Skip to main content
SearchLogin or Signup

Preliminary Investigation of Pharmaceutical Counterfeiters in the United States

Published onOct 01, 2018
Preliminary Investigation of Pharmaceutical Counterfeiters in the United States
·

Abstract

Pharmaceutical counterfeiting is one of the most pressing public health concerns in the United States and abroad, and recently an increasing amount of scholarly attention has been given to this issue. However, the extant literature lacks a systematic investigation of the specific roles undertaken within pharmaceutical counterfeiting schemes. We attempt to address this knowledge gap through an analysis of individuals convicted in federal court of counterfeiting offenses related to U.S.-based pharmaceutical counterfeiting incidents. From our investigation we identified six distinct roles that can classify an individual’s involvement in a pharmaceutical counterfeiting scheme: Key/Lead, Supporting, Sales/Distribution to Legitimate Others, Sales/Distribution to Illegitimate Others, Production, and Purchase. Through an examination of these roles and their distinct characteristics we propose several role-related crime prevention strategies. Additionally, we discuss the broader implications of our work for the study of pharmaceutical counterfeiting and identify directions for future research.

Introduction

Across the globe, counterfeit pharmaceuticals have led to millions of deaths and created a wide range of health and safety risks for millions of people (Catizone, 2006; Cockburn et al., 2005; Harris, Stevens, & Morris, 2009; Hoseini et al., 2011; International Intellectual Property Institute, 2003; Qureshi et al., 2011; Yar, 2008). Numerous types of products are exploited by pharmaceutical counterfeiters, including lifestyle drugs such as Viagra® and Cialis®, as well as life-saving drugs such as medications used in the treatment of cancer and AIDS. While recent years have seen an increase in research and scholarship addressing pharmaceutical counterfeiting and ways to prevent its proliferation (Kennedy, Haberman & Wilson, 2016; Lavorgna, 2015), there has been little research directly exploring the individuals involved in these schemes.

Work by Spink and his colleagues (2010; 2013) has attempted to draw together a general typology of product counterfeiters, yet, these works treat all counterfeiting schemes as the same. When viewed through the lens of criminal opportunity theories (Clarke, 1997; Cohen & Felson, 1979), such an assumption seems misguided as the elements of counterfeiting schemes likely vary by the product being counterfeited. While some counterfeiting roles are likely to be found in almost all schemes, certain roles may be more important for particular types of schemes. To date, there has been no direct research seeking to systematically investigate and subsequently categorize the specific roles individuals undertake as part of a pharmaceutical counterfeiting scheme. We attempt to fill this gap by articulating a typology of pharmaceutical counterfeiting roles.

The identification and classification of pharmaceutical counterfeiting scheme roles is an important and necessary step in understanding the opportunity structure for these crimes because it allows us to gain an understanding of who is responsible for specific parts of the criminal scheme. Currently, we label all individuals involved with these schemes with the general term "counterfeiter," which may be an inappropriate overgeneralization. It is highly unlikely that the individuals involved in these schemes are generalists who perform all aspects of all necessary roles. The sophistication of many pharmaceutical counterfeiting schemes necessitates the involvement of multiple individuals as in some cases it is extremely difficult for one person to handle the manufacturing, distribution, and sales of a counterfeit drug.

Using the current designation, we would find that in any one pharmaceutical counterfeiting scheme there may be hundreds of “counterfeiters” all with important and necessary roles in that scheme. While these roles are necessarily related, using one common term to describe each of them likely masks many of the important role-based differences that exist. Furthermore, using a single descriptor for the individuals involved in these schemes may end up masking important differences in the individuals involved in pharmaceutical counterfeiting schemes. Having a better understanding of the unique roles undertaken in pharmaceutical counterfeiting schemes allows for the development of more targeted situational responses (Clarke, 1980).

This article examines the characteristics and activities of individuals involved in pharmaceutical counterfeiting schemes occurring within the United States and uncovered by federal and state authorities from 2000 to 2008. Our aim was to develop a better understanding of the offender roles most commonly found in pharmaceutical counterfeiting schemes and to identify unique features of these roles that can be leveraged when developing situationally-appropriate responses. We accomplished this aim through an exploration of the individuals involved in pharmaceutical counterfeiting schemes, the roles these individuals played in their respective schemes, and by developing an understanding of how these roles are interrelated and at times overlapping.

Pharmaceutical counterfeiting

Pharmaceutical counterfeiting schemes are a harmful and dangerous form of product counterfeiting, which is a crime that involves the unauthorized production of a product bearing the trademark of a legitimate good. The use of a recognized trademark by an unauthorized party is a violation of the brand owner's intellectual property rights and is punishable by the federal government under intellectual property rights laws. According to several governmental and non-governmental organizations (Business Action to Stop Counterfeiting and Piracy, 2011; International Anti-Counterfeiting Coalition, 2005; U.S. Government Accountability Office, 2010), counterfeiting costs consumers, businesses, and governments several hundreds of billions of dollars each year. Beyond the costs of these crimes, pharmaceutical counterfeiting can create serious health problems for unsuspecting patients.

Counterfeit goods are typically described as either deceptive or non-deceptive (Grossman & Shapiro, 1988). Deceptive counterfeits attempt to fool consumers into purchasing a phony product that appears to be legitimate, while non-deceptive counterfeits are often produced to meet consumer demand for look-alike products. Counterfeit pharmaceuticals are deceptive counterfeits, as counterfeiters are directly targeting consumers who are in search of legitimate pharmaceutical products. The range of goods that have been counterfeited is vast and includes clothing, jewelry, personal care items like shampoo and lotion, components used in automotive and aircraft manufacturing, and luxury goods such as watches and purses. Unfortunately, the products that have the potential to cause the most harm to consumers and society are counterfeit pharmaceuticals.

Counterfeit pharmaceuticals

Counterfeit goods do not always create health and safety concerns for consumers. However, many counterfeit products do have the potential to threaten consumers' lives, particularly when these products are made with ineffective or harmful substitute materials, or are produced through sub-standard manufacturing processes. A number of different activities constitute pharmaceutical counterfeiting, such as altering the labeling or packaging of legitimate products so that they no longer reflect what is actually in the package, diluting legitimate pharmaceuticals to be less potent, and the creation of completely fake drugs that contain little to no active ingredients. In each case, counterfeit pharmaceuticals have reduced, or non-existent, medicinal qualities and are not likely to function in the manner expected by patients or physicians (Bunker, 2007; Yar, 2008).

Consumers likely do not expect being deceived and have no way of knowing or determining the authenticity of the pharmaceutical products they consume. Because counterfeits mimic legitimate drugs in appearance, and because consumers inherently trust the legitimacy of the pharmaceutical products they consume, the potential for patient harm from counterfeit pharmaceuticals is great. For example, by some estimates as many as 700,000 people die each year from malaria and tuberculosis because they have taken ineffective counterfeit vaccinations (Harris, Stevens & Morris, 2009).

It is likely that people living in impoverished conditions with a lack of access to modern medical infrastructure are those most likely to be impacted by the counterfeit drug trade (Newton et al., 2006). However, work by Trent (2013) suggests that regardless of one's economic status or wealth, the very young and the elderly are most likely to suffer the harmful effects of counterfeit medications. At the same time, the consumerism found in more affluent societies, such as the United States, fuels a multitude of additional opportunities for pharmaceutical counterfeiters. This is particularly true when it comes to demand for cosmetic or lifestyle pharmaceuticals such as Botox® or Viagra®.

