Counterfeit Medicine now being Stopped

Aug. 23, 2009 - PRLog -- Digital Age Institute Ltd. is the first company world wide, who launches a globally workable, implemented system to fight counterfeit products effectively.

The system which is patented, works very simple, in that the consumer will be able to check your protected product for genuineness simply by entering the code on the protected product into a SMS text message which will then be sent to a SMS gateway.

The SMS gateway will receive the SMS text message with the code, and can immediately determine if the product is genuine or not. If the product is genuine, the SMS gateway will send back to the consumer a message stating the product name, manufacturer, contact code, batch numbers and information as to where the consumer can seek more information about the product, for instance about maintenance etc.

Contrary to the 110 other patents which has been issued, this one here is not just theory - it is implemented and in the process of being ramped up, and up and running 24/7 as we speak.

We are interested in contacts with both consumers who have experienced counterfeit and how that has affected them, and manufacturers who are interested in implementing the system.

Implementation is pretty simple, in that a manufacturer can choose only to receive the necessary encoded protection labels. The manufacturer will receive the necessary number of labels, against parting with 0.32% of the turnover for the products in question. Thus, for instance, a typical manufacturer of medicine, for instance GSK, who makes the product Panadol, which is selling for £845 million per year, and who's product according to articles in several news media is counterfeited in several countries as much as up to 40, 50 and 60%, will have to part with £2.71 million per year to obtain the necessary protection, naturally increasing with the increased market share. This cost includes creation of awareness, which will be done together with all the other manufacturers who signs up for this agreement.

BUSINESS:

The business motive for GSK to do so would be easy to find: Since at least 40% of the products on the market are counterfeit, it means that there is a market potential of 66% more. Just do the math: If 60% of the products are genuine, and 40% are not genuine, then 40% is 2/3 more than the 60%. It means that if GSK sells 10 billion Panadol tablets per year, they would be able to increase that to 16.67 billion, and turnover would go from £ 845 million to £1,402 million resembling an increase of £ 557 million. If we assume that the profit of GSK remains the same like in their most recently published financial statement, namely 22.8% after tax, (24.532 billion before tax, and 5.551 billion after tax), they are in for a profit of 22.8% of the increase of £557 million, resembling 0.228 x 557 = £ 127 million per year.

The awareness campaign will be created and maintained by the 0.32% contribution of £2.71 million, raising to 0.32% of the £1,402 million = £ 4.49 million annually when the market has been taken.

All that a manufacturer need to do, is to state their interest, send a production site description in digitally protected envelope to our counterfeit@digitalageinstitute.com e-mail address, then we will return a quotation for the corporate manufacturer, which will include product, maintenance, installation, support and training. Terms and conditions will of course apply, and installation will depend on physical location, and depend on if we already have engineers trained to implement on location.

PARALLEL PRODUCTIONS
The system also provides the manufacturer with unprecedented direct contact to the consumer, and a built in side effect for the manufacturer is that they can control OEM manufacturers and overseas manufacturers such that when these are given license to produce lets say 2 billion tablets per year, then they cannot exceed that amount, as they will not get more than 2.05 billion labels to put on the products, which will prevent that the company can actually push the product to the market.

It also means that a manufacturer like GSK could send much more advanced pharmaceutical products to be outsourced, as they would remain in control with the outcome. Furthermore parallel imports can be controlled and seized at borders, as the source of the product (the sub-manufacturer) would be directly identified. All of this makes it possible for the pharmaceutical manufacturers to reduce their cost base, while increasing the profits, to the benefit for the consumer and the share holders.

WHAT ABOUT THE COUNTERFEITERS?
Our approach to the current counterfeiting manufacturers is, that the genuine manufacturers should actually sit at a table and negotiate a license to them. Take a look at it: They have everything in place, such that they can manufacture all what it takes to put completely identically looking tablets into blister packs. It means that many of the counterfeiting manufacturers would actually have production facility in place to make the entire packaging. The only thing missing would then be the real product and the license to do so. When confronted with the possibility of being stopped, and when GSK is confronted with the possibility of having to ramp up production with 66% within maybe a year or two, it may not be such a completely bad solution.

Furthermore - counterfeiters are not necessarily only bad. They employ hundreds of thousands of workers, world wide, who also have families to feed, and they will need maybe some courses, education and exams - then they would be completely fit to run a professional subsidiary of a professional pharmaceutical manufacturing company. The idea is not that far fetched: If you can't beat them, join them. The counterfeiting companies will have no choice. And - handed an olive branch - who wouldn't reach out to grab it ? It would maintain hundreds of thousands of jobs - upgrade these to industrial standard over a year or two, and make it possible now to collaborate in stead of fighting.

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Digital Age Institute is one of the top most Software Houses in Africa. Situated in Nairobi we provide excellent Outsourcing Facilitation for your development projects, and also top University level education in Professional Software Development.