IP TSAR Targets Fake Drugs

Increased efforts to curb online distribution of counterfeit drugs led to the seizure of 2.3 million counterfeit pills last year, according to a report from the so-called US IP tsar.

The report, released earlier this month by US Intellectual Property Enforcement Coordinator (IPEC) Victoria Espinel, said that coordinated enforcement with foreign governments led to more investigations and arrests.
In one joint effort with Mexico, dubbed Operation Safe Summer,US agencies targeted health and safety items smuggled through mail and courier facilities, seizing more than 300 tons of counterfeit goods in Mexico and more than $23 million worth of goods in the US.

In addition to targeting mail and express shipments, the initiatives focused on illegal internet pharmacies and resulted in nearly 300 websites taken down worldwide. “Criminal laws and IP laws that apply in the physical world are based on a tradition of rules, checks and balances that must be applied to and tailored to the digital world,” the report said. A MarkMonitor study released in January found that 26 sites identified to have sold counterfeit prescription drugs generated combined traffic of 51 million visits. Those sites typically offered generic versions of prescription drugs not sold as generics in the US.

The office of the IPEC’s annual report further highlighted proposed legislative changes it will submit to Congress, including providing relief from seizures, penalties and other enforcement actions for anyone who unknowingly and unintentionally acquires counterfeit goods and reports them to Customs and Border Protection (CBP).
Espinel also plans to submit a proposal granting CBP the ability to administer penalties in addition to its role of seizing and forfeiting infringing exports. In doing so, the US government could better advocate for other countries to impose their own penalties for counterfeit goods imported to the US, she wrote.

The Office encouraged the private sector to police their sites, with companies such as Google, Yahoo! and American Express set to form a nonprofit organisation dedicated to education and enforcement.
“This first-of-its-kind effort will have a dramatic impact on combating illegal online pharmacies and send an important signal to governments and the global marketplace that we will combine aggressive enforcement with voluntary private sector action,” said Espinel.

The coalition supports the expansion of the National Association of Boards of Pharmacies’ Verified Internet Pharmacy Practice Sites list, which is essentially a white list of legitimate online pharmacies. Its members also have agreed to share information about illicit online pharmacies with law enforcement as well, potentially shutting down infringing sites.
Google and others already have blocked advertising on illegal internet pharmacies, while MasterCard halted services from peer-to-peer site Limewire.
While IPEC has gained ground with major corporations, there has been opposition from some technology stakeholders regarding the extent to which the administration and companies will go in shutting off services.
A December 17 entry on the Techdirt blog said that while illegal internet pharmacies are a “serious problem”, the IPEC and US authorities “lump in the (quite common) grey market pharmacies as well – which often allow people to get drugs from outside the country at much more affordable rates”.

The author added: “Shutting down fake drug sellers is fine. Shutting down the grey market drug sellers is a bit of a bigger issue.”
The Computer & Communications Industry Association (CCIA) last year expressed uncertainty about IPEC’s intent to review and amend US IP laws. However, CCIA’s vice president of law and policy, Matthew Schruers, deemed increased enforcement targeting fake drugs “encouraging”.

In another example of the administration bolstering IP enforcement efforts, President Obama last week established two White House IP enforcement advisory committees, including a senior IP advisory committee composed of cabinet level officers. Espinel will chair both committees.

Source: Managing Intellectual Property

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