Whether the drug is intended to save a life or simply enhance one's lifestyle, when a counterfeit leads to negative side-effects, ineffectiveness, and patient injury it may be concluded that there is something wrong with the legitimate drug (Caudron et al., 2008; Kelesidis et al., 2007; Newton, Green & Fernández, 2010). As a result, counterfeit pharmaceuticals pose a direct threat to the individuals that consume these illicit goods, but they also harm potential future patients who would receive legitimate drugs. Associating a counterfeit pharmaceutical's negative characteristics with a legitimate pharmaceutical may lead doctors to refrain from issuing the drug, and may even lead to drug recalls or legal suits against the drug maker. As a result, the chain of harm that results from the growth of product counterfeiting reaches well beyond the end consumer who was initially harmed by the counterfeit product, ultimately touching future consumers, physicians, pharmaceutical companies, and society at large.

Counterfeiters

Early stages of the study of unique forms of crime frequently include attempts to assess what the criminal offenders engaged in that particular crime look like. For example, the delineation of who the white-collar offender was became one of Sutherland's (1940) greatest contributions to the field; it also became the subject of much scholarly debate (Burgess, 1950; Hartung, 1950; Sutherland, 1945; Tappan, 1947). While offender-based definitions of white-collar crime appear to have lost their influence, the recognition that there was something inherently unique about these offenders was critical for the development of white-collar crime scholarship.

Similarly, cybercrime research has acknowledged the usefulness of developing an accurate profile of the cybercriminal (Nykodym, Taylor & Vilela, 2005; Rogers, 2003), particularly when cyber attacks originate from within an organization or group (Shaw, 2006). Understanding how characteristics of cybercriminals relate to the type of cybercrime being committed can help law enforcement agencies become more efficient at detecting and apprehending these individuals (Chakravarthy, 2014). Because there are many different activities that need to happen in order for a pharmaceutical counterfeiting scheme to be successful (Kennedy, Haberman & Wilson, 2016), identifying the roles most commonly found in these schemes, as well as any unique characteristics of the individuals who occupy these roles is important to future crime prevention efforts.

Counterfeiters are successful in their crimes, in part, because they are able to create efficient organizations where the criminal workload is shared. For pharmaceutical counterfeiting to be successful, multiple people must be involved in the manufacturing, packaging, shipping, and distribution of counterfeit goods. There are likely few ‘lone wolves’ or solitary offenders searching the environment for someone to victimize. Rather, many counterfeiters are highly organized and collaborative, and the growth of counterfeiting across the globe has increased the need for organization and the coordination of activities related to counterfeiting schemes. As a result, the term 'counterfeiter' can be used to describe any number of individuals involved in various counterfeiting operations, and it is unlikely that a single profile appropriately captures all counterfeiter roles.

Methods

Data

The data used in this study came from a product counterfeiting incident database developed and maintained by the Center for Anti-Counterfeiting and Product Protection (A-CAPP) at Michigan State University. This database is a collection of incident-level data gathered from open-source materials related to product counterfeiting schemes occurring within the United States between 2000 and 2008. Information regarding the processes used to develop this database can be found in Heinonen and Wilson (2012). From this data set, we first selected any cases that were related to pharmaceutical counterfeiting. Once all of the pharmaceutical incidents were identified, the data set was further reduced to include only those cases where the drugs involved in the scheme were prescription pharmaceuticals.

It may be the case that the type of pharmaceutical product counterfeited (e.g., vitamins, supplements, diabetic test strips, prescription drugs, etc.) significantly affects the structure of the scheme, as well as the roles undertaken by individuals involved in the scheme. We selected only those cases involving a prescription pharmaceutical to create a parsimonious typology, and because these are the most heavily regulated pharmaceutical products available to consumers. However, the role categorizations we develop may overlap conceptually with the roles found in schemes relating to other pharmaceutical products. As such, the typology we develop may serve as a useful benchmark for the development of other counterfeiter typologies.

Finally, we examined only those cases where an individual was convicted of a counterfeiting offense. While previous studies have explored the specific incidents contained within the database (Heinonen & Wilson, 2012; Kennedy, Haberman & Wilson, 2016), our study intended to explore the roles undertaken by pharmaceutical counterfeiters. As such, our study was focused on 156 individuals convicted of pharmaceutical counterfeiting offenses in the United States.

Analysis strategy

Because we intended to identify previously undefined roles commonly found within pharmaceutical counterfeiting schemes, we followed the spirit of qualitative content analysis and reviewed the data for emergent role-based categories or themes (Glaser & Strauss, 1967; Miles & Huberman, 1994). Following a process outlined by Aksulu and Wade (2010), the first and second author engaged in an iterative and structured process of coding, interpretation, and re-coding to arrive at the final role designations. We deviated slightly from the process used by Aksulu and Wade by utilizing a short list of pre-identified roles to guide our initial searches. However, as the analysis proceeded, these categories grew, evolved, and changed in accordance with the emergence of important themes found within the data (Glaser & Strauss, 1967).

The first step in the coding process was to examine all information gathered about a particular scheme for information that might indicate as to the specific roles found in that scheme. We were looking to identify any relevant and important information about an individual's particular activities that were directly related to the furtherance of the scheme. From this information descriptive codes, or short collections of data summarizing the role, were created; a total of 20 initial descriptive codes were identified. Once all of the descriptive codes were collected, we moved to the process of interpretive coding, where codes were refined into standardized parent codes and sub-codes. Saturation (the point where no new codes emerged) was reached when approximately 70% of the interpretive coding process was completed.

Once the interpretive step concluded, we organized the codes into patterns, condensing similar codes to remove redundancy. This process of pattern coding was a back-and-forth process where the first and second author independently coded the information relevant to each identified role and discussed any disagreements to reach a consensus regarding the appropriate role code. The authors had 78.5% agreement in their initial independent coding; disagreements were easily resolved and helped to facilitate refinement of the final codes.

Once pattern coding was completed, a total of six codes were identified: Key/Lead, Supporting, Sales/Distribution to Legitimate Others, Sales/Distribution to Illegitimate Others, Production, and Purchase. The final stage in the coding process was the independent assessment of the codes by individuals unaffiliated with the study. Three graduate students were given a series of statements (18 in total, three from each of the six categories identified by the authors) drawn directly from the raw data files, as well as descriptions of the six role codes identified through the pattern coding process.

The students were asked to read each statement and assign a role code to each. Students were allowed to list as many codes as they felt appropriate, and were given the opportunity to create new codes if they thought that none of the codes the authors provided appropriately fit the data; no new codes were suggested. Reliability was assessed by comparing the primary code assigned to each statement by the independent coders to the code assigned to the statement by the authors. There were a total of 12 coding disagreements out of a possible 54 coder-author pairings. However, when considering all additional codes the independent coders assigned to the statements, the number of clear disagreements dropped to 6; there were no statements where all three independent coders had clear disagreements with the authors' coding of the statement.

A Krippendorff's alpha was calculated to assess inter-coder reliability among the coders alone, and then among the coders and the authors. Krippendorff's alpha is a robust measure of reliability that ranges from 0.000 (the absence of reliability) to 1.000 (perfect reliability) that is well suited for content analyses, particularly when multiple coders are involved (Hayes & Krippendorff, 2007). An assessment of the independent coder's inter-coder reliability produced a Krippendorff's alpha of .82, while an analysis of all coders (authors and independent coders) produced a Krippendorff's alpha of .78. When the six clear disagreements are left out of the analysis the Krippendorff's alpha comparing coding across all coders increases to .88. Thus, we have confidence in the reliability of the coding scheme developed during the pattern coding process. Examples of descriptive statements used in the coding process and the descriptive statistics for each role code are displayed in Tables 1 and 2, respectively.


