol, especially when sources of saturated fats, such as coconut oil, are used in formulas. (For adults, high intakes of saturated fats tend to increase blood cholesterol levels more than other fats or oils.) But the low-fat diet recommended for adults doesn’t apply to infants.
“Infants have a very high energy requirement, and they have a restricted volume of food that they can digest,” says Wallingford. “The only way to get the energy density of a food up is to have a high amount of fat.” While greater knowledge about human milk has helped scientists improve infant formula, it has become “increasingly apparent that infant formula can never duplicate human milk. Human milk contains living cells, hormones, active enzymes, immunoglobulins and compounds with unique structures that cannot be replicated in infant formula.”

Illicit Baby Formula In Wisconsin
In 2007 a New Berlin (Wisconsin) grocery wholesaler was under investigation by the FBI on suspicion of buying and selling large quantities of stolen infant formula. Among other things, FBI agents saw approximately 200,000 cans of infant formula, some of which bore indicia (indications) of having been stolen. The FBI indicated that the company regularly received shipments of suspected stolen formula and repackaged the formula before it was sold.
The company “cleaned” the cans by removing store labels and price tags, wiped dust from the cans, repacked the cans into cartons of six, and shrink-wrapped the cartons. One search of trash at the firm’s warehouse (by agents in 2006) revealed that the company had sold more than 17,000 cans of infant formula over an unknown time period. These illicit sales would have generated more than $200,000 in revenue. More about safety risks below (at formula safety).

The China Tragedy. A Blow To Free Society.

Fear Grips Parents Over Tainted Milk & Baby Formula

Fear Grips Parents Over Tainted Milk & Baby Formula

In China, recent deaths related to tainted baby formula should trigger an alarm on more than one front. In the Chinese language, there is one pair of words that you hear constantly: zhende (meaning real, authentic), and jiade (meaning fake, imitated). This pair of words is especially important when shopping, as it depicts the difference in quality between brand name and counterfeit goods. But beyond a difference in quality, zhende and jiade also imply a difference between trust-an unwritten contract-and distrust-the absence of such contract. The deadly, ongoing scandal with tainted baby formula signals an erosion of Chinese trust in supposedly high quality, brand name products-zhende-and a setback to the development of a contract society.

The Chinese economy is growing by double digits. Their citizens hope that this will develop into a “reform and opening” to bring a higher standard of living. Part of this standard of living is symbolized in brand name products. Both small and large cities alike, with the support of officials at all levels, have stores emblazoned with names like Nike and Adidas, among others. Many of these stores and products are jiade (fake). The labels may be inscrutably similar, but the quality will almost assuredly be different. To domestic consumers willing to spend the money on the real deal, however, there is an unspoken contract: we are willing to pay if you are willing to deliver. When it comes to the well being of children, parents are universally willing to pay for zhende (authentic).

The company that is responsible for the tainted baby formula (we will call Comp-X) has essentially become a counterfeit of itself. During months of questions, tests, and reports from both parents and at least one pediatrician, the company continued to sell a product that was not zhende (authentic). Many believe that the Olympics propaganda and journalistic “security” measures stifled coverage of the fake baby formula, the “tainted product”. China is not yet a free and open society, so I believe that China’s period of strict censorship actually provided the company with a real (zhende!) opportunity. It was an opportunity they did not seize.

Hong Kong Police Check Shelves For Counterfeited Baby Formula And Tainted Milk Powder

Hong Kong Police Check Shelves For Counterfeited Baby Formula And Tainted Milk Powder

Above: Logo Of Product Being Removed From Chinese Stores

Above: Logo Of Product Being Removed From Chinese Stores

Comp-X did not quietly recall their tainted formula. They did not instruct health care centers to warn parents of babies with kidney stones that their children’s formula may be playing a role. Instead, Comp-X bribed noisy victims, ironically, with offers of more of their products. The responsibility that Chinese citizens expect from Comp-X was absent. Customers expect to fulfill their part of a public contract with Comp-X through paying more. In return, they expected a product that was not jiade (fake). Yet, for months, infants were suffering the result of Comp-X’s broken contract.

