Counterfeit, mislabeled and mishandled drugs are infiltrating U.S. pharmacies. Although a relatively few medications are now affected, investigators and pharmacists say the problem could spread if regulators don’t tighten requirements for drug wholesalers.

Examples include:

• Vials of Procrit and Epogen, which treat anemia, have been found to contain 20 times less active ingredient than labeled.
• A fake form of Serostim, used by AIDS patients to prevent muscle wasting, has caused some patients to become ill.
• White pills labeled "aspirin" have been found in bottles of schizophrenia treatment Zyprexa.
• Ten types of counterfeit drugs have been found in Florida in the past two years, including Procrit, Epogen, Serostim, Zyprexa, antifungal Diflucan and AIDS drugs Combivir and Retrovir.

Investigators blame the increase in fraudulent drugs on the ability to make more sophisticated forged labels, the large number of small drug wholesalers and the increasing number of expensive drugs that have the potential to bring in large profits.

Counterfeit drugs make up only a tiny fraction of the $192 billion worth of drugs sold in the United States each year. However, according to investigators this amount could grow as additional expensive, genetically engineered medications are introduced. There are also many holes in the U.S. drug regulatory system.

For instance, investigators say that it is too easy in most states to attain a wholesaler’s license to distribute drugs. States often have hundreds or even thousands of licensed drug wholesalers, which allows more opportunities for fraudulent drugs to be circulated.

Also, drugs may be passed through many avenues as they travel from factory to pharmacy, at times making it difficult for pharmacies to find out who handled the drugs. The wholesale industry has opposed efforts to require documentation every time a drug is bought or sold, and the FDA has not fully enacted a law from 1988 that aimed to trace drugs to their source.

Further, there are no requirements for drug manufacturers to report cases of counterfeit drugs, although the drug industry reports that they will begin to voluntarily report suspected cases.

Some 73 counterfeit or tampered-with drug investigations have been opened by the FDA since 1998, 32 people have been arrested and 25 convicted of conspiracy to introduce counterfeit drugs into commerce.

There are also holes in the U.S. drug distribution system. About 46 percent of prescription drugs travel straight from manufacturers to hospitals and pharmacies, while 54 percent go to wholesalers.

Of the drugs that go to wholesalers, 90 percent go to Cardinal, McKesson and AmerisourceBergen, the three largest wholesalers in the U.S. that together distribute more than $100 billion worth of drugs each year.

The other prescription drugs go to smaller wholesalers who sell to pharmacies, clinics, physicians and each other. This secondary market is where many of the problems occur, according to investigators.

Some secondary wholesalers buy drugs at a discount from pharmacies or on the black market while others buy drugs that have been stolen, illegally imported or adulterated.

Additionally, some smaller wholesalers operate out of homes, strip malls and storage sheds and may mishandle drugs.

Pharmaceutical companies' drug pricing strategies may contribute to the illegitimate channeling of drugs. Some pharmacies, known as closed-door pharmacies, don’t sell drugs to the public but rather only to nursing homes and other institutions that get discounts from the manufacturers. However, the pharmacies may then illegally sell the drugs, which they’ve bought at a discounted price, to wholesalers who in-turn make profits by re-selling the drugs to other wholesalers.

Some pharmacists say the industry should create standards to determine which drug suppliers are legit and which are not. Additionally, they say there’s a need for more action from federal and state regulators to make sure drugs are legitimate.

USA Today May 14, 2003