Increased illicit behavior on Internet pharmacies

Of the nearly 7,000 sites reviewed by the National Association of Boards of Pharmacy, only 4% of those online sites appear to be in compliance with pharmacy laws and practice standards.

OpSec performed a trend analysis based on the pricing of prescription drugs in rogue online pharmacies since 2007. During this period, the percentage of drugs with discounts of 40% or more increased from 42% of drugs offered in 2007 to 86% in 2010. This doubling of deeply discounted drugs is a key indicator that an increasing amount of counterfeit drugs are being sold.

The exception to these markdowns is the lower discounting of popular controlled substances. For example, the average discount from retail is 19% for Schedule II drugs sold online. The higher market value for these heavily regulated substances remains consistent in the online space, where discounts are limited for drugs with a high street value.

  • 86% of unaccredited online pharmacies offer drugs with discounts of 40% or more, up from 42% in 2007
  • 89% of unaccredited online pharmacies do not require a prescription, up from 51% in 2007
  • 79% of unaccredited online pharmacies have U.S. site registrations, up from 55% in 2009. Although this may seem like a positive trend, it is offset by the rise in use of identity masking services based in the U.S., and also the use of blatantly false information, such as celebrity names as registrants
  • Increasing number of B2B trade board sellers are positioning themselves as drop shippers or order fulfillment centers for Internet pharmacies
  • 60% annual increase in trade board listings of prescription drugs and APIs for sale on B2B platforms
  • Significantly expanded drug and API portfolios from manufacturers and distributors in China and India selling on B2B trade boards
  • 50% annual increase in listings from trade board sellers outside of China and India, mostly from Eastern Europe, Malaysia, and Turkey.

Site registration at a host location outside of the U.S. or use of a masked registration to maintain anonymity is a classic marker for identifying a rogue Internet pharmacy. The OpSec study showed a significant rise in ICANN registrations of Internet pharmacies hosted in the U.S., a movement from 55% in 2009 to 79% in 2010.

However, this positive trend is misleading because of the growing use of domain proxy services to block the identity of site operators and to list their location in the U.S. Rogue pharmacies are also hiding their identity by using blatantly false information, such as celebrity or false names as the registrant.

In addition, although a site may be registered in the U.S., their drugs may still be sourced from a drop shipper outside of the U.S., which may not adhere to FDA safety regulations.

OpSec’s research has shown that retail site operators often source products from B2B trade boards. The OpSec study uncovered multiple B2B sellers positioning themselves as a drop shipper or order fulfillment center for Internet pharmacies targeting patient populations in the European Union, U.S., Israel, Japan, Brazil, and Australia.

In such a relationship, a rogue pharmacy accepts online orders for pharmaceuticals from patients, and the drop shipper actually ships product to customers.

In one analysis, OpSec uncovered a number of B2B sellers acting as drop shippers to fulfill orders for a single marketing affiliate network consisting of more than 400 storefronts worldwide. In this case, orders were fulfilled in India.

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Increased illicit behavior on Internet pharmacies