There’s a small light gray house, a tree-lined street, and an average suburban area not far from the spectacular Rocky Mountains.
It’s hardly the type of location you would think an inquiry into Ozempic’s illicit sales would go. However, it did.
An worldwide illicit marketplace where criminals either blatantly modify the pharmaceuticals or ship the actual product from overseas was discovered during a CNBC investigation into counterfeit weight loss pills. This practice is known as drug diversion and is unlawful under federal law.
Phony or illicit versions of Novo Nordisk’s obesity medication Wegovy and diabetes medication Ozempic, as well as Eli Lilly’s Mounjaro and Zepbound, are mostly involved in the activities. All four medications belong to the highly popular GLP-1 family of weight reduction medications. Due to the therapies’ extraordinary demand, fraudulent schemes have emerged in an effort to take advantage of the spike.
A firm named Laver Beauty, which claimed its location on that calm residential street in Boulder on both its website and corporate paperwork, sold a medicine to CNBC under the brand name Ozempic. A month’s supply of the medication cost $219, which is significantly less than the $968 stated price of Ozempic in the United States.
Despite receiving mail and a 1099 IRS tax form addressed to Laver Beauty, the Boulder home’s owners claim they are unrelated to the business.
DHL transported the medication that CNBC bought from an office building in Shijiazhuang, China, which is around four hours’ drive from Beijing. Arriving at the CNBC offices in Englewood Cliffs, New Jersey, the delivery was a simple cardboard box that included two melting ice packs as its only refrigeration. Ozempic should be kept in a refrigerator for storage. The medication package had the Novo Nordisk brand and Chinese text on it, and it looked real.
The medication seems to be a “diverted legitimate product that was produced for, and distributed to, the Chinese market during late ’23 and early ’24,” according to an email from Novo Nordisk. It would thus be prohibited or disapproved for the US market.
“It is not possible to verify the sterility, which could pose a higher risk of infection for patients using the fake product,” the business continued.
Law enforcement officials informed CNBC that the federal investigation into Ozempic shipments being transported to the United States includes the Ozempic that was received from China.
Laver Beauty did not reply to CNBC’s request for comment, but in a WhatsApp exchange, a person posing as a company official informed CNBC that “all of our products are authentic.” We don’t market phony ones. The individual admitted that the item CNBC bought was meant for the Chinese market.
The Boulder location “is the previous address of our U.S. warehouse,” the agent added in the message. The Boulder address was taken down from the business’s website one day after CNBC made inquiries about it.
False prescription drugs
The Ozempic that CNBC bought is regarded as a medicine that has been unlawfully diverted. The proliferation of counterfeit pharmaceuticals, or imitation goods that seem legitimate, is a different but related developing issue.
Authorities in the UK found hundreds of fake Ozempic pens last year; these were insulin pens that had been sold under the Ozempic brand.
Andy Morling, deputy director of criminal enforcement for the UK’s Medicines and Healthcare Products Regulatory Agency, said, “We saw that the demand increased and quite often as it happens in these situations, criminals try and fill a gap where the supply and demand aren’t balanced for a particular product, and we started seeing real counterfeit versions of the Ozempic product on the market.”
From a warehouse outside of London, where the counterfeit goods are kept, Morling talked with CNBC. In 2023, 869 Ozempic counterfeit pens were found.
Pharmaceutical firms and federal regulators claim that there are substantial health dangers associated with using counterfeit weight loss medicines. They may occasionally be lethal to the person utilizing them.
The company that makes Zepbound and Mounjaro, Eli Lilly, stated that it is aggressively battling fakes.
“We have a highly complex and strict mechanism in place to evaluate medications before approving them for usage in patients. Sadly, though, [counterfeits] don’t get through that system at all, according to Dr. Daniel Skovronsky, president of Lilly Research Labs and chief scientific officer of Eli Lilly.
He presented CNBC with an elaborate hoax, dubbed Mounjaro, but really containing a Type 2 diabetes drug that doesn’t result in weight reduction.
“It appears to be identical to Mounjaro and is packaged in a box labeled as such,” he said. It also includes pens bearing the Mounjaro label. However, it’s not at all Mounjaro.
The weight-loss medication retatrutide, which the business hasn’t even put on the market yet, is already being targeted by counterfeiters. It’s being sold online, according to CNBC.
“It’s now being tested in Phase 3 clinical studies. We have no idea yet, but Skovronksy stated, “I hope to get those results next year and we’ll find out.”
When asked about websites purporting to offer retatrutide, Skovronksy responded, “Yeah, that’s weird… Outside of clinical studies, not even the genuine retatrutide is suitable for usage in patients.
An increase in port seizures
At the expansive international postal facility situated on the grounds of John F. Kennedy International Airport in New York City, it is not uncommon to come across counterfeit or diverted Ozempic and other obesity treatments. The facility made more than 60,000 seizures of illicit and counterfeit items last year.
Sal Ingrassia, the port director in charge of U.S. Customs and Border Protection (CBP) at JFK, told CNBC, “I am not surprised, unfortunately, any of these new type of drugs that we’re seeing, whether it be weight loss drugs or other drugs.” “They’ll be shipped through this facility illegally, counterfeited, or diverted.”
