Part II of this three-part article which was earlier published in Pharmabiz contained a description of the three major categories of anti-counterfeiting solutions. In this last part, these three categories are now compared and contrasted in brief in relation to the five Golden Qualities that were earlier considered (Part I) to be instrumental features of any anti-counterfeiting technology for the pharmaceutical industry.
The various technologies within all three categories can be implemented at the individual product level. The situation changes considerably, however, when it comes to actual ability of an ordinary consumer to use the technology for authenticating a product. The passive technologies certainly do allow a consumer to determine that a hologram or some other visible feature is present. The challenge is to know what to look for and to be savvy enough to interpret a hidden image or be able to turn a product just enough to notice the changing colours in OVI print. This requirement becomes particularly problematic when a counterfeiter introduces a fake version of one of the passive technologies, such as a hologram. It is virtually impossible for ordinary consumers to identify a true hologram from a fake one.
Thus, all of the passive technologies when used alone do not sufficiently empower consumers in terms of product authentication.
The active technologies are also poor in terms of consumer empowerment for the simple reason that customers do not carry around the special readers that are needed for verification. It may be possible for such readers to be installed at the retail outlet or other sites. However, this effort is fraught with logistical difficulties, notwithstanding the concern that in many instances the retailer may actually be involved in the counterfeiting operation. Thus, even if a branded product is protected with any one of the sophisticated offerings in this category, the technology would simply be impenetrable to consumers. As a result, none of the positive aspects associated with consumer empowerment are made available to the brand owner when implementing an active technology. The only technologies to attain a passing grade in terms of this core requirement are the DMS and DME solutions (mass encoding). When used as a stand-alone feature, DMS and DME codes can be verified via SMS on mobile phones, which are expected to have a market in excess of 600 million subscribers in India alone by 2011. Only the DMS and DME solutions therefore pass the consumer empowerment test that forms a key feature in an anti-counterfeiting technology.
Cost and value
A core aspect of the value proposition relates to difficulty in duplication. The more robust the technology, the harder it is to duplicate and therefore provides a longer lifetime of service to the brand owner. As noted previously, holograms are notoriously easy to replicate. Some of the other passive technologies, however, can be more robust but are nevertheless vulnerable in their own way. Both the active technologies and mass encoding, however, are superior in this regard. All of the active technologies are sufficiently sophisticated that duplication becomes virtually impossible. Similarly, the codes generated by DMS and DME systems are difficult to guess. The only caveat is that the database requirement of DMS makes it vulnerable to hacking, which is not a concern with DME. A lost bank of codes can be potentially devastating to a brand owner, not only in terms of the security breach but also as a public relations matter.
In terms of cost, the active technologies suffer heavily due to both the capital investment needed to implement these systems as well as the residual cost on a per product basis. Furthermore, the readers or scanners can be quite costly, with some being extremely advanced devices that are only available from the technology provider. Although RFID scanners have now come down in cost, the RFID tags themselves continue to pose a major concern. Although RFID has shown its suitability as a high-volume supply chain management tool, it is not an appropriate stand-alone anti-counterfeiting solution.
The two technology categories that generally require low capital investment and running cost are the passive technologies and mass encoding. There are, however, subtleties that should be considered. Passive technologies involving label application are generally faster to implement than those involving direct etching on a package in the production line. Similarly, DMS and DME code printing directly on the package requires ink jet printers that are of sufficient resolution to allow veridical scripted code and 2D barcode printing. Here again, label application offers a simpler start-up solution to immediately initiate brand protection, though in the long run direct printing will be more cost effective and easily make up for any needed investment in new printers.
The pricing concern with DMS codes applies largely at the higher volume end, where sophisticated database management systems and specialized personnel are required for operational purposes. The concern with DME codes, however, relates to the low volume end, where the price per code makes it commercially difficult to deploy unless the product is of high value. Thus, from a strictly pricing viewpoint, DMS is more suitable at low production volumes whereas DME is more suitable at high volumes.
Forensics and interdiction
The passive technologies as a whole are entirely inadequate in terms of forensic applicability by virtue of their ease of duplication and the generality of their intrinsic features. For example, a well-replicated fake hologram can certainly be shown to be such, but only after careful scrutiny by an industry expert. The same holds true for overt and hidden image applications. Watermarks, for example, are notoriously easy to duplicate and fake versions have been found in counterfeit currency notes . This lack of a strong forensic platform also means that interdiction (and eventual prosecution) is difficult with the passive technologies.
Both the active technologies and mass encoding represent extremely strong forensic platforms. The sophisticated nature of the active technologies and the specificity of detection empower security agents to make a forensic determination on the spot in most cases. The only caveat relates to those active technologies that require laboratory analysis for confirmation. Although the forensic use remains strong in this case, the lack of immediacy at the point of sale mitigates the interdiction capabilities. Mass encoding also offers strong forensic applicability. If a branded product that is supposed to have a code but does not, then it is a fake by definition. If many products in a shop have the same code, then they are all fake by definition. If a code is present, but does not pass the authentication step, then it is fake. Thus, a printed code, when present, is either valid or not.