Inspection And Testing Of Counterfeited Milk Powder/ Baby Formula

Inspection And Testing Of Counterfeited Milk Powder/ Baby Formula

This is not the first deadly crisis involving baby formula. In 2004, 13 children died after being repeatedly fed formula that, unbeknownst to their parents, contained no nutrients whatsoever. The difference between the two crises, however, again illustrates the larger problem. The perpetrators of the 2004 incident were the makers of a counterfeit, off-brand product-jiade (fake). This time around, the perpetrator is Comp-X, a brand long held as zhende (authentic).

The difference between buying zhende (authentic) and jiade (fake) generally just means the difference between enjoying a treat and suffering upset stomach. For others, buying zhende or jiade can mean the difference between a year’s salary and a herd of dead livestock, as in cases of counterfeit animal feed. In 2004, although no parent wished his or her child ill, the price of buying jiade was a child’s life. Now, however, to the horror of millions, and a huge setback in the development of a contract society, the lines have blurred.

Why Target Baby Formula?
In the United States, baby formula is one of the more popular items with counterfeiters because of the ease of selling it. It has great street value. There are a lot of young mothers who are willing to pay 50 cents on the dollar for stolen formula. There is a high demand because baby formula is expensive. The consumers buying the stolen formula are young parents with not a lot of money to spend. Today, stolen formula is sold at places like flea markets or over the Internet. This poses a health risk because baby formula is temperature-sensitive.

Formula Safety
The conditions in which counterfeiters are warehousing perishable goods (including those with an expiration date) can be dangerous-even fatal-to consumers. Some baby formula has been stored in garages with rodents running across storage facilities that have no temperature controls whatsoever. When it gets hot the baby formula will break down in nutritional value if it is kept out of its correct temperature range.

The counterfeiters are good at hiding their craft. As part of their operations, the counterfeiters will clean, repackage, and re-label goods to make them appear as legitimate products. They will also switch labels, particularly if items are damaged or out of date. They think nothing of switching labels from one brand of formula to another. Counterfeiters also make counterfeit labels. (see article dated October 8th, 2008, “The Bucket Shops”).

In some cases counterfeiters may even sell the products back to the retailer, unbeknownst to them. And frequently, counterfeiters will sell the products via Internet Web sites, such as eBay. The ease with which criminals can use the Internet to sell the stolen goods now makes it more difficult to investigate these crimes.

Fighting Back

In addition to working with law enforcement, many retailers are trying to make it harder for counterfeiters to disguise the origin of the product. Many of them now stamp their product with their company name and logo, and a store number so that the retail source of the product can be identified if uncovered in a theft or for other purposes, such as a product recall.

Above: Parents In China Worry - The Chain Of Custody Has Been Lost And Children Are At Risk

Above: Parents In China Worry - The Chain Of Custody Has Been Lost And Children Are At Risk

Combating The Counterfeiters. ATL Security Solutions: Each member of the supply channel has to understand that the solution must be a collaborative, united effort to assure the safety of products that pass through their hands. This includes confirming the legitimacy of the item’s source; the doctor, wholesaler, ADR, distributor, manufacturer, and API (Active Pharmaceutical Ingredient) sources.

All it takes is one bad apple: It could be one counterfeiter; one diluted product; one re-dated product; one product with fake labels; one false repackaging run… if any of these events occur, and the secure supply channel is broken, the patients are at risk.

ATL Security Labeling Systems (TM) has a solid product line to assist you in the detection of counterfeiting and diversion. Our brands make it more difficult to steal.
From the pedigree papers to the end user, our SecurBook (TM) labels can provide a complete (100%) supply channel authentication. Identical forensic markers on (pedigree papers, bulk containers, individual units) can be scanned and read to ensure 100% accuracy. This will verify that the brand has not been counterfeited. Patented, portable-scanning units can verify and authenticate in the field.

