Trust, ethics and spurious medicine

In the competitive environment of the Southasian pharmaceutical industry, the consumer is today left with neither a guide nor a map.

In marketing there are three C’s we use: First we try to convince. Then we try to confuse. If the doctor is confused, they can think, ‘Maybe the drug will work, let’s just try it.’ And then he will prescribe a few. And then the third C is to corrupt.
– Anti-depression drugs-marketing manager, 7 November 2007

Pharmaceuticals are poisons, chemicals that have both potentially beneficial and potentially dangerous effects on the body. The system that produces, distributes and dispenses pharmaceuticals is vast and complex, and questions of trust are central to the concerns of all involved, but particularly to the consumers of medicines. When ill and vulnerable, as consumers, we need to be assured of the quality and efficacy of the product. We need to trust the product and know that the drug being dispensed is what it claims to be; that the quality of the drug is such that it will not poison us with the unwanted effects; and that the dosage of active ingredients is as stated on the package. We need to trust the prescribers and retailers to give us the right drug for the right condition. And when things go wrong – when medicine is prescribed not because it is right for the patient but because it gives most profit to the prescriber, or when the true ingredients are not as stated on the label – patients may die. But since we, the general public, know so little about what the various drugs actually do, we simply have to trust the suppliers – in ways we would never do when dealing with, say, a mechanic or a shopkeeper.

What are the main threats to trust in the drugs industry in Southasia? What is at stake here? In this system, it is difficult to get to the truth. Different actors push certain ‘truths’ over and above others, in a complex chain. To answer these questions, let us consider just two scenarios: the fear that the drugs in the market are substandard in some way; and distrust of retailers when they recommend some drugs rather than others. In the last days of Prime Minister Manmohan Singh’s 2004-09 government, it radically increased the penalties for producing or dealing in spurious drugs, to a minimum ten-year jail term or a life sentence in grave incidents. Spurious drugs have become a major issue in India, but what exactly is the evidence for the size of the problem?

There are two extreme pictures of the problem. On the one hand, according to Dr M Venkateswarlu, the former Drugs Controller General of India, it is not really a problem at all. Speaking in 2008, he said, “At present, about five percent of the drugs available in India are counterfeit while 0.3 percent are spurious.” (By counterfeit, however, he means merely that they may be mislabelled, not that the contents are dangerous.) But the picture often presented by the mass media, on the other hand, is completely different, suggesting that India is a major source of spurious and counterfeited medicine, within the country and for all those countries (such as Nepal) who depend on Indian producers for most of their drugs. Probe a little deeper, however, and both sets of claims are themselves spurious.

Indian bogey
In 2003, representatives of the Confederation of Indian Industry (CII) told a committee of experts on drugs regulation that the World Health Organisation (WHO) had estimated that “35 percent of fake drugs produced in the world come from India, which has a INR 4,000 crore (USD 809.7 million) spurious-drug market. About 20 percent of medicines in the country are fake or sub-standard. Of these, 60 percent do not contain any active ingredient, 19 percent contain wrong ingredients, and 16 percent have harmful and inappropriate ingredients.” It all sounds pretty bad: if true, people in India are as likely to be suffering from partially and untreated illnesses or adverse reactions, as much as from the conditions themselves.

However, these claims are largely unsupported by evidence. When the head of the committee, Dr R A Mashelkar, challenged the CII to supply its sources, the latter failed to deliver anything to support its claims. The WHO also denied ever having produced a study with the results attributed to it – in a report from 2006, it had merely repeated the claims of the companies themselves: “Indian pharmaceutical companies have suggested that in India’s major cities, one in five strips of medicines sold is a fake. They claim a loss in revenue of between 4 percent and 5 percent annually.” If true, this would mean a loss of at least USD 250 million per year. But the industry also estimates that “spurious drugs have grown from 10 percent to 20 percent of the total market” – or USD 1.2 to 2.4 billion per year (in 2005). What can this mean? Since it refers to other companies who make and sell these drugs at a cheaper price, it usually means a loss to the larger companies, due to what they see as unfair competition. In fact, then, it is not dangerous or substandard, but rather misleading marketing – labels that look particularly like those of the big companies. That is, there is no evidence of harm to patients, just endlessly recycled claims of harm to big companies. Here the WHO, into whose symbolic presence so much trust is invested, seems to uncritically align its statements with the claims of large manufacturers.