Since January 1, CBP claims to have made more than 198 seizures of drugs bearing the Ozempic label. Along with one cargo named Mounjaro, nine shipments of medicine branded Wegovy were also intercepted.
How much of that medicine was genuine and smuggled into the United States or was counterfeit is not made clear by the CBP seizure statistics.
He stated that it was evident the shipment had “broken the legal supply chain” when CNBC showed Ingrassia the Ozempic that it had bought from Laver Beauty, the box not having the necessary refrigeration.
I believe that if we see this, we should intercept it and take appropriate action. This thing is hazardous,” he declared.
According to Ingrassia, he anticipates that this year will see twice as many weight loss product interceptions as last.
What happens to the objects that are seized? According to Ingrassia, U.S. Customs is not permitted to destroy injectable pens unless they are a part of an ongoing FDA investigation, since they fall under the category of medical equipment. After that, they are returned to the foreign provider.
Crackdown on illicit websites
According to Ingrassia, the majority of diverted product orders are placed online or through social media.
“Most of these people are placing this order, visiting websites, and searching for a discount. And by doing so, you’re undoubtedly taking a tremendous risk. However, we’ve also observed that physician offices are placing orders for these goods,” he said.
In an attempt to combat drug trafficking, the pharmaceutical sector has partnered with BrandShield, a cybersecurity firm.
CEO of BrandShield Yoav Keren showed CNBC a number of websites that the business reported and that were eventually taken down, including a Facebook page and a TikTok account that purported to be GLP-1 manufacturers and offered the medication.
Representatives from TikTok and Meta, the parent company of Facebook, Instagram, and other platforms, stated that their firms take steps to remove listings that promote the selling of prescription medications.
“This is a challenge that spans platforms, industries, and communities, which is why we work with law enforcement, regulators, and private industry to combat this problem,” a Meta spokeswoman wrote in an email to CNBC. We are still devoting resources to this sort of content and are working to strengthen our enforcement.
According to Keren, 250 websites that BrandShield had determined were connected to fraudulent weight-loss goods were taken down last year—eight times as many as in 2022.
We’re on them, but it’s kind of a whack-a-mole situation. We’re pursuing them; with the use of technology, we can locate them rapidly,” he remarked.
The relationship with Turkey
The World Health Organization, which sent a global notice in June alerting people to the health hazards of purchasing phony goods, reports that counterfeit Ozempic has been identified in 15 countries.
It’s a major issue for the US government.
The Intellectual Property Rights Coordination Center, which combats counterfeiting, has Nicole Johnson as national program manager. “We are seeing a lot of diverted medicines coming in from Europe and South America.” “However, a lot of what we’re seeing with counterfeits right now in the US is just people reusing old Ozempic pens; they can just take the original packaging and put saline in it.”
According to Johnson, China, India, Mexico, the United Kingdom, and Turkey are the leading nations from which illicit narcotics and counterfeit goods are imported. She claims that government-subsidized medications have proliferated the market for fake drugs in Turkey.
Istanbul is renowned for its magnificent Bosphorus, which is encircled by magnificent palaces and mosques. However, U.S. officials that monitor counterfeit medications also claim that it is one of the hubs of the lucrative drug trade.
Typically, thieves look for opportunities to take advantage of in order to increase their earnings. Thus, the drugs were acquired and thereafter distributed globally – an item meant to benefit individuals, but it’s being abused, according to Johnson.
The Turkish National Police carried out operations around Istanbul in the fall of last year as a part of a coordinated global operation.
Maziar Executive vice president of Novo Nordisk’s international operations, Mike Doustdar, concurred that Turkey had developed into a hub for pharmaceutical criminality.
According to Doustdar, counterfeiters have obtained advanced packing machinery that is “on par with the original company equipment.”
They obtain the equipment essentially from the same location as we or our rivals do. Thus, they create a very striking resemblance between the package and the genuine product,” he stated.
Major pharmaceutical firms in Turkey are represented by Direnc Bada, an attorney based in Istanbul, who noted that there are “more and more online channels promoting these products… and it’s forbidden in Turkey actually to sell these through online channels.”
FDA notification and grievances
The FDA declared in a December notice that it had found “thousands of units of counterfeit” Ozempic in the “legitimate U.S. supply chain” in the United States.
An FDA representative said that there had been no changes to the first notice when asked about the progress of the investigation into the fake Ozempic.
Purchasing counterfeit medications carries a significant risk. Consuming illicit versions of the pills might be harmful to one’s health because of the formulation’s sensitive nature and the particular shipping requirements for the medications.
Counterfeiting an upscale handbag is one thing. When a medication is counterfeited, it’s a whole other story, according to Doustdar.
Since 2019, there has been a noticeable increase in reports of problems with weight reduction medications that contain tirzepatide, the main component in Mounjaro, or semaglutide, the active ingredient in Ozempic.
Patient safety is our industry’s and our company’s license to operate, thus this is a very severe matter. Furthermore, you’re endangering people’s safety,” Doustdar said.
