INTERNATIONAL CONFERENCE
COMBATS COUNTERFEIT DRUGS IN RUSSIA

Experts, Industry Leaders and Officials Call for "Better Laws, More Enforcement and Increased Cooperation"

Moscow - Calling counterfeit drugs "an insidious threat to the health and well being of the Russian people," a coalition of Russian and international government and law enforcement officials, pharmaceutical manufacturers and anti-counterfeiting organizations today unveiled a three-pronged action plan to combat the proliferation of counterfeit medicines in the Russian Federation.
The Action Plan to Fight Counterfeit Drugs in Russia was developed as part of an international conference held today in Moscow, which was sponsored by the Association of International Pharmaceutical Manufacturers (AIPM) in cooperation with the RF Ministry of Health, the RF State Duma Health & Sports Committee, the Coalition for Intellectual Property Rights (CIPR) and the International Anti-Counterfeiting Coalition (IACC). The conference brought together more than 200 leading government, industry and academic experts to discuss common strategies for stemming the tide of counterfeit drugs in the Russian Federation.
Russian Deputy Health Minister Anton Katlinsky said counterfeiting of medicines "is nothing less than a threat to our country's national security. The Government's objective," he told conference attendees, "is to make certain we stop this growing problem before it gets out of hand."
"Fighting counterfeit medicines requires better laws, better enforcement and better cooperation among the public and private sectors," said Robert Rosen, executive director of AIPM, a Russia-based organization representing many of the world's largest producers of medicines and pharmaceutical products. "These are the three essential strategies to succeed in the fight against counterfeit drugs in Russia."
Adoption of a strongly worded joint action resolution was a central focus of the discussions and presentations at today's conference. Drafted by AIPM in cooperation with the Coalition for Intellectual Property Rights and government regulators, the resolution details a three-part "Action Plan to Fight Counterfeit Drugs in Russia."
The action plan calls for active support of pending amendments to Russia's laws on medicine, on trademarks and on patents, as well as to the administrative, criminal and customs codes; stepped-up enforcement efforts to apprehend, prosecute and punish counterfeiters; and, closer cooperation between the public sector and private companies on reporting and sharing information about counterfeit activities in Russia.
Jeffrey Lack, chairman of the AIPM Anti-Counterfeiting Committee, said, "estimates of the true incidence of counterfeit medicines on the Russian market vary widely. Together with health and law enforcement officials, the Russian and western pharmaceutical companies are working hard to get an accurate picture of the depth of the problem." He noted that the RF Ministry of Interior estimates that the actual percent of counterfeits in Russia may be as high as 7 percent.
"But debates over numbers miss the point. Because counterfeit medicines are so threatening to the health and even the lives of some patients, the policy of AIPM members and our Russian industry partners is zero tolerance of counterfeits," said Lack, who is also Russia & CIS General Manager for Bristol-Myers Squibb.
Jacques Farge, General Manager of Aventis of France, the largest supplier of pharmaceuticals in Russia, pointed to one case involving his company as an example of the serious public health risks of counterfeiting. In August 2000, Aventis recalled more than 1 million packages of the widely-used antibiotic Claforan, after counterfeits of the product containing dangerous levels of methanol, a toxic substance, were discovered in a number of retail pharmacies.
"Due to quick action on the part of my company and the Ministry of Health, we averted a crisis, but at considerable expense to Aventis and at considerable potential risk to public health," said Farge.
"Stopping the practice and profession of counterfeiting in its tracks must be a top priority of both government and industry alike," added Rosen. "That is one reason why AIPM and its Russian partners are so opposed to the premature imposition of a national value added tax on medicines, scheduled to take effect 1 January 2002. Anything that adds significantly to consumer prices for safe and legitimate medicines will also add to the proliferation of counterfeit medicines - a prospect that neither the Russian government nor the Russian people can afford."
Russian and international industry experts predict that if the planned 20 percent VAT goes into effect on pharmaceuticals, counterfeit medicines could rapidly capture between 20 and 30 percent of the entire Russian marketplace.
"Counterfeiters of medicine are terrorists in their own right," said Nikolay Gerasimenko, Chairman of the State Duma Health & Sport Committee. "These criminals prey on the health and lives of Russia's sick and poor seeking economic gain by exploiting those whose lives depend on high-quality pharmaceuticals - they must be caught and held accountable."
Gerasimenko said that the federal and regional governments are also victims of the trade in counterfeit medicines. "Our budgets lose tens of millions in taxes, duties and other revenues to the criminals while the costs of law enforcement increase. Legitimate pharmaceutical manufacturers are also victimized, Gerasimenko added, "because counterfeiting cause losses in consumer confidence and reduced incentives for the research and development of new life-saving medicines."
Today's conference took place against the background of significant activity by the Ministry of Health, the State Duma, Rospatent, and the Russian government to move a number of legislative proposals to fight the trade in counterfeiting and improve intellectual property rights protection in Russia.
"The Government's legislative proposals, including those of the Ministry of Health, will provide the framework for stopping the illegal production and trafficking of counterfeits, including medicines," said Dr. Alexander Korchagin, General Director of Rospatent. "This is a critical period for the Government, the Duma and the private sector to achieve truly international standards of intellectual property protection in the Russian Federation."
Alexander Shelemekh, Vice President of the Coalition for Intellectual Property Rights (CIPR), underscored that "all owners of intellectual property, from pharmaceutical companies to food producers and software manufacturers, must work together on common lobbying, enforcement and educational agendas. None of us can go it alone and hope to succeed, not government, not the Duma and certainly not the private sector."
Tim Trainer, president of the International AntiCounterfeiting Coalition (IACC), said, "better enforcement in particular is needed. That means stopping counterfeit medicines at borders, seizing and destroying stockpiles of counterfeit drugs, and prosecuting and imposing strong penalties on those who manufacture and trade in counterfeits."
Some experts believe that only 80 percent of counterfeit pharmaceuticals are removed from circulation before they go to drug stores in Russia and reach the Russian consumer.
Trainer, a former U.S. government official whose organization represents a number of the world's largest manufacturers, emphasized that, "greater cooperation and joint working programs between Russian law enforcement, customs, and judicial officials with their counterparts in other parts of the world is a prerequisite for fighting counterfeit medicines.
"Counterfeiting of medicines and other consumer goods is a world-wide problem of growing magnitude," he said. "Russia needs to do its part to stop counterfeiting on its own turf, while cooperating with the international community on a global anti-counterfeiting strategy."
"Today's conference is a microcosm of the type of public and private partnership that is needed to win the battle against counterfeit medicines in Russia," said Rosen of AIPM. "In cooperation with CIPR, IACC and other coalitions inside and outside of the Russian and international pharmaceutical industry, AIPM look forward to working even more closely with Russian government and Duma leaders, and our counterparts in the Russian pharmaceutical industry, to protect the public health by fighting counterfeits."

For more information, contact Robert Rosen of AIPM at (7095) 933-7040 or www.aipm.org;; Alexander Shelemekh and Peter B. Necarsulmer of CIPR at (7095) 745-8700 orr www.cipr.org: and, Tim Trainer of IACC at (1202) 223 6667 or www.iacc.org.