Another much-cited claim comes from the European Commission’s Taxation and Customs Union, which suggests that 75 percent of the cases of counterfeit medicines seized on the EU borders originate from India. But this refers to a single year – 2005 – and by 2007 only 35 percent was said to be coming from India, while counterfeit medicines originating in Switzerland comprised 39 percent of the total. Yet perhaps due to the trust in which Swiss drug companies are held, that bit of statistics is not widely known. But images of India and its pharmaceuticals industry are at stake here, and figures such as these feed into negative images that are already widely circulating.

What interests might be at stake in propagating such an image? Disentangling myths from facts in this sphere is a vital issue. For example, most drugs sold in India are generics, with relatively tight profit margins. But the big profits from counterfeiting come from Internet sales, and globally, we are told by the Vienna-based Pharmaceuticals Security Institute, “over 60 percent of drugs seized were for treatment of erectile dysfunction.” So once again, even if Indian companies are making a significant amount of counterfeit drugs, they are not likely to be those that are on the essential medicines list, nor are they being taken for life-threatening disorders by the poor. Drugs with more implications for public health, such as those dealing with tuberculosis or cholera, are rarely ones for which massive counterfeiting is alleged, and certainly not proven. While there is evidence that some TB drugs and combinations of drugs produced by smaller companies in India may have lower amounts of active ingredients than stated on the label, the problem of practitioners prescribing the wrong combinations seems to be a far greater one.

Big fish and Western horses
Part of the problem in these claims and counterclaims is confusion over terms, which tend to be conflated. Spurious can mean mislabelled (claiming to be something other than it is), an imitation of another drug, or not from the manufacturer named on the label. Some of the discussion is also about whether a pill or tablet meets precise requirements of quantity and the condition of the active ingredients – too much can lead to being labelled spurious just as much as too little, or too coarse, or any number of other problems. Counterfeit is also not a self-evident term, and one that is deeply contested. Adulteration – or the addition of things that should not be included in the drug, whether on purpose or through poor production standards – is not being widely picked up either. As such, patients should try to stand firm against the idea that there is danger in taking the drugs made by the smaller or lesser-known companies.

One case of truly fake medicine that was much talked about in company circles, involved the use of the packaging of a well-known multinational antibiotic brand with only powder inside. The product was packaged illegally in India, and was smuggled across the border from India into the Tarai in eastern Nepal. As researchers, we were frequently asked which drug we would trust if we needed, for instance, an antibiotic? In the context of Nepal, our answer is that the products of one of the larger, well-known companies producing drugs for the national market is as safe as any other option. Such local companies are striving to improve their factories and procedures – for example, by adapting to Good Manufacturing Practice norms set by the WHO. Even though such norms can be misused to limit competition, or as a tool for putting small companies out of business, they still represent worthwhile standards to aim for.

The extent to which trust – or in this case, mistrust – can affect debates and decisions concerning counterfeit medicine is provided by discussions that took place in 2008-09 in a WHO body called the International Medical Products Anti-Counterfeiting Taskforce (IMPACT), the International Medical Products Anti-Counterfeiting Taskforce. Its proposal of a new definition for counterfeit raised a storm of protest in India, because it was interpreted as an attempt by Western countries and their large pharmaceutical companies to stifle legitimate competition from generic producers. Under the new definition, claimed the Indian government and local activist groups, if a medicine in its packing or appearance seemed to imitate the packaging or appearance of a medicine protected under trademark legislation, then that medicine would be regarded as counterfeit. New Delhi saw this as something of a Trojan horse, opening the door to more accusations that the Indian pharmaceutical industry is unethical, has low standards or is inadequately regulated. In this way, Indian officials are also seen to be more concerned about image than real threats to patient well-being.