How Does This Work? ATL Pharma utilizes the unique technology of IDGLOBAL. This consists of custom forensic markers with digital data for tracking. Specific ATL SecurBook labels contain an invisible and non-degradable forensic marker. When applied (or linked) to pedigree documentation, packaging, and containers, the supply channel becomes “secure”, because all “digital data” scans must match as identical. If they match, brand authentication and anti-counterfeiting are ensured. This is why we call ATL brands the “Secur” product line.

Invisible (Non-degradable) Forensic Marker Is Your Assurance Of Brand Authenticity

Invisible (Non-degradable) Forensic Marker Is Your Assurance Of Brand Authenticity

ATL can provide custom solutions tailored to your specific supply channel.
Other ATL Pharma brands include:
SecurLock: Tamper-Evident breakaway closure;
SecurDetek: Invisible, Hidden Page Marker;
SecurMark: Anti-Counterfeiting holograms;
SecurStretch: Tamper-Evident Unit Closure;
SecurPly: Booklets for soft squeeze tubes;
PharmaVoid: Security Closure/ Destructible Tapes;
Triple-Ply: Three-Tier overt and / or covert levels of anti-counterfeiting;
D2 WAO: Wrap-Around style (up to 19 panels) that fit most cylinders-
(U.S. Patent Applied For).

Brand protection (safeguarding the public) doesn’t cost much more than the labels and packaging in use today. If you are a brand owner, why not do the right things. Provide your customers with layered anti-counterfeiting overt and covert protection.

Remember always: “It is a terrible thing to see and have no vision.” Helen Keller


October 16th, 2008

Ringo-John-George-Paul. Counterfeit Beatles Albums.

Above: Two Beatles albums from the “Capitol” days. Did you know there were thousands of counterfeit Beatles albums before Capitol (B.C.)?

I came across an absolutely fascinating article written by Frank Daniels in 2002. It was all about “The Beatles” early albums B.C. (Before Capitol). As I read this I wondered: “If counterfeiters will go through these extreme measures to flood the market with fake records, then I had better be very careful when buying medicines or safety related items.” Here are parts of Mr. Daniels writings:
Fakes and Fantasies
A counterfeit or fake record is one that attempts to pass itself off as a genuine record that was actually issued by a legitimate record company at one time. Sometimes, counterfeits do not look exactly like the genuine copies that they mimic but are slightly different. A fantasy record or sleeve is one that pretends to be a rare and otherwise unknown item. However, no legitimate record company ever pressed or printed an item like that one.

A pirate copy of a record is a counterfeit that is made while the legitimate record is still selling. These lower quality “knock-offs” are intended to dupe people into buying them at a lower price than the genuine record album would cost. While Vee Jay and Swan (Record Companies) were still producing Beatles records, there was certainly no need for anyone to make “pirate,” “counterfeit,” or “fantasy” records on those labels. However, during the late 1960′s demand arose for Beatles records on those two labels. Counterfeiters filled that void, making counterfeit copies of “Introducing the Beatles” and of the Swan “She Loves You” single. The 1970′s and ’80′s saw even more counterfeits being circulated. Since there were no legitimate copies selling, these counterfeits are — strictly speaking — NOT “pirate” copies, even though they were not being sold as “collectors’ items.”

“She Loves You”/”I’ll Get You” – (Counterfeit) Swan 4152: white label with red print or black label with silver print.

It has been believed for some time that “thin print” copies with quotation marks were reissues available in 1966 and 1967 (just before Swan Records folded in 1967). These rumors are false, for Swan had a contract to release the single for two years and stopped pressing “She Loves You” in 1965. There are two common issues of these fakes: (1) The matrix numbers are stamped into the trail-off by machine. Unlike the genuine Swan issues, the matrix numbers are only 1/16″ high, and neither the “Reco-Art” nor “Virtue Studio” company information appears in the matrix. (2) The matrix numbers are etched by hand, otherwise as above.

The “stamped matrix” fakes have been promoted as reissues. Even though these fakes are almost as common as the ‘black label’ issues and are not genuine, public opinion for years that they were genuine has caused them to sell for $40 to $50 each. The “etched matrix” fakes have been recognized as counterfeits and usually sell for under $10.
Some counterfeit/fantasy copies of the white and red label “She Loves You” were pressed in red vinyl. These tend to sell for about $20, twice as much as the more common black vinyl counterfeits.

