COUNTERFEIT MEDICINES IMPACT AND POTENTIAL SOLUTIONS

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1 COUNTERFEIT MEDICINES IMPACT AND POTENTIAL SOLUTIONS October 2-3, 2012 The World Bank Innovative technologies to identify fake and substandard drugs in resource-limited settings: Supply chain related technologies Pierre Viaud Senior Director Public Affairs & Government Relations SICPA Security Solutions SA

2 I. SICPA Company overview AGENDA II. III. World Bank Operational Policies on Pharmaceutical Lending Product and supply chain integrity Product integrity Supply chain integrity Recent initiatives in the pharmaceutical sector IV. SICPA Pharmaceutical products Project with the Government of Albania

3 I. SICPA COMPANY OVERVIEW

4 SICPA, AT A GLANCE Global company founded in Operations in 28 countries and Business activities in more than 180 countries About employees worldwide, including over 600 highly skilled engineers and scientists involved in R&D activities Leading global provider of security inks for banknotes and integrated security solutions for taxable consumer products Implementing secure track and trace solutions for reconciliation and enhancement of government tax revenues; currently securing over $40 billion per year in excise tax and VAT collections with 100 billion coded products per year.

5 To reach its fiscal policy and public health objectives, Finance Ministries in the world can count on an integrated system of acquisition and management of data on the production and import of relevant products. The SICPATRACE security platform can accommodate numerous products, by governmental decision, so as to protect licit industries and help promote the conditions suitable for economic development and the investment climate. SICPATRACE is a proven Secure Track & Trace solution that provides all the functionalities and features to successfully address illicit activities of smuggling and counterfeiting, to fully protect the products' integrity, and to secure their supply chain. To date, it is the only organization in the world to have successfully installed secure track and trace systems that are independently run and controlled by governments only Databank on Advanced Technologies World Customs Organization

6 II. World Bank Operational Policies on Pharmaceutical Lending

7 The World Bank Operational Policies on Pharmaceutical Lending - Procurement World Bank Procurement Manual, section 28: Procurement of Pharmaceuticals and Vaccines: Assessment of Borrower capacity to procure drugs includes capacity for monitoring and inspection of shipments by another qualified independent regulatory and testing agency acceptable to the Borrower and the Bank, as a condition of the loan. and a national policy on pharmaceuticals that includes measures for ensuring safety, efficacy, and drug quality.

8 World Bank Health, Nutrition and Population (HNP) Briefs on Pharmaceuticals Governments should encourage the development of marker technologies to track pharmaceuticals through the supply chain and identify fake products. (HNP Brief #2, March 2005) streamlining logistics and introducing modern tracking technology should be a policy objective for the public as well as the private sector. Relatively inexpensive and simple technology solutions exist and may even be applied in a given country already in another sector, for example for branded food and beverage products or other fast moving retail items. Costs for the necessary hard- and software have come down significantly. (HNP Brief #6, July 2005)

9 III. Product and supply chain integrity Product integrity Supply chain integrity Recent initiatives in the pharmaceutical sector

10 R&D AND INNOVATION AT SICPA Recognizing that R&D and innovation are critical drivers to technical enhancements, customer satisfaction and business growth, SICPA continuously invests in its core and in new technology fields, with the aim to deliver the most secure and robust product and supply chain integrity solutions.

11 MULTI-LEVEL COMPETENCIES FOR MULTI-LEVEL PRODUCT AND SUPPLY CHAIN INTEGRITY SOLUTIONS Information-based integrity (data, events and transactions) Business Intelligence Data integrity and communication security Data or event management Authentication equipment and dedicated scanners Coding and serialization / activation and code capture Material-based integrity Overt or covert security inks, labels, devices, laser marking Overt, semi-covert, covert and forensic security elements Product Analysis, Product Marking

12 PRODUCT AND SUPPLY CHAIN INTEGRITY

13 SAFE AND SECURE SUPPLY CHAIN REFERENCE MODEL Safe and secure supply chain Reference model Product integrity Authentication Is the product genuine? Is it the right product? Supply Chain integrity Pedigree Is the chain of custody intact? Product identity Physical features Track Trace Is the code associated with the unit of sale valid? Does unit of sale have expected authentication attributes? Where is the product and where is it headed? Where was the product? (locations and custodians)

14 PRODUCT INTEGRITY

15 SAFE AND SECURE SUPPLY CHAIN: PRODUCT INTEGRITY Safe and secure supply chain Reference model Product integrity Authentication Is the product genuine? Is it the right product? Supply Chain integrity Pedigree Is the chain of custody intact? Product identity Physical features Track Trace Is the code associated Does unit of sale have Where is the product Where was the product? with the unit of expected authentication and where is it headed? (locations and sale valid? attributes? custodians)