Given the lack of reliable evidence in this area, it is not surprising that unsubstantiated claims and rumour drive out harder sources of information. The CII agenda seems to be to separate the respectable, safe, large producers from the myriad small- and medium-scale enterprises, and thus to establish trust in the big Indian companies and enhance their export potential. CII representatives wave the flag of ‘danger to patients’, but really they seem to be more concerned about danger to profits. As one small-scale industry representative put it, “Probably it’s a concerted effort by those people, including the people in the government, to somehow or the other sideline the small scale.” There is also a great deal of truth in the views expressed by Delhi’s then-deputy drug controller, G C Lal, in 2001, “A lot of the time it is just old brand rivalry. The big fish cannot bear to find smaller chaps coming out with similar medicines, so they say ‘Spurious, duplicate, etc’.”

On closer inspection, then it turns out that questions about fake, counterfeit and spurious medicines depend on who you believe. Since everyone blames everyone else, listening to all sides of the argument does not necessarily get one closer to the truth of the matter.

Ethics versus business
Let us move across the border into Nepal, to look at the pharmaceutical market that is perhaps the single most affected by what takes place in India, which currently supplies some 70 percent of the country’s market. So who can be trusted in Nepal’s pharmaceuticals trade? In 2007, fierce disputes broke out over ethics and drug marketing in Nepal. Consider the situation: an environment of increasing competition from local and Indian producers, as Nepali companies strive for a larger share of the national market, dominated by Indian imports; and the mushrooming of medical practitioners and proliferating retail outlets in urban areas, emerging from the increasing numbers of private medical colleges. In July of that year, Nepal’s Department of Drug Administration (DDA) issued a preliminary set of “Guidelines on Ethical Promotion of Medicine”, which had apparently been produced after widespread consultation and under prompting from the Graduate Pharmacists’ Association of Nepal (GPAN).

Throughout the Guidelines, the concern is to distinguish “ethical promotion” from “business” practice. This, it turns out, is a core distinction and issue recognised by nearly everyone we interviewed, on the understanding that the increasingly competitive environment for marketing drugs was compromising broader issues of public health. In particular, the Guidelines attacked the practice of giving bonuses to retailers and doctors who put out a large amount of a particular drug, and the consequent temptation for these groups to substitute the prescribed brand with one that would make them more money. But all groups involved in medical treatment, however peripherally, were encouraged to adopt the Guidelines.

Most of the contents of the Guidelines could only be described as unexceptionable. Who could say, for example, that it is a bad idea that, “All promotion-making claims concerning medicine should be reliable, accurate, truthful, informative, balanced, up-to-date, capable of substantiation and in good taste”? But underlying these bland statements is a sense that, due to increased competition, business (read: unethical) practices have been flourishing – and there is plenty of evidence that this is the case. Not surprisingly, then, the release of the Guidelines was met with outrage and hostility from many corners. There was widespread denial that unethical practices were taking place; or that, if they were, the blame lies squarely with someone else.

For instance, a representative of the Nepal Medical Association was merely repeating the common claims made by doctors when he told us, “The [criticism] that the majority of the doctors unethically take bribes from some pharmaceutical companies to prescribe their drugs does not hold any ground. While entering into the profession, the doctors take an oath to perform their duties with humanity, compassion and dedication to the welfare of the sick people according to the best of their ability and judgement.” The good doctor similarly ducked the question of whether it is even possible, under Nepal’s current conditions, for his fellow practitioners to follow through on such promises. Producers likewise denied any wrongdoing. One of the leading industrialists told us, “If we implement this code of conduct properly, the price of the medicine would decrease, and we are agreed to do so. We are always ready to implement this ethical guideline, and are ready to cooperate with the government and the ministry.”

Meanwhile, medical representatives (MRs) – the salespeople who work for pharmaceutical companies – linked the Guidelines to their demands for recognition by the DDA, and to the need for Indian companies to open local offices in Nepal. Currently the medical representatives (commonly referred to as MRs) who work for Indian companies are liable to pay Indian taxes, and they feel they are under undue pressure from Indian companies to meet their targets. As one representative (who was assured anonymity, as were several of the subjects of this research) of the MRs said, “If DDA implements this properly along with the registration of MRs, 60 percent of the ethical concern will be solved. For the remaining 40 percent, concerns are related to the behaviour of the prescribers and the retailers.” They were concerned that the ethical guidelines had a section focused specifically on them, and tended to see the issue in conjunction with the fact that their jobs are target- and performance-oriented, and that doctors are increasingly demanding more and more elaborate gifts before they behave in ways that will let the MRs meet their targets. (The issue of how Indian MRs could be impacted by Nepali policy is too complex to be dealt with adequately in this article.)