“Please Please Me” – “Ask Me Why” – (Fantasy) Vee Jay 498 sleeves: Since the Beatles were complete unknowns in the USA in early 1963, Vee Jay Records never issued a picture sleeve for their first release. Bootleggers have filled the void by producing fantasy sleeves. Each of the above sleeves first appeared after 1980. The first sleeve, shown above, features an early photo of the group. Like the actual single, the sleeve misspells “Beatles,” using two T’s. There are promotional markings on the reverse side, as though the sleeve had accompanied original white/gray label promo copies. In reality, the sleeve came about 20 years too late.

The second sleeve sports four drawings of the Beatles that Vee Jay actually did produce. These are the drawings that appear inside “Songs, Pictures, and Stories”. On this fantasy sleeve, the brackets logo was used, even though Vee Jay hadn’t come up with it in early 1963. The group’s name is also spelled correctly.

“From Me to You” – “Thank You Girl” – (Fantasy) Vee Jay 522 sleeves. As with the above single, there were no original picture sleeves accompanying the Beatles’ second single for Vee Jay. Bootleggers have produced at least two fantasy sleeves for the record. Again, both sleeves are of recent origin. The first sleeve is a pale imitation of the genuine sleeve to Vee Jay 581, with the photograph flipped around. The second sleeve uses the photo from the 1982 re-release of “Love Me Do.” This second-generation picture is blurry.

“Please Please Me” – “From Me to You” -(Counterfeit) Vee Jay 581 sleeves. The first of these sleeves is actually a counterfeit/fantasy item, not intended to fool someone but to simply occupy the missing place of a rare item in someone’s collection. The sleeve is clearly unlike the genuine sleeve, for the group’s name appears here in green (above photo, top) and in red on the original sleeve. The sleeve on the bottom is a different matter! Look at the top (opening) of the sleeve. Genuine copies of the VJ 581 sleeve have the slick cut so that the corners at the top are slightly rounded; copies that have the corners cut square are counterfeits.

Clearly Counterfeit Covers
Let’s first look at some fakes that are clearly identifiable just from the cover:

The cover is ugly and yellowed. The photograph is clearly a second-generation copy. The word “STEREO” is printed on the front cover (since the counterfeiters did not actually own a stereo cover). These fakes date to the late 1960′s.

Below: Here’s another “easy loser.” There are no genuine copies of the LP with a brown border around the album. Most likely, these were semi-fantasy items that were never intended to pass themselves off as genuine. Since they first appeared in the mid-to-late 1970′s, some people have forgotten that they are fakes.

Clearly Counterfeit Labels
The vast majority of counterfeit copies of “Introducing the Beatles” cannot be easily identified by their covers alone. Chances are, though, if it claims to be in stereo and claims to have “Love Me Do” in the titles on the back, it’s a phony. The best test to determine whether your item is genuine is to look at the symbols that are stamped into the matrix of the record. Since this can be difficult — even confusing for some — we’ll take the next best route: to look at the labels.

Above: This is an all black label with large brackets. These were first introduced in the late 1970′s, along with fakes of “Songs, Pictures, and Stories” and “Hear the Beatles Tell All”. The label is of higher quality than some of the “rainbow label” fakes, but since the artist name and title are separated by the spindle hole, it’s a clear fake. Also, during the 1960′s, Vee Jay never released a “large brackets” version of an “all black label.” Finally, these usually come in covers claiming that the record is in stereo; the label does not say “STEREO” — another sign of a counterfeit. Some “all black” counterfeit labels from the same period list “Ask Me Why” and “Please Please Me” — since the counterfeiters did not own copies that had “Love Me Do” and “PS I Love You” on them.