Table 1. Descriptive information from offender source files


Table 2. Descriptive statistics for role codes


Throughout the presentation of results, we use descriptive statistics to describe relationships found within the data. However, given the nature of the sample and the purposes of the study, we avoid entering into any inferential analyses that would lead us to make predictive claims about pharmaceutical counterfeiters and their crimes; we leave these processes to later research. Instead, we place our results within a dialogue intended to describe a particular class of criminal that has yet to be empirically analyzed, with the goal of identifying important characteristics that can be useful in later studies of pharmaceutical counterfeiting schemes.

Findings

A brief note about the incidents

There were 63 pharmaceutical counterfeiting schemes examined. As mentioned above, product counterfeiting is a global problem that crosses international borders and allows criminals to victimize consumers all over the world. Reflecting this fact, just over half of the schemes we examined (52.4 percent, n=33) had an identifiable international component. Of the remaining 30 schemes, ten (15.9 percent), were national in scope; another 20 (31.7 percent) occurred at the state or local level. We do not believe that these findings imply that the pharmaceutical schemes conducted at the local- or national-level do not have an international component, rather the data made no mention of any international connections. Despite the large presence of international schemes, the majority of schemes were relatively small in terms of the number of individuals involved, as 58.7 percent (n=37) involved three or fewer people. However, the fact that 17.5 percent of schemes involved more than ten convicted individuals underscores the reality that counterfeiting schemes can be quite large and complex.

For many schemes, the extent of victimization is unclear as 77.8 percent of cases (n=49) provided no information on the number of victims impacted by the scheme. When data were available on the number of victims, three schemes with between 25 and 50 identified victims and another 11 schemes with more than 50 victims were found. A large percentage of schemes (41.3 percent, n=26) were conducted through a healthcare provider such as a doctor's office, physical (non-internet based) pharmacy, assisted living facility, or some other licensed healthcare entity. These schemes were more likely to be conducted at the local level, while schemes based around internet pharmacies were more likely to have an identified international component (χ2 [6, n=63] = 24.199, p<.000).

Scheme roles

The individuals involved with the schemes we examined occupied a number of different roles across the various schemes, roles which were differentiated by the types of activities undertaken. Because an individual could be involved in a number of different activities in any one scheme, we assigned both primary and secondary role codes to individuals where appropriate.

Key/lead

Individuals assigned the role code of Key/Lead were the originator of their respective counterfeiting scheme, the main person leading counterfeiting operations, or the sole individual involved in the scheme. A total of 27 individuals (17.3 percent) were assigned this code as their primary counterfeiting role; because of the nature of the activities affiliated with this code, it was never assigned as a secondary role. The following are excerpts from the data describing the activities of individuals coded Key/Lead:

Mark Anthony Kolowich was sentenced in federal district court in San Diego for his role in operating one of the largest Internet pharmacy schemes ever prosecuted. Kolowich, the owner of World Express Rx, pled guilty to conspiring  to sell counterfeit pharmaceuticals, commit mail fraud, smuggle pharmaceuticals, and conspiracy to launder money. In a related case in the Southern District of Florida, Kolowich pled guilty to conspiring to import unapproved drugs into the United States, introducing such drugs in interstate commerce, and smuggling unapproved drugs into the United States.

Niaja Kane, the subject of an OCI case, sent samples of medications to a counterfeit pharmaceutical manufacturer in China to be made on her behalf. After the counterfeit medication was created, it was then shipped back to her in the U.S. for eventual sale on the internet and other venues. Kane intentionally trafficked and attempted to traffic in goods, all of which were counterfeit, and knowingly used on and in connection with such goods counterfeit marks.

A ring that allegedly sold counterfeit and diluted prescription drugs to hospitals and pharmacies nationwide was broken up Monday with the arrests of 19 people in South Florida and Osceola County. Agents said drug wholesaler Michael Carlow headed the group that peddled tens of millions of dollars' worth of phony, expired, relabeled and watered-down medications, many used to treat serious illnesses such as cancer, AIDS and kidney failure.

Every counterfeiting scheme has an individual that is the Key/Lead for the scheme. This person typically coordinates the activities of multiple parties and guides the direction of the scheme. They may be the person to originate the scheme, but this is not clear from the data. For most individuals (67.95 percent, n=106) the counterfeiting scheme was not their primary occupation. However, individuals who were the key/lead of a scheme were more likely to have the counterfeiting scheme as their primary occupation (χ2 [10, n=156] = 29.942, p<.001).

Supporting

The most common primary role code assigned to the individuals we examined was that of Supporting. Offenders labeled with this code provided a range of services that were meant to support a counterfeiting scheme. Their activities included supplying materials such as raw ingredients and packaging products, organizing the mass distribution of spam emails and other online advertising, smuggling counterfeit pharmaceuticals into the country, assisting in some aspect of a scheme's operation such as maintaining an Internet website, or the theft of products that were then used in a counterfeiting scheme. Sixty-six individuals (42.3 percent) were assigned this label to describe their primary role in a scheme; an additional six individuals (3.8 percent) were assigned this code as a secondary role. The wide range of activities undertaken in support of pharmaceutical counterfeiting schemes was highlighted by the following statements:

Rounsborg [the defendant] did not take any steps to investigate or confirm that the Lipitor tablets received at [his company] for repackaging were authentic Lipitor intended for distribution in the United States, U.S. attorneys stated. As a result, Rounsborg conspired with others to continue repackaging product, even though on occasion Rounsborg was aware of facts that would indicate that some of the product he received may have been diverted.

In or about November 2002, Christopher Wayne Lamoreaux agreed with co-defendants to remove the drug Coumadin from blister packages marked “for hospital use only” and repackage the drugs in bulk plastic bottles that would disguise and conceal the fact that the Coumadin was “for hospital use only.” Between in or about November 2002 and March 2003, defendant agreed with co-defendants to repackage purported Bextra® and Lipitor®. On or about the dates listed below, co-defendants paid secret commissions and kickbacks to Christopher Wayne Lamoreaux.

Stuart Smith (a hospital employee) stole drugs from the University of Colorado, selling them to the operator of a counterfeit pharmaceutical ring. Smith entered a plea to a charge of the unlawful sale of drugs.

Co-defendant Joan Davis admitted in her guilty plea agreement that she aided and abetted another individual in operating an Internet business and in importing misbranded drugs from Germany into the U.S. through the use of false, forged, and fraudulent documents designed to deceive government employees.

Paul Kriger pleaded guilty on Jan. 26, 2007, to participating in a conspiracy to sell stolen pharmaceutical drugs. Kriger was the owner and operator of OTS Sales, Inc. (OTS), a California corporation engaged in the wholesale brokerage of prescription drugs in the secondary market on behalf of several co-defendants. In late December 2001 and early January 2002, OTS brokered the purchase of Imitrex, Advair, Flovent, and Flonase. Kriger was paid commissions of approximately $106,000 for brokering the purchase of the drugs.

In many ways, the individuals in Supporting roles are the most important people when it comes to the successful execution of a scheme. These are the people who do the heavy lifting, ensuring that schemes operate efficiently and effectively. As a result, the activities they undertake can be quite broad. One of the most important roles in these schemes is advertising, which involves any activities undertaken with the aim of securing customers. At times pharmaceutical counterfeiters enlisted the aid of professionals whose job it was to drive consumers into the counterfeiting scheme. In many of these instances advertisements for counterfeit pharmaceuticals were intermingled with advertisements for other products:

Oleg Nikolaenko … made hundreds of thousands of dollars by sending billions of spam emails advertising counterfeit Rolex watches, herbal remedies, and counterfeit prescription medications. The FBI said in the affidavit filed with the criminal complaint that they and investigators from the FTC were led to Nikolaenko as a result of investigations and arrests ... for trafficking in counterfeit watches and prescription medications. The investigation, in the U.S., Australia and New Zealand led to the MegaD botnet and Nikolaenko.

