ISTANBUL — One of the most vibrant cities in the world, renowned as a crossroads between East and West, Istanbul has benefited hugely as the hub of a major trade route. But the benefit of being at such a key location also brings the burden of care—that goods passing through should be safe and legal. It was therefore appropriate that in Istanbul I met with pharmaceutical experts trying to stop the lethal trade in counterfeit drugs.

Turkey has a problem with fake drugs, but none of the local security and pharmaceutical experts I spoke with were really sure how bad a problem the 77 million people of Turkey face. Turkey has more than 24,000 pharmacies, many of which operate to high standards and are like Northern European or U.S. pharmacies, but hundreds and probably thousands are small holes in the wall, with little quality control over what they dispense.

Turkish businesses benefit from more than a dozen free trade zones throughout the country, which allow for a low tax environment to boost exports and earn foreign currency. But with the benefits of open trade, particularly light regulation, comes the downside—these zones are transit points for fake drugs. According to Cengiz Gumustus, a private investigator working for the pharmaceutical industry, one free trade zone in southern Turkey, Mersin, has a major problem in this regard, as do two zones close to Istanbul. For over a decade Gumustus was a Turkish policeman and worked for Interpol for several years too. He says that “anything of high value” will be faked.

In a sampling of drugs purchased over the internet in the United States, more packages came from Turkey than any other location.

The Turkish government has made various attempts to limit the trade, notably by banning internet drug sales. My own ongoing research shows that Turkish products are widely available in other countries when purchased over the internet. In a stratified sampling of drugs purchased over the internet in the United States, more packages came from Turkey than any other location. Turkish-made products are easy to get and generally of high quality, but significant trade flows allow unscrupulous suppliers greater opportunity to provide sub-standard products to the market.

On October 19, 2008, the Istanbul Financial Crimes Department concluded the initial phase of a major operation called "Aci Recete" (Bitter Prescription) with a series of raids on suspected purveyors of counterfeit drugs. Seven dozen targets—offices, houses, warehouses, pharmacists, and so on—were raided in Istanbul along with 16 other locations in the cities of Ankara, Batman, Konya, and Samsun.

Seventy-seven people were arrested in Istanbul for threats to public health and various different types of fraud and document forgery. The perpetrators were involved in all aspects of the counterfeit drugs trade—importers and local manufacturers of counterfeit products; wholesale distributors who were repackaging fake and old medicines, which should have been destroyed; printers making packaging for the manufacturers. Down the chain, pharmacists, doctors, and nurses were also involved in the scam. In addition to much paperwork and printed materials, four truck loads of fake and old pharmaceuticals were seized. Over three dozen arrests were made in other parts of Turkey.

Only China, South Korea, and Brazil made more arrests of counterfeiters than Turkey.

The Turkish authorities made an additional 68 separate arrests of counterfeiters last year, which put them fourth in the global list compiled by the Pharmaceutical Security Institute. Only China, South Korea, and Brazil made more arrests.

Turkish authorities are also rolling out a barcode tracking system for all pharmaceutical products. This will provide the ability to track products from entry into the country (or production in the country) through to the point of sale. At each point along the way the bar code must be scanned with information being held on a centralized computer system by legitimate manufacturers. Such a bar-code system can be costly, and the industry manufacturers and wholesalers I spoke with estimate that it has cost them over $200 million. But some of the smaller pharmacists have balked at the cost of the system to them, estimated at about $150 each to purchase a special bar-code scanner. Most of the pharmacists can easily afford it, but many are very small companies, where $150 may be a week’s profit. Their lobbying against the system, which is otherwise ready to begin, meant that the intended launch of the program on July 1 has been delayed, but government officials remain hopeful it will be implemented before the fall.

Turkey still has much to do even if it enacts this tracking system. Its laws are somewhat confusing in relation to counterfeiting and substandard medicines. For example, there is no crime in trading fake drugs unless the legitimate producer complains. While most producers will happily complain if their product is faked, the law creates a convoluted system that makes the job of the police less certain, since they are beholden to corporations to act. Ultimately this means the onus is on the corporations, and really only allows the police to act when they are spoon fed cases by the companies themselves.  

But still, it is encouraging that Turkey is moving forward; let’s hope its example will be followed by those countries on trade routes to the South and East, where so far there has been little movement or action.

Roger Bate is Legatum Fellow at the American Enterprise Institute.
 

FURTHER READING: Bate previously wrote for The American on India’s counterfeit and substandard pharmaceutical products in “Bad Medicine” and “Fighting Fake Drugs in India.” In “Fake!” he reported on counterfeit medicine in Africa.

Image by Darren Wamboldt/Bergman Group.