16 SAFE AND SECURE SUPPLY CHAIN FIRST STEP - PRODUCT INTEGRITY Product identity Is the code associated with the unit of sale valid? Product integrity Authentication Is the product genuine? Is it the right product? Physical features Does unit of sale have expected authentication attributes? Product Protection Physico-chemical analysis Biometry Product tagging/marking Packaging Protection Authentication (material or graphical) integrated to packaging artwork or via labels or stamps. Tamper-evidence Product identification 1D or 2D barcodes RFID Proprietary technologies

17 SUPPLY CHAIN INTEGRITY

18 SAFE AND SECURE SUPPLY CHAIN SUPPLY CHAIN INTEGRITY Safe and secure supply chain Reference model Product integrity Authentication Is the product genuine? Is it the right product? Supply Chain integrity Pedigree Is the chain of custody intact? Product identity Physical features Track Trace Is the code associated Does unit of sale have Where is the product Where was the product? with the unit of expected authentication and where is it headed? (locations and sale valid? attributes? Counterfeit Medicines: Enforcement and Technical Solutions (SICPA SA) custodians) 2 nd -3 rd October 2012

19 SAFE AND SECURE SUPPLY CHAIN: SUPPLY CHAIN INTEGRITY Tracking products at item level capturing data/events along the product s chain of custody Ensuring data integrity Data accuracy Data synchronisation/reconciliation Data security Creating alerts/alarms business rules Coherence checks Notifications Tracing back histories Supply Chain integrity Pedigree Is the chain of custody intact? Track Where is the product and where is it headed? Trace Where was the product? (locations and custodians)

20 RECENT INITIATIVES IN THE PHARMACEUTICAL SECTOR

21 RECENT INITIATIVES IN THE PHARMACEUTICAL SECTOR Recent initiatives throughout the world Mainly triggered by regulations or public private partnerships To address counterfeiting and illicit trade issues To address reimbursement fraud issues To ensure patient and consumer safety To ensure and enforce IP rights Examples of countries where such initiatives have been launched The US (California and federal), the EU, China, India, Argentina, Turkey, Brazil, south Korea, Nigeria, Ghana, Kenya, Albania

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28 SICPA AS A PARTNER End-to-end integration Risk management Planning and resources capacity Project management Worldwide support and maintenance services The company Expertise in combining multi-purpose solutions Proven experience in secured traceability systems design, development and deployment Governance stability and focused business Solid financial position and continuous investments in R&D efforts

29 IV. SICPA Pharmaceutical products Project with the Government of Albania

30 Finding ways to ensure the most cost efficient, safe and efficacious drug supply is a primary goal in health system reform and modernization.(recommendations include measures to) Track drugs from producer to patient. Install a pedigree requirement or other system to track who has possession of drugs from producer to patient. IMPROVING TRANSPARENCY IN THE PHARMACEUTICAL SECTOR:REPORT ON THE STUDY TO IDENTIFY AND STRENGTHEN DECISION POINTS AGAINST CORRUPTION. Albania Development Policy (2007), Professor Michele Forzley

31 ISSUES ALBANIA PHARMA PROJECT ISSUES AND OBJECTIVES Uncontrolled import, distribution and sale of medicines Counterfeit medicines Uncontrolled medicine price raises impacting the costs of healthcare Medicines might move from subsidized channels towards retail channels Products may be sold by the unit and pharmacists may request reimbursement of medicines multiple times Medicines might not be declared and in these cases taxes are generally not paid OBJECTIVES Securely identify the authorized products Allow for the control by inspectors of the status and legality of any box at any stage of its distribution or sales process Visibly identify the intended distribution channel of the medicine Provide the patient with a control mark to authenticate and verify, providing the reference sales price Phase 2: Implement a feature to enable controls such that any box gets reimbursed only once by social security

32 ALBANIA PHARMACEUTICAL CONTROL MARK 1. Original Mark 2. New Mark Phase 1 3. New Mark Phase 2 INVISIBLESICPADATA CODE Product description dosage SALESPRICE Channel XXXXXXXXXXXX Product description / dosage SALESPRICE XXX XXX XXX XXX PEEL-OFF AND TO APPLYON RECIPE SICPA OASIS STAYSON BOX OVERT FEATURE VISIBLEHR REFERENCECODE INVISIBLE SICP

33 MAIN STEPS OF THE OVERALL PROCESS 1. Printing and invisible coding of Pharma control stamp 2. Personalization of the stamp for the product 3. Distribution of the stamp for its application on medicines 4. Check by the inspector and authorization 5. Validation by the inspector and authorization / release to sale 6. Field inspections by inspectors in pharmacies 7. PHASE 2 ONLY: Pharmacists remove peel-off stamps and apply them to the corresponding prescription, to be sent for reimbursement 8. PHASE 2 ONLY: Social Security validates medicine using internet page and reimburse it

34 PHARMA PROCESS FLOW Access to MINISTRY Access to ordering & reporting NCDC NCDC Auditors SICPAMOBILE MoH 4. Inspection 5. Inspection 6. Inspection 1. Printing 2. Coding 3. Personalization At Customs or importers Application by manufacturers Open or closed market Product Product Price Product Product Price