Above: This style counterfeit label was very popular — some copies date back to the 60′s. Notice the thin print on the catalog number. Like the other fakes, the mono catalog number is shown on the label; the bootleggers did not have stereo copies to copy from. That’s why the songs are in mono, too. Here, we see again the telltale sign — that the word “STEREO” is absent, and the title and artist name are separated by the spindle hole. Either one of these is the sign of a fake.

Above: By the late 1970′s, some copies of the same style fake as the one above were being made sloppily. Notice that the label is not the right size. Part of the color band is missing around the label’s edge. Otherwise, it exhibits the same counterfeit characteristics as the label above.

Above: This counterfeit, from the early 1980′s, looks slightly better. The colors in the color band are more realistic. However, the word “STEREO” is still missing, and the cover this record came with claimed it was in stereo. It’s also got the title and artist’s name separated. Another fake.

Above: Here’s another fake, again slightly more professional looking. This one came out during the mid 1980′s. Once again, though, we have a brackets label copy without “STEREO” (and the cover promised us stereo). And even more clearly, the title and artist’s name are separated by the spindle hole in the middle. A disappointing effort.

Above: This counterfeit was color photocopied from a genuine MONO copy of the LP, so the title and artist’s name are in the right place. The colors are strange, but it would fool most people. It came in a “stereo” cover, though, so again something is wrong. Notice that the color green is missing from the label. The record also lists “Please Please Me” and “Ask Me Why,” since that’s the kind of genuine copy that was being photocopied. The label also has a large pressing ring, a kind not found on genuine 1964 releases.

Fast Forward To 2008

Many thanks go to Mr. Frank Daniels for his highly interesting work on different Beatles counterfeits. As he pointed in 2002, counterfeiters were running wild when a buck was to be made. Today, why would you risk buying prescription medicines and “genuine” OEM auto parts that cannot be authenticated as “the real goods”?

If you are a brand owner, it doesn’t cost much to secure packaging and provide consumers with labeling that has “layered” overt and covert anti-counterfeiting protection.

If you are a consumer, we encourage you to ask manufacturers what they are doing to protect you from purchasing counterfeited goods. After all, if there are “hundreds” of Beatles counterfeits, it is logical to assume that there are thousands of chances that you are purchasing “fake”, “illicit”, “diverted”, or “diluted” prescription medications. Fight back. Insist on brand protection.

It’s time to take bold leadership and protect the public. Mark Twain said it best: “Keep away from people who try to belittle your ambitions. Small people always do that, but the really great make you feel that you, too, can become great, and your ideas have merit.”


October 4th, 2008

ATL’s Twelve (Cold-Chain) Anti-Counterfeiting Tips

Recently, in Philadelphia, I spoke to pharmaceutical and bio-technology companies (the makers of life saving vaccines). I recommended a 12 step approach to strengthen their cold-chain (the logistical system of safely delivering their products). My advice to them was that they understand the following:
1. Cold chain system weaknesses;
2. Quality System Management of the cold chain;
3. Risk Management Tools (including FMEA – Failure Modes & Effects Analysis);
4. Cold chain variation (Mean & Standard Deviation);
5. The “68-95-99.7 Rule” (and the law of large numbers);
6. Out of specification “assignable causes”;
7. Packaging and equipment validation (including IQ-OQ-PQ);
8. The risks of measurement error (Repeatability & Reproducibility);
9. Layering of anti-counterfeiting techniques;
10. How counterfeiters attack, their use of bucket shops;
11. M&R (mix and rotate) overt and covert anti-counterfeiting measures;
12. Forensic Codes (invisible, digital, and non-degradable) for “fail-safe” authentication.

Why not contact ATL for a free “honest to goodness, no obligation conversation” about your supply chain? We feel that we have solid experience in anti-counterfeiting. Our main focus is not that you buy something from ATL, rather that you learn from knowledgeable people about the perils of counterfeiting. We consider it our mission to help you protect the public. We would like to consider it your mission to take a leadership role and do the right thing.

Penn State football coach, Joe Paterno, said it best:
“Success without honor is an unseasoned dish; it will satisfy your hunger, but it won’t taste good.”

Donald J. Dobert – President, ATL


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