At other times, the advertisement of in-demand products was all that was needed to secure potential victims and could be completed by the scheme perpetrator themselves. This was common with doctors advertising products to consumers, with the following example being a typical scheme activity:

between January 2004 and February 2005, defendant ALBERT POET placed regular advertisements in local newspapers offering “Botox” treatments at his offices.

Sales/distribution to legitimate others

Individuals assigned the primary role code Sales/Distribution to Legitimate Others comprised 25.0 percent (n=39) of the individuals we examined. This code was assigned to individuals who sold counterfeits to legitimate entities, including consumers and legitimate wholesale or healthcare organizations not involved in the counterfeiting scheme. While a large percentage of individuals were assigned this code to summarize their primary scheme roles, an additional 45 individuals (28.8 percent) were assigned this code to describe their secondary roles in the scheme. This suggests that selling counterfeit goods likely goes hand in hand with other activities needed to pull off a counterfeiting scheme. The following statements showcase the actions of individuals who sold counterfeit pharmaceuticals to legitimate others:

According to court records, defendant Chad Livdahl and several co-defendants conspired to sell 3,081 vials, each containing five nanograms of Botulinum Toxin Type A and other ingredients, in a formulation designed to imitate Allergan's Botox® Cosmetic, to health care providers.

Ted S. Thalmann, owner and corporate secretary of The Medicine Shoppe of Edwardsville, pled guilty to a misdemeanor charge of misbranding of a drug. The charging documents indicate that prescription drugs were repackaged from the manufacturer’s original stock bottle and placed into blister packs labeled with incorrect expiration dates and supplied to area nursing homes from March 2007 through March 2008.

Thomas Martino ran wholesale pharmaceutical operations in Nevada and Utah and acted as a middleman distributing bogus medications from South Florida into the nation's mainstream drug supply, prosecutors said. Martino's company, Optia Medical, doctored paperwork to legitimize tens of millions in questionable epogen, Procrit and immune globulin, all expensive injectable drugs used by patients with cancer and HIV/AIDS, said Oscar Gelpi, an assistant attorney general who helped prosecute the case.

Frank Ianeillo admitted that he participated in a scheme to defraud the U.S. Food and Drug Administration by obstructing the lawful functions of the FDA to regulate the interstate sale and distribution of drugs and to safeguard the health and safety of consumers who purchase drugs. Ianeillo, a salesman involved in the legitimate secondary wholesale pharmaceutical market, made no effort to determine or verify the legitimacy, source, and origin of the drugs he purchased and then resold. Ianeillo also admitted that at times he sold drugs, he did not provide his buyer with any paperwork or other documentation to establish the legitimate source, origin, and bona fide nature of the drugs sold.

Sales/distribution to illegitimate others

Juxtaposing the large number of people involved in selling counterfeit drugs to legitimate others, only two individuals (1.3 percent) were assigned the code Sales/Distribution to Illegitimate Others as their primary scheme role, and only a further nine individuals (5.8 percent) were assigned this code to describe their secondary scheme activities. Individuals given this code sold counterfeits to other counterfeiting organizations, legitimate business owners seeking to sell counterfeit goods, and distributors of counterfeit goods. The following excerpts describe the actions of these individuals:

Girish Vishwanath is the director of exports for Benzo Chemical Industries, which is located in Bombay, India. He is charged with selling counterfeit Viagra pills to undercover federal agents. He is also charged with selling to undercover officers the items necessary to make counterfeit Viagra: a tablet punching machine, diamond-shaped dies, and the punches required to deboss the tablets with the Pfizer logo and "VGR 100" indicating the tablet's strength. The tablet punching machine, which stands approximately six feet tall and weighs about one ton, was purchased from Vishwanath for $11,000 and was shipped to the undercovers in Puerto Rico. Vishwanath is also charged with agreeing to provide undercover officers with powder or granules of sildenafil citrate, Viagra's active ingredient so that they could make their own counterfeit Viagra tablets.

Because Vishwanath's actions could also be classified as Production (which is described below) or Supporting these roles were assigned as secondary codes, yet his main actions involved selling counterfeit goods to unapproved parties. The description of Vishwanath's activities highlights the overlap that can be found in the activities of many people involved in pharmaceutical counterfeiting schemes. At times this overlap can make it difficult to determine what an individual's primary role in a scheme is, as the following description also highlights.

A Minnesota man who purchased hormones from Mason City partners to illegally sell to bodybuilders has pleaded guilty in U.S. District Court. Basil Han, 29, Andover, Minnesota, was convicted of conspiring with others to distribute human growth hormones for unauthorized uses, to traffic in counterfeit goods, and to defraud the Food and Drug Administration (FDA).

Han admitted at his plea hearing last week that he sold human growth hormones that were not going to be used to treat diseases or other recognized medical conditions, but rather for bodybuilding.

Production

Thirteen of the remaining individuals (8.3 percent) were assigned the code Production, as their primary role meaning they were involved with the production of counterfeit goods by producing/applying a false label to the product, manufacturing counterfeits, altering or diluting legitimate pharmaceuticals, or packaging counterfeits. An additional 14 individuals (8.9 percent) were assigned this code as a secondary role. This is the role that most aptly fits the definition of a counterfeiter, as these individuals are engaged in activities that would violate U.S. laws against the production of counterfeit goods.

Winhway Lee is the general manager of Tianjin Shuaike Chemical Co., a manufacturer and exporter of pharmaceutical products based in Tianjin, People's Republic of China. His company served as the main supplier of counterfeit Viagra to several persons based in Hong Kong. The product was then sold and exported to the US. Lee also provided counterfeit Viagra directly to an undercover agent who sought to purchase the drug for distribution in New York.

A pharmacist pleaded guilty on Tuesday to diluting cancer drugs destined for dozens of patients, saying he wanted to spare his victims the pain of a trial.

Robert Courtney has been held since August on 20 felony counts of product tampering, drug adulteration and drug misbranding, which carries a maximum penalty of 196 years in prison. The plea agreement calls for a sentence of between 17 and 30 years.

During meetings with undercover federal agents, Shengyang Zhou readily and repeatedly acknowledged that he was the manufacturer of counterfeit versions of Alli, a dietary supplement, being shipped to the United States. He discussed specific aspects of his counterfeiting activities regarding this product. Among other things, Zhou indicated that he did not put the lot number on the external packaging of the fake Alli product that he had previously manufactured. Zhou reported that he planned on producing an additional 5,000 boxes of the Alli product in his next batch which will appear the same as the authentic product.

Purchasing

Nine individuals (5.8 percent) were assigned the role code Purchasing, meaning the individual was responsible for purchasing counterfeit items for the scheme; three individuals (1.9 percent) were assigned Purchasing as a secondary scheme role. When an individual was assigned this role as a primary code, it meant they specialized in the sourcing or buying of counterfeit goods.

According to the facts filed with the court, for about three years before December 2009, Hughes began ordering large quantities of prescription and pharmaceutical drugs from sources in India and China without prescriptions for resale. Hughes is not licensed or authorized to sell and distribute prescription drugs and pharmaceuticals.

Masaru Yamasato was arrested following an investigation conducted by the United States Food and Drug Administration—Office of Criminal Investigations. Yamasato was charged in a criminal complaint with trafficking in counterfeit goods and sale of counterfeit drugs. According to the criminal complaint, Yamasato acknowledged that he and a partner purchased the drugs over the Internet from a source in China. The counterfeit drugs were then sold to a customer, who in turn sold the counterfeit drugs to individuals throughout Asia. Yamasato also voluntarily provided agents with documents showing that he purchased the counterfeit drugs from a source in China, Cherry Wong, who, according to the complaint, is a major supplier of counterfeit pharmaceuticals.