So how did the retailers respond? Their association, the Nepal Chemists and Druggists Association (NCDA), was the most vehemently opposed to the proposed Guidelines, even though its representatives said that they did not disagree with the regulations in principle. The role of the NCDA is “to promote and safeguard the pharmaceutical trade” while enforcing price unification. Its 12-point counter-demands to the Ministry of Health (MoH) stimulated a range of agitations involving all “entrepreneurs”, and its members picketed the Department of Drug Administration. As a result of these agitations, they were able to interrupt the drugs supply chain for a few days, immediately causing the Ministry of Health to take their demands seriously and setting in motion further counter-agitations by GPAN pharmacists.

One NCDA representative described their reasoning. By focusing on the question of bonuses, the result will not be that drug prices go down, he said, but rather that profits will be transmitted straight to the producers. By focusing on bonuses in the absence of demanding that prices are dropped, it is the people and retailers who lose out, as the surplus that the bonus system generated before goes back to the pharmaceutical companies. He saw the Department of Drug Administration and the pharmaceutical companies as being in cahoots over the release of the Guidelines, generating varying degrees of conspiracy theories and other rumours of complicity. Unfortunately, as with any conspiracy theory, the evidence is circumstantial and difficult to unravel. Other NCDA members also argued that such regulations cannot be implemented unilaterally in the way that was being proposed, but rather required much more debate and discussion.

A year later, the DDA said the Guidelines remained “partially” in effect, and had not been fully implemented. A senior member of the DDA suggested that after the formation of the new government and the writing of the new constitution that the polity is engaged in, it might then be possible to do something more substantial. In other words, all hope of regulation and ethics has been, again, deferred. Indeed, the continual deferment of the Guidelines seems necessary to allow the whole apparatus of the pharmaceutical industry to function. Perhaps the mistake was to try to codify in writing where the problems lie: then widespread protest against any proposed change becomes manifest and irresistible.

Vested medicine
These two scenarios tell us much about trust, and how to relate to who or what to believe. Not all of it is positive. In a complex system such as the pharmaceutical trade, there are so many vested interests and players that it is all too easy to deflect blame for systemic issues onto another group, and not to reflect critically on one’s own practices. In trying to understand the pharmaceutical industry of Southasia and the various claims and counterclaims, it has been critical to remain wary of the ethical claims made by anyone in this network. Small companies claim their standards are as high as those of big companies; big companies, meanwhile, accuse the small ones of all kinds of nefarious behaviour – yet still do not hesitate to get the same companies to produce medicine for them if there is a financial benefit in doing so.

So what should be done? What are the hazards of this to the consumers? In short, patients would be very unwise to completely trust the public or private statements made by a single set of actors. To understand what is at stake, as responsible consumers, we all need to look beneath the surface of such claims to gain a better understanding of the varied positions and where the vested interests lie. All sides involved have vested interests, be they financial, political or economic. Unfortunately these interests, and the associated custom of being protective of ones own practices at the expense of others, means that the public is left confused and unsure of where to turn. When retailers, producers, medical representatives and doctors all accuse someone else of being responsible for unethical behaviour, you can be sure that this is exactly what is happening, and that they are all benefiting from the activities. Without vastly increased transparency in matters of drug promotion, pricing and retailing, public health issues will remain sidelined – and it will remain impossible to shrug off the suspicion that if profit and the patient’s well-being are in conflict, the latter is seen to lose out.

The research for this article was funded by the Economic and Social Research Council under a joint scheme with the Department for International Development. Martin Chautari (Kathmandu) and the Centre for Health and Social Justice (New Delhi) were partners. Thanks to Nabin Rawal and Madhusudan Subedi for assistance.

~ Ian Harper and Roger Jeffery are based at the University of Edinburgh.