Simplicity and adaptability
The passive technologies and mass encoding have the advantage of being less intrusive in nature in terms of implementation in the production line. In most cases, both of these technologies will require label application, which can be undertaken in an automated or semi-automated manner. Label application is generally common in most industries and therefore a variety of options are at the disposal of the brand owner. The active technologies, however, require greater sophistication in terms of implementation. Although RFID tags can be easily applied, the infrastructure that is required to fully implement a robust RFID solution is quite involved. Similarly, the various forensic taggants each have their own specialized requirements in terms of application. Some can be embedded into the product itself whereas others are applied on the package. In general, these technologies necessitate specialized solutions that can be fairly intrusive for most industrial applications. The technologies in all three categories are fairly adaptable in the sense that new variants can be introduced after they have been implemented. Although there may be subtle differences between the individual exemplars within a given category, those differences are not sufficient to warrant any overt concerns. Technological adaptability allows brand owners to modify the brand protection solution to changes that take place in terms of new package design, brand evolution, or other externally imposed conditions.
Value-added features
There are a number of value-added features that can be incorporated into any anti-counterfeiting solution. One feature that has been considered to be important is whether the technology provides a backbone to permit supply chain management. This is a core feature that drove the development of many anti-counterfeiting technologies because one path to brand protection is having a secure supply chain. Although it is now clear that this alone does not protect a brand, due to infiltration by third parties at various points such as the retail level, the oft-expressed opinion is that a technology that provides a distribution management tool would represent an important supplemental feature. Another feature that is important to many brand owners is that the anti-counterfeiting technology should also serve as a bi-directional communication tool, and thereby provide a portal for consumer outreach and product information.
How do the various anti-counterfeiting technologies fare in these two regards? It is clear that the passive technologies do not offer either provision to the brand owner. All offerings in this category are merely visual tags, emblems, or images. As such, there is no communication portal and hence no possibility for use as a tool for consumer outreach. Furthermore, the passive technologies do not provide any supply chain management functions because there is no scope for scanning the product at any point in the distribution process.
Most of the active technologies, however, provide this feature and the associated software to track products through the supply chain. Furthermore, many of the technologies are compliant with regulatory frameworks that demand an e-pedigree. The major drawback to the active solutions, however, is that they cannot be used as a communication tool because there is no consumer interaction with these technologies.
The mass encoding solutions encompassing DMS and DME provide a strong platform with regard to both value-added features. The 2D barcodes, as carriers of digital information, can fully support a comprehensive supply chain operation and maintain regulatory compliance (e.g., e-Pedigree generation). An important feature to look for is whether the technology provider has designed the software itself or whether it is offering a third-party solution. The latter should be avoided. Some DMS vendors only offer an SMS-based authentication solution and do not provide either 2D barcoding or supply chain management support.
It is not in the brand owner’s long-term interests to invest in mass encoding technology whose functionality is limited to only product authentication.
The mass encoding technologies also provide brand owners with significant opportunities for consumer outreach. The mobile phone is essentially the reader of DMS and DME codes, either by means of manual entry or automated scanning with the phone’s camera. Regardless of the code entry method, the bounce-back message sent by the brand owner can contain a considerable amount of information in addition to validating the product.
The next steps
For most brand owners, the path to choosing the right technology is a complex undertaking that requires sound judgement in adopting a solution with the best overall characteristics as well as one that is ideally suited for the specific needs of that company. The starting point for finding the right brand protection solution is to first understand which technologies are suitable for a particular product in the context of two important parameters — its annual production volume and the product’s MRP. Once that delineation is made, the brand owner can then evaluate the offerings within each suitable technology category by taking into account the features that have been described in this chapter along with the perspectives offered in terms of how they fare against the five Golden Qualities.
Brand owners who are currently being targeted by counterfeiters are faced with three levels of decision-making. The first level in the decision tree involves making a strategic choice of whether to do something or do nothing about their counterfeiting problem. The senior management of the company must make a strategic decision whether or not to adopt a proactive approach. In the event that a decision is made to undertake brand and consumer protection through technology deployment, then the next level in the tree is reached — determining which of the three general categories of anti-counterfeiting solutions is best suited. Section C of this chapter presented five so-called Golden Qualities that are meant to serve as a guide for purposes of evaluation.
The next step for the brand owner is to determine which of the Golden Qualities are truly important. For example, some companies may covet a sophisticated forensic solution and not be concerned with consumer empowerment because they have a strong field force of security agents that keeps vigilance over the marketplace. Other brand owners, however, may value the consumer empowerment features associated with mass encoding. Regardless of the factors that are operative in any given company, a careful comparison should be made across the multiple technology offerings. Section D of this manual provided a comprehensive description of the various anti-counterfeiting solutions and Section E provided a comparison between them. The outcome of this evaluation should lead the brand owner to determine which particular category — either passive, active, or mass encoding — is the most suitable for their purposes.
The third level in the decision tree then is to choose among the different technologies associated with that category to ensure that the solution is cost-effective, meets the needs of the brand owner, and will provide compliance with emerging regulatory standards in global markets. Technology vendors must be able to make a convincing case in terms of all three parameters. The only remaining matter then would be to identify the actual vendors within the chosen technology. It is advisable to proceed initially with the most vulnerable brands and thereafter expand to cover the full product line. A graded approach not only provides the technology vendor with an opportunity to ensure successful implementation at the plant level, it also allows the pharmaceutical company to become acquainted with how the technology actually works. It is of paramount importance that personnel among the various departments of the company — e.g., production, sales, marketing, supply chain, quality control, legal etc. — be fully involved to ensure maximum likelihood of deploying a successful anti-counterfeiting programme.
The author lives in Montréal and advises various stakeholders, such as governmental agencies, industry,and trade bodies, on optimal solutions to combating pharmaceutical counterfeiting and protecting consumers.