Jose Reynaldo Ortiz-Teran, the owner of Farmacia Sonora, was arrested in Arizona and indicted by a federal grand jury on charges of conspiracy, conspiracy to launder money and criminal forfeiture. The indictment alleges that Ortiz would obtain prescription pharmaceuticals without a prescription in Mexico and ship them to customers of the counterfeiting conspiracy via the mail.

A little under half of the individuals (44.9 percent, n=70) had more than one role in their counterfeiting schemes; when the counterfeiting scheme was an individual's primary occupation, they were more likely to have multiple roles within the scheme (χ2 [2, n=156] = 8.389, p<.05). It might be expected that schemes with fewer individuals would be more likely to have individuals occupying multiple roles; however this was not the case (χ2 [4, n=156] = 4.377, p=.357). In situations where an individual had only one identifiable role (55.1 percent, n=86), most held supporting roles (54.7 percent, n=47). Only six individuals (7.0 percent) who held a single role held the position of key/lead, while 21 individuals (30.0 percent) with multiple roles held the position of key/lead, which is more than any other role for individuals with multiple roles.

Additional information on pharmaceutical counterfeiters

Like many white-collar offenders, the individuals we examined did not have extensive criminal histories. In fact, of the 156 individuals, we examined only three (2.0 percent) had prior convictions for pharmaceutical counterfeiting. Each of these individuals had only one identifiable role in their respective schemes, with two of the three functioning as the key/lead for the scheme; the remaining individual was involved with product sales/distribution. The majority of the individuals involved in the counterfeiting schemes we examined were male (82.7 percent, n=129). The race of more than half of these individuals (58.9 percent) could not be identified, but where race was determinable, it was found that the majority (42.2 percent) were White.

Results of several chi-square tests of independence indicate that there were no significant differences in the number of roles (one role or multiple roles) across gender (χ2 [1, n=156] = .225, p=.635) or racial categories (χ2 [5, n=156] = 9.474, p=.092). The median year of birth was 1961, indicating that most individuals were in their late 40s to early 50s when they were engaged in their criminal schemes. Supporting this, we combined data on the year a counterfeiting scheme commenced and ended with the individual's year of birth to determine their approximate age at the beginning and end of the scheme. While the age at commencement varied from a low of 17 to a high of 68, the average age at the beginning of a counterfeiting scheme was 41.36. Age at the end of a scheme ranged from a low of 22 to a high of 71, with an average age of 43.48.Most individuals (71.2 percent, n=111) had no contact with victims as they were involved in schemes that operated through the internet or by mail, or because they were manufacturers or middlemen who only interacted with others involved with the counterfeiting scheme. The individuals most likely to have contact with victims worked in healthcare as a doctor, nurse, pharmacist, or in some other direct care capacity (χ2 [1, n=156] = 63.953, p<.000). Healthcare workers made up just over 21 percent (n=33) of the individuals involved in the schemes we examined.

Chi-square tests of independence also indicate that when counterfeiting was not an individual's primary occupation, they were more likely to receive a sentence of only probation (χ2 [6, n=156] = 14.185, p<.05). The individual's role in the scheme did not significantly affect their sentencing outcome (χ2 [15, n=156] = 24.510, p=.057). More than one-third (37.8 percent, n=59) of the individuals received a sentence consisting only of probation. Those sentenced to prison (n=97) were sentenced to an average of 55 months, although the median sentence was only 30 months, and sentences ranged from as little as a single month to a high of 468 months.  Almost 70 percent of the individuals (n=109) accepted a plea agreement, although the actual number of plea bargains may be higher as we were unable to determine whether or not plea agreements were reached in 19.2 percent (n=30) of cases. Individuals were more likely to take a plea bargain if they were involved in an international scheme (χ2 [3, n=126] = 17.324, p<.001). 

Discussion and conclusion

In this article, we examined the characteristics and activities of individuals involved in pharmaceutical counterfeiting schemes that occurred in the United States to develop an initial typology of unique pharmaceutical counterfeiting scheme roles. Through the development of this typology, we have taken a step towards understanding the elements needed to complete pharmaceutical counterfeiting schemes, as well as the unique individual activities that take place within these schemes. This understanding allows us to now make several situationally-appropriate crime prevention recommendations that focus on specific offender roles, rather than the general crime of pharmaceutical counterfeiting.

The individuals examined in our study were responsible for a wide range of activities from the origination and management of a pharmaceutical counterfeiting scheme, to the theft of products that later made their way into a counterfeit distribution ring. At several points, we felt it necessary to make qualitative distinctions among identified scheme roles even though the number of people assigned to these may have been low. In particular, we thought it necessary to make distinctions between individuals who sold pharmaceuticals to legitimate others, and those who sold pharmaceuticals to illegitimate others.

Role-based differences that exist between those who sell to legitimate others versus those who sell to illegitimate others are important, in part, because they can be used to explore how barriers to entry vary depending upon the legitimacy of the supply chain being accessed. For example, when counterfeit pharmaceuticals are sold to legitimate others, the counterfeit distributors employ methods intended to mask the illegitimate nature of their goods. The ability to place illegitimate goods into the legitimate pharmaceutical distribution stream obfuscates the illicit origin and nature of these goods and adds a veil of legitimacy to them (Benson & Simpson, 2015). Once these illicit drugs are distributed to other legitimate entities for use, healthcare providers become unwitting distribution points for the counterfeiters. Therefore, enhanced counterfeit detection methods and improved verification procedures are needed to make it more difficult for counterfeiting schemes to be successful.

One strategy that may prove very fruitful in increasing guardianship within the legitimate supply chain is the recently enacted Drug Supply Chain Security Act (Pub. L. 113-54), which mandates the serialization of all compounded pharmaceutical drugs and the tracking of these products from the point of manufacture to the point of dispense. In essence, this act creates a living record of the pharmaceutical's movements throughout the supply chain, a record that travels with the pharmaceutical as it moves from point to point in the system. This recordation system will make it difficult for counterfeiters to intermingle unauthorized pharmaceuticals into the legitimate supply chain, as they will not have the proper historical logs needed to assure their legitimacy. The use of sterilization techniques is also intended to increase substantially the level of difficulty faced by counterfeiters.

While the Drug Supply Chain Security Act is not perfect, for example recent developments in on-demand pharmaceutical manufacturing are not addressed by this act, it is a step in the right direction. The development and enhancement of situationally-appropriate guardianship and monitoring strategies aimed at increasing oversight within the legitimate supply chain is a necessary and on-going crime prevention activity. Yet, these strategies may do little to impact the distributors of counterfeit pharmaceuticals who are selling to illegitimate others. In these cases, crime prevention methods that focus upon identifying commonly used illicit distribution streams or distribution hubs may be most effective in reducing the number of counterfeit pharmaceuticals that find their way to consumers. Similar to the work that has been done on interventions in open-air drug markets (Corsaro, Brunson & McGarrell, 2013; Dickinson & Wright, 2015; Hsu & Miller, 2017), and hot spots for other types of crime, strategies that increase counterfeit distributors’ perceptions of apprehension likelihood and punishment, or that otherwise make distribution hubs undesirable places for crime may have a substantial impact on reducing the flow of counterfeit pharmaceuticals through illicit distribution networks.

Additionally, we felt it necessary to keep the roles of Production and Purchase as distinct roles, rather than subsuming them under the more general category of Support. The process of independent coding supported our decision, and we argue that these roles need to remain qualitatively distinct. Each of these activities typically creates a unique record or log of activity relevant to the counterfeiting scheme generally, yet, unique to their part of the scheme. These records can connect the individuals involved in the counterfeiting scheme to the scheme’s illegal activities, and they may also identify specific actors who have primary responsibility for two vitally important aspects of each scheme.

