Illegal Trafficking of Prescription Drugs: More Akin to Assault or Attempted/Negligent Homicide Than Simple Theft

Dr. Bryan Liang is a physician, a PhD, and a lawyer. As professor of law and executive director of the Institute of Health Law Studies at California Western School of Law here in San Diego, he has tackled many of this nation’s top health safety concerns where medicine and law meet. Over the years, at his annual spring “roundtable” conference on Harbor Island, he has brought to light the important subjects of counterfeit drugs, counterfeit biologics, healthcare safety/security/terrorism, and the complex world of espionage and product safety as it applies to “Big Pharma.”

At this year’s March 26 6th Annual Institute of Health Law Studies Conference, the topic was the illegal trafficking of prescription drugs. In an age where healthcare costs (and the relative scarcity of health system resources) is under intense scrutiny, the scheme of prescription drug trafficking is especially interesting, telling, and concerning. The criminal activity can be complicated but often involves Medicaid and Medicare patients, local community pharmacies and supermarket pharmacy chains, drug runners, small-time “mob bosses,” drug wholesalers, and check-cashing stores.

Without the knowledge of the doctors who prescribe the drugs, stolen or “bought” merchandise — at pennies on the dollar to poor patients, or those posing as patients — or otherwise legitimate drugs are picked up at real pharmacies and then diverted and sold back to pharmaceutical outlets on the secondary market. According to the speakers at the conference, some of whom were undercover agents working for the pharmaceutical industry and state health inspectors in Florida (the national epicenter of such illegal activity), the trafficking of prescription drugs is a multibillion-dollar industry annually in United States. Some of the speakers and audience members were still active in law enforcement and working at the state and national levels. Not unexpectedly, the health insurance industry was represented as it also has a stake in the fight against this underground prescription drug diversion. In this crime syndicate, health insurers find themselves literally paying for the same item of medicine many times over.

Here’s how the scheme works: Criminals first obtain possession of the real prescription medications through various means (usually paying patients for their newly acquired prescriptions, using forged prescriptions, raiding pharmacies, or staging large-scale operations to clean out entire drug storage facilities); then, they repackage the drugs to remove any trace that the medicine has been issued to a particular patient or warehouse facility. The drugs are then relabeled through a very sophisticated process that, in the end, makes it very difficult to distinguish the stolen/diverted drug from the original, “real thing.” In some instances, drugs are diluted, tampered with, or even replaced with placebo-type substitutes that are not detected unless an end-user patient complains about not responding properly to their medication.

On a government and public safety level, the problem could not be more pressing. Patients suffer from this type of despicable scheme because their medicines may be fake or impure, and lawmakers and government officials are usually ill-informed and under-motivated to ramp up efforts to stop the cycle of corruption. Some policeman speaking at the conference revealed that they were just not trained to pick up on this unique type of crime. They related that if most cops were to stop a car filled with $2,000 worth of marijuana, they would immediately take action and know what to do. In contrast, they reported real cases of cars being stopped with $200,000 worth of stolen or repackaged prescription medicines that were unknowingly allowed to proceed without intervention by the police. The societal problem at stake also involves the U.S. court system. In the vast majority of cases, judges need educating that this type of crime is more akin to assault or attempted/negligent homicide than simple theft.

Many of the prescription medicines being diverted are also among the most expensive drugs on the market, ranging from anti-virals to cancer drugs to insulin. Abuse, diversion, and tampering with these medicines can be extremely dangerous and even deadly for patients.

A grand jury in Florida in 2003 brought this problem to the attention of state legislators, and stricter licensing and operating mechanisms were put into place for prescription drug wholesalers. This did make a difference in the amount of illegal, repackaged drugs making their way back to the secondary prescription drug market. To illustrate this point, the number of licensed drug wholesalers in Florida over the past seven years has dropped from 432 to 129. States like California could potentially have an even greater long-term problem with the illegal trafficking of prescription drugs, but educating the law enforcement system and courts will prove formidable, and lags far behind where it should be to optimally protect innocent patients. Hopefully, with the persistent efforts of Dr. Liang and others, creative solutions will be found to minimize healthcare theft and fraud, and save lives.