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Congress Investigates Fake Pharmacies That Exacerbate Shortages, Increase Prices

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According to the National Association of Boards of Pharmacy website, three Congressional committees are investigating the practice by which individuals obtain pharmacy licenses in order “to use them as a means for purchasing cancer drugs and other medications that are then sold to gray market wholesalers, rather than dispensed to patients.”[1] Instead of dispensing drugs in short supply to patients, the “pharmacies” have transferred them to wholesaler companies owned by the same individuals,” and the drugs are then “sold back into the gray market sometimes in violation of state laws and at exorbitant rates.”

According to Linda Johnson of the Associated Press, March 21, the pharmacies and wholesaler companies are involved “in a "shell game" — to make money by taking advantage of the drug shortage crisis that's disrupting hospital and other patient care.” The fake pharmacies are “allegedly set up solely to buy and resell the drugs at huge markups.”[2]

Members of House and Senate committees with oversight into the matter have sent letters requesting documents from three licensed pharmacies buying drugs in critically short supply that are required for the treatment of cancer and other illnesses, and selling these drugs back into the gray market instead of providing them to patients who desperately need them. Congressman Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, Senator John D. Rockefeller, Chairman of the Senate Committee on Commerce, Science, and Transportation, and Senator Tom Harkin, Chairman of the Senate Committee on Health, Education, Labor, and Pensions, have requested three pharmacies provide information requested by April 11, 2012. This effort is part of a larger investigation into “gray market” middlemen possibly engaged in drug speculation. Letters have been sent to an additional 19 licensed pharmacies requesting information about their role in selling drugs in seriously short supply to wholesalers that turn them over to the gray market instead of dispensing them to patients.[3]

This is a reprehensible practice that should be ended as soon as possible, and these so-called pharmacies should prosecuted to the fullest extent possible. The ingenuity of profiteers and speculators never ceases or ebbs, no matter the venue or time period. Hopefully, this particular practice can be ended before the supply of these important drugs is further disrupted.


[1] “Fake Pharmacy Schemes Linked to Cancer Drug Shortage Are Under Investigation by Congressional Committees”, National Association of Boards of Pharmacy, March 28, 2012, http://www.nabp.net/news/fake-pharmacy-schemes-linked-to-cancer-drug-shortage-are-under-investigation-by-congressional-commit/

[2] Fake Pharmacies Price Gouging on Drugs, Johnson, Linda, Associated Press, March 21, 2012, http://news.yahoo.com/lawmakers-fake-pharmacies-price-gouging-drugs-143502210.html

[3] Cummings, Rockefeller and Harkin Investigate Fake Pharmacies Buying and Selling Shortage Drugs in the Gray Market”, Press Release, U.S. Senate Committee on Oversight and Government Reform, Cummings, Rep. Elijah, March 21, 2012, http://democrats.oversight.house.gov/index.php?option=com_content&view=article&id=5654:cummings-rockefeller-and-harkin-investigate-fake-pharmacies-buying-and-selling-shortage-drugs-in-the-gray-market&catid=3:press-releases&Itemid=49&utm_source=BenchmarkEmail&utm_campaign=e_News_03_28_12&utm_medium=email