For example, when an individual purchases counterfeit pharmaceuticals or other peripheral goods from the producer of the counterfeits they may a use third-party money transfer services like MoneyGram or Western Union. This is in part due to the anonymity that comes with sending money through networks of independent payment processors, rather than sending funds through one's financial institution. Financial institutions, such as banks and third-party payment processors like Western Union, can track who is sending funds, where they are sent, the amount sent, and to whom funds are sent. This creates a detailed record that can be used to map the flow of funds against the flow of counterfeit or illicit goods. Third-party payment processors can then use this information to develop patterns of funds transfers that are combined with existing knowledge of pharmaceutical counterfeiting schemes to create a network of key individuals and locations that are central to the success of these schemes (personal conversation with Phil Hopkins October 2015).

Where patterns are identified, payment processors (either on their own, or in concert with law enforcement) can take steps to close off counterfeiters’ funding by withholding funds, thereby denying counterfeiters the benefits of their activities, or by controlling access to their services. Whatever situationally appropriate technique is undertaken by payment processors, the need to transfer funds to various individuals/groups is a necessary part of any counterfeiting scheme. Preventing, or at least significantly increasing the difficulty related to, the transfer of funds removes the primary incentive that motivates counterfeiters to engage in their crimes. While it may not be possible to close off every potential payment avenue, the producers of counterfeit goods will have to work increasingly harder, making it even more difficult to realize a profit, to receive payment for their work. This will force some counterfeiters out of the business while making the business substantially less profitable for the remaining parties.

Additionally, when the individuals sending and receiving payments for counterfeit goods are identified their locations can be mapped, and network diagrams developed. These diagrams can be used to highlight the individuals and locations that are most commonly involved in pharmaceutical counterfeiting schemes (i.e., the development of counterfeiting hot spots), allowing crime prevention resources to be targeted most efficiently and effectively.

Understanding how counterfeit producers are spatially distributed may also help to alert the conscience of consumers, through targeted or localized information campaigns and warnings, who might otherwise be taken in by these schemes. In terms of the individuals who purchase counterfeit pharmaceuticals for resale or distribution, understanding the logistical networks within which they operate can help law enforcement to disrupt groups of payment processors who are friendly to these types of illicit activities.

One final reason that the role of Producer needs to remain distinct from other roles is that this role most aptly identifies who the counterfeiter is, as the individuals in this role undertake activities that directly violate trademark protections. These individuals are the true counterfeiters. This is not to say that those who produce counterfeits are more deviant, criminal, or culpable than others involved in counterfeiting schemes, it is simply a reflection of the fact that these individuals complete the acts that violate intellectual property rights laws related to product counterfeiting.

Because of the complexity and breadth of the schemes examined in this study, we were not surprised to find that Support was the most commonly identified role category. While it may seem that the role category Support is broad, we feel that the emergence of this category reflects the complexity of pharmaceutical counterfeiting schemes. We examined schemes that included large-scale operations conducted online and involving a multitude of individuals, as well as schemes that were devised, orchestrated and performed by a single licensed healthcare provider. There is great variation in the types of supporting activities that will be needed within each of these schemes, yet, within the totality of pharmaceutical counterfeiting schemes, these activities all support the operation of the scheme. All pharmaceutical counterfeiting schemes require the product to be manufactured, sourced, shipped, labeled, marketed and advertised, and then distributed.

However, what sets one scheme apart from other schemes are how each of these activities is completed, which leads to differences in the types of roles members of the scheme undertake. Depending upon the makeup of any given scheme, pharmaceutical counterfeiting schemes can require vast amounts of support from many individuals (such as when product is manufactured and shipped from China through a network of intermediaries, then marketed and sold through e-commerce), or little to no support (as is the case when a healthcare provider adulterates drugs given to patients). This means that the crime prevention initiatives undertaken to address individuals in Support roles will depend significantly on the situational factors that define the particular scheme within which the individual operates.

Given that more than half of the schemes we investigated had an identified international component to them, it is important to stress the need for international cooperation in the prevention and mitigation of pharmaceutical counterfeiting threats. Cooperation among law enforcement partners and governments is key to both hardening the global pharmaceutical supply chain against counterfeiters and other criminals, as well as disrupting international counterfeiting markets and pharmaceutical schemes that cross country borders. While this article examined pharmaceutical counterfeiting schemes prosecuted in the United States, the importance and weight of global commerce and trade, particularly when it comes to pharmaceuticals, cannot be ignored. Addressing pharmaceutical counterfeiting schemes occurring within the United States, or any country for that matter, will in most cases require an assessment of the networks and opportunities that originate from, and exist within foreign countries. As such, the development of cross-national regulations and policies aimed at the global problem of pharmaceutical counterfeiting is likely to lead to important and substantial benefits within the United States.

On average, the pharmaceutical counterfeiting schemes we examined ran for just over two years. However, this period reflects prosecutors’ ability to accurately determine the beginning date of counterfeiting activities; determining an ending date is a more precise exercise. With Internet-based schemes, it seems surprising that only two years would have passed from inception to scheme termination. The nearly endless opportunities for adaptation and change within the online environment lends itself well to the perpetuation of these types of activities. It may be possible that the relatively short duration of the schemes we examined highlights the ineffectiveness of certain counterfeiters—those who got caught may be the least skilled.

Conversely, some of the individuals we examined may have been quite good at their crimes and may have very quickly developed very successful, high profile, schemes, leading them to become victims of their own success. It may also be the case, and future research should investigate this, that schemes that aligned with a counterfeiter’s occupation have a different average duration relative to other schemes.

Many counterfeiting schemes occur alongside the legitimate work an individual is performing, which allows them to use their legitimate workplace activities to hide their deviance. Similar to white-collar offenders, the individuals we studied tended to defy the traditional age-crime curve and had few documented negative interactions with the criminal justice system before their convictions for pharmaceutical counterfeiting offenses. It is possible that a lack of prior criminal history is not indicative of a lack of criminal behavior, but instead may be a reflection of an individual's ability to evade detection by law enforcement. Furthermore, as with many corporate crimes the average age of the individuals we studied suggests that counterfeiting schemes require some level of learned skill and ability (Benson & Simpson, 2015). This is mainly reflected in cases that involve healthcare professionals, as the knowledge and skills necessary to pull off a counterfeiting scheme are likely learned through legitimate professional activities.

The fact that the knowledge and skill needed to complete pharmaceutical counterfeiting schemes is in many ways similar to or the same as the knowledge and skill required to complete one's legitimate occupation touches upon counterfeiters' adaptability. While one's skills may help them to identify an opportunity to engage in a crime, it is the possession of those skills that enables them to complete that crime. Certain skill sets and abilities, therefore, become necessary conditions for opportunity identification, and conditions required for crime completion. These same skills and abilities also likely help to define the role an individual will take within a pharmaceutical counterfeiting scheme.

Related to this, it was a troubling finding of this study that a sizeable proportion of individuals involved in the pharmaceutical counterfeiting schemes we examined were healthcare providers. As licensed healthcare providers, doctors, nurses, and pharmacists have taken oaths to protect patient health and safety. Their willful involvement in counterfeiting schemes means that these individuals have leveraged, to the highest degree possible, the legitimacy that comes along with their titles and positions. Often doctor-patient interactions occur within a context where patients rely upon a provider's credentials and expertise for the development of trust (Entwistle & Quick, 2006). The legitimacy afforded to healthcare providers can often mask their deviance and allows the provider to abuse the bonds of trust that exist between the provider and their patient (Benson & Simpson, 2015).

It may be the case that any conflict healthcare providers feel between the legitimate goals of the medical profession and the illegal and harmful nature of pharmaceutical counterfeiting is resolved through the use of neutralization techniques (Sykes & Matza, 1957). This may allow healthcare professionals to rationalize their deviance prior to the crime, as well as to neutralize the impact of their actions following discovery of the crime in an attempt to manage the stigma attached to their deviant behavior (Benson, 1985). Unlike other types of pharmaceutical counterfeiters, healthcare providers have duties and responsibilities to the public, and will likely look for ways to reduce their culpability and control the negative social fallout related to their crimes. Efforts should be made to continually inform and educate healthcare providers about the dangers of counterfeit pharmaceuticals, while at the same time efforts around increasing oversight of these individuals should be undertaken.

Because of the close relationships healthcare providers often maintain with pharmaceutical companies, there is an opportunity for the marketplace to institute crime prevention measures that are not reliant upon the actions of law enforcement or the government. In particular, the vested interest that pharmaceutical companies have in promoting their products, combined with their interests around patient health and safety, as well as the avoidance of negative publicity, create fertile ground for company-led oversight initiatives. For example, the daily interactions that occur between healthcare providers and pharmaceutical sales reps are opportunities for increased oversight and guardianship of patients, and the pharmaceutical company's products. When sales reps visit doctors and pharmacists, they can check stock against sales records, a discrepancy between the two might indicate that illegitimate goods have found their way into the office. Using market-driven crime prevention initiatives places the impetus for counterfeit detection and removal on the trademark rights holders, and may lead to more effective and timely identification of illicit drugs.

Limitations

As with all research, this study has several limitations that must be addressed. First, the individuals we examined are not a random selection of pharmaceutical counterfeiters in the United States. However, no database of all pharmaceutical counterfeiters convicted in the United States currently exists. Although we may not be able to statistically validate the representativeness of our sample to the population of pharmaceutical counterfeiters in the country, our results are an important first step toward understanding this unique class of offender. As such, representativeness was less important of an objective than was identifying and qualifying the distinctions and similarities that exist among pharmaceutical counterfeiting scheme roles.

This study's results are also limited by the fact that it only examined individuals convicted of federal offenses. States also have laws against pharmaceutical counterfeiting, and instances of counterfeiting occurring at the local level that are prosecuted by the state rather than the federal government are not included in this analysis. As a result, it is possible that our results do not capture the unique factors of offender roles that occur at the state level. However, we feel that the schemes examined in this study capture a wide range of pharmaceutical counterfeiting incidents generally, and any schemes prosecuted at the state-level likely mirror those explored here. As such, we feel that these schemes are not likely to add substantively to our findings, yet, we encourage future research to examine this possibility.

Related to each of the previous issues is the fact that the data we examine come solely from pharmaceutical counterfeiting cases that were prosecuted in the United States. While it is clear that pharmaceutical counterfeiting schemes that involve patients in the United States have international elements to them, our examination of US-based prosecutions precluded a larger study of non-US citizens. It may be the case that, country-based differences in trademark laws, pharmaceutical regulations, enforcement procedures, culture, and other factors will lead to a different picture of the unique counterfeiter roles found within pharmaceutical counterfeiting schemes that are prosecuted outside of the United States. Future research should explore the applicability of our typology to countries other than the US.

Future research

We hope that this study represents an initial step forward in understanding who pharmaceutical counterfeiters are, rather than a solitary exploration of these offenders. As such, we reiterate the recommendation that future research explores whether our classification of pharmaceutical counterfeiting roles fits with a more representative sample of individuals from abroad. Pharmaceutical counterfeiting is a global problem, and there may be important distinctions between the counterfeiters in the United States and those from other nations. Additionally, future research should look to see if our classification of counterfeiter roles applies to other forms of product counterfeiting. Pharmaceutical counterfeiting is only one type of product counterfeiting, so it is possible that the roles identified in this study will be found in other forms of product counterfeiting. It is also possible that pharmaceutical counterfeiting has many unique and distinctive roles that may characterize it as a criminal endeavor.

Future research should also explore how technology can affect the roles that humans play in pharmaceutical counterfeiting schemes. For example, research has investigated the role of licensed healthcare providers in pharmaceutical counterfeiting schemes (Kennedy, Haberman & Wilson, 2016), yet, it is possible that the structure and operation of these schemes will shift as technologies like on-demand pharmaceutical manufacturing (Adamo et al., 2016) become prevalent. Technological changes may not change the types of activities that are needed to pull off a pharmaceutical counterfeiting scheme; rather it may make it lead to fewer people needing to be involved in each scheme. In essence, technology may make counterfeiters more efficient, and it may also replace the need to have specialized skills and abilities, which would open up opportunities for pharmaceutical counterfeiting to increasing numbers of motivated offenders.

Conclusion

The outcomes of our study, a classification of the roles involved in pharmaceutical counterfeiting schemes, represents a more efficient and focused method for classifying the individuals involved in these crimes. From this classification, we can see a segmentation of counterfeiting scheme duties, which offers opportunities for the development and implementation of role-based crime prevention strategies. Given the distinctions in roles, we have identified it seems most appropriate to reserve use of the term 'counterfeiter' to those individuals responsible for the production of counterfeit goods, as described earlier. However, we suggest that other counterfeiting scheme roles use the term ‘counterfeiter' as a qualifier that distinguishes the type of criminal activity in which the person is engaged. For example, individuals who operate a website in support of an Internet counterfeiting scheme might be referred to as a 'counterfeiting supporter,' and the individuals who sell or distribute counterfeit pharmaceuticals could be referred to as 'pharmaceutical counterfeit distributors.' Through additional research, these labels are likely to become more refined, and the unique characteristics that differentiate each of these roles are likely to lead to more refined and tailored crime prevention initiatives.

References

Adamo, A., Beingessner, R. L., Behnam, M., Chen, J., Jamison, T. F., Jensen, K. F., Monbaliu, J. C. M., Myerson, A. S., Revalor, E. M., Snead, D. R., & Selzer, T. (2016). On-demand continuous-flow production of pharmaceuticals in a compact, reconfigurable system. Science, 352(6281), 61-67.

Aksulu, A., & Wade, M. (2010). A comprehensive review and synthesis of open source research. Journal of the Association for Information Systems, 11(11), 576-656.

Benson, M. L. (1985). Denying the guilty mind: Accounting for involvement in a white-collar crime. Criminology, 23(4), 583-607.

Benson, M. L. & Simpson, S. S. (2015). Understanding White-Collar Crime: An Opportunity Perspective. New York: Routledge.

Bunker, A. M. (2007). Deadly dose: Counterfeit pharmaceuticals, intellectual property and human health. Journal of the Patent and Trademark Office Society, 89(6), 493-887.

Burgess, E. W. (1950). Comment, and concluding comment. American Journal of Sociology, 56(1), 31-34.

Business Action to Stop Counterfeiting and Piracy. (2011). Estimating the Global Economic and Social Impacts of Counterfeiting and Piracy. London: Frontier Economics.

Catizone, C. (2006). Counterfeit drugs and States’ efforts to combat the problem. Journal of Pharmacy Practice, 19(3), 165-170.

Caudron, J. M., Ford, N., Henkens, M., Mace, C., Kiddle‐Monroe, R., & Pinel, J. (2008). Substandard medicines in resource‐poor settings: a problem that can no longer be ignored. Tropical Medicine and International Health, 13(8), 1062-1072.

Chakravarthy, A. (2014, September). Analysis of cyber-criminal profiling and cyber-attacks: A comprehensive study. Paper presented at the 3rd World Conference on Applied Sciences, Engineering and Technology, Kathmandu, Nepal.

Clarke, R. V. (1980). " situational" Crime Prevention: Theory and Practice. The British Journal of Criminology, 20,(2), 136-147.

Clarke, R. V. G. (1997). Situational Crime Prevention. Monsey, NY: Criminal Justice Press.

Cockburn, R., Newton, P. N., Agyarko, E. K., Akunyili, D., & White, N. J. (2005). The global threat of counterfeit drugs: Why industry and governments must communicate the dangers. PLoS Med, 2(4), Article e100.

Cohen, L. E., & Felson, M. (1979). Social change and crime rate trends: A routine activity approach. American Sociological Review, 44(4), 588-608.

Corsaro, N., Brunson, R. K., & McGarrell, E. F. (2013). Problem-oriented policing and open-air drug markets: Examining the Rockford pulling levers deterrence strategy. Crime & Delinquency, 59(7), 1085-1107. 

Dickinson, T., & Wright, R. (2015). Gossip, decision-making and deterrence in drug markets. British Journal of Criminology, 55(6), 1263-1281.

Entwistle, V. A., & Quick, O. (2006). Trust in the context of patient safety problems. Journal of Health Organization and Management, 20(5), 397-416.

Glaser, B. G. & Strauss, A. (1967). The Discovery of Grounded Theory: Strategies for Qualitative Research. Chicago: Aldine-Athestor.

Grossman, G., & Shapiro, C. (1988). Counterfeit-product trade. American Economic Review, 78(1), 59-75.

Harris, J., Stevens, P., & Morris, J. (2009). Keeping it real: Combating the spread of fake drugs in poor countries. International Policy Network.

Hartung, F. E. (1950). White-collar offenses in the wholesale meat industry in Detroit. American Journal of Sociology, 56(1), 25-30.

Hayes, A. F., & Krippendorff, K. (2007). Answering the call for a standard reliability measure for coding data. Communication Methods and Measures, 1(1), 77-89.

Heinonen, J. A. & Wilson, J. M. (2012). Product counterfeiting at the state level: An empirical examination of Michigan-related incidents. International Journal of Comparative and Applied Criminal Justice, 36(4), 273-290.

Hoseini, S. A. R., Darbooy, S., Tehrani Banihasemi, S. A., Naseri, S. M., & Dinarvand, R. (2011). Counterfeit medicines: Report of a cross-sectional retrospective study in Iran. Public Health, 125(3), 165-171.

Hsu, K. H., & Miller, J. (2017). Assessing the Situational Predictors of Drug Markets across Street Segments and Intersections. Journal of Research in Crime and Delinquency, 54(6), 902-929.

International Anti-Counterfeiting Coalition (IACC). (2005). The Negative Consequences of International Intellectual Property Theft: Economic Harm, Threats to the Public Health and Safety, and Links to Organized Crime and Terrorist Organizations. Washington, D.C.: IACC.

International Intellectual Property Institute. (2003). Counterfeit goods and the public's health and safety. Washington, D.C.: Forzley, M.

Kelesidis, T., Kelesidis, I., Rafailidis, P. I., & Falagas, M. E. (2007). Counterfeit or substandard antimicrobial drugs: a review of the scientific evidence. Journal of Antimicrobial Chemotherapy, 60(2), 214-236.

Kennedy, J. P., Haberman, C. P. & Wilson, J. M. (2016). Occupational pharmaceutical counterfeiting schemes: A crime scripts analysis. Victims and Offenders. (Online ahead-of-print). DOI: 10.1080/15564886.2016.1217961.

Lavorgna, A. (2015). The Online Trade in Counterfeit Pharmaceuticals: New Criminal Opportunities, Trends and Challenges. European Journal of Criminology, 205(12), 226-241.

Miles, M. B. & Hubberman, A. M. (1994). An Expanded Sourcebook: Qualitative Data Analysis. 2nd ed. Thousand Oaks, CA: Sage.Newton, P. N., Green, M. D., & Fernández, F. M. (2010). Impact of poor-quality medicines in the ‘developing’ world. Trends in Pharmacological Sciences, 31(3), 99-101.

Newton, P. N., Green, M. D., Fernández, F. M., Day, N. P., & White, N. J. (2006). Counterfeit anti-infective drug226-241.s. The Lancet: Infectious Diseases, 6(9), 602-613.Nykodym, N., Taylor, R., & Vilela, J. (2005). Criminal Profiling and insider cyber crime. Computer Law and Security Review, 21(5), 408-414.

Qureshi, Z. P., Norris, L., Sartor, O., McKoy, J. M., Armstrong, J., Raisch, D. W., et al. (2011). Caveat oncologist: Clinical findings and consequences of distributing counterfeit Erythropoietin in the United States. Journal of Oncology Practice, 8(2), 84-90.

Rogers, M. (2003). The role of criminal profiling in the computer forensics process. Computers and Security, 22(4), 292-298.

Shaw, E. D. (2006). The role of behavioral research and profiling in malicious cyber insider investigations. Digital Investigation, 3(1), 20-31.

Spink, J., Helferich, O. K., & Griggs, J. E. (2010). Combating the impact of product counterfeiting. Distribution Business Management Journal, 10(1), 59-63.

Spink, J., Moyer, D. C., Park, H., & Heinonen, J. A. (2013). Defining the types of counterfeiters, counterfeiting, and offender organizations. Crime Science, 2(1), 1-10.

Sutherland, E. H. (1940). White-collar criminality. American Sociological Review, 5(1), 1-12.

Sutherland, E. H. (1945). Is" White collar crime" crime? American Sociological Review, 10(2), 132-139.

Sykes, G. M., & Matza, D. (1957). Techniques of neutralization: A theory of delinquency. American Sociological Review, 22(6), 664-670.

Tappan, P. W. (1947). Who is the Criminal? American Sociological Review, 12(1), 96-102.

Trent, C. (2013, November). Assessing the risks of counterfeiting and illicit diversion for health c are products. A-CAPP Paper Series.

U.S. Government Accountability Office. (2010). Intellectual Property: Observations on Efforts to Quantify the Economic Effects of Counterfeit and Pirated Goods. Washington, D.C.: GAO.Yar, M. (2008). The other global drugs crisis: Assessing the scope, impacts and drivers of the trade in dangerous counterfeit pharmaceuticals. International Journal of Social Inquiry, 1(1), 151-166.

Contributors

Jay Kennedy is an assistant professor at Michigan State University, jointly appointed to the School of Criminal Justice and the Center for Anti-Counterfeiting and Product Protection. His current research explores managerial and organizational responses to employee theft within small and medium enterprises, the incarceration and post-incarceration experiences of white-collar offenders, the sale of counterfeit goods on the Internet, and the structure of occupational pharmaceutical counterfeiting schemes.

Ksenia Petlakh is an Assistant Professor of Criminal Justice at the State University of New York at Delhi. She earned her Ph.D. in Criminal Justice from Michigan State University and her BA in Criminal Justice and Political Science from the University of Michigan-Dearborn. Her research interests include law and the courts, criminal indigent defense, judicial administration, and temperament theory.

Jeremy M. Wilson is a professor in the School of Criminal Justice at Michigan State University, where he founded and directs the Center for Anti-Counterfeiting and Product Protection and the Program on Police Consolidation and Shared Services. He has collaborated with police agencies, communities, task forces, companies, professional associations, and governments throughout the United States and the world on many complex public safety problems. Among other areas, he has written extensively on brand protection, product counterfeiting, police consolidation and staffing, field interventions for violence prevention, and internal security.

Comments
0
comment

No comments here