The Fraud Examiner

Online Pharmacies: Convenience, Privacy... and Fraud

September 2012 

By Yasmin Vazquez 


The rising popularity of online pharmacies in today’s economy provides a new channel that is vulnerable to fraud. Pharmacies operating through the Internet offer convenience, low prices and privacy. As a sufferer of rosacea — a skin condition that causes redness in the face — I was prescribed a medicated wash by my dermatologist that, with insurance, costs nearly $250. The same prescription could easily be purchased online from a pharmacy located in another country for a fraction of the cost. But, would I receive the actual product or a counterfeit? Would I fall victim to a fraudulent or “rogue” online pharmacy?


Red Flags 

During an investigation, there are several red flags to be aware of when determining if an online pharmacy is operating a scam. A regular pharmacy requires a doctor’s prescription and has a pharmacist available either in person or by phone to answer any questions about a prescription. An online pharmacy that does not request a doctor’s prescription and cannot provide a person to speak with can be an indicator of a fraudulent site. A pharmacist is necessary to advise of any potential side effects of medications or interactions with other prescriptions. In one recent case, Alli, a popular weight loss tablet, was being sold online to customers, but these customers were receiving a counterfeit product that did not contain the active ingredient orlistat. Instead, the fake pill contained sibutramine, a controlled substance that needs to be monitored by a physician because of its potentially harmful interactions with other medications.


Additionally, if the location of the pharmacy cannot be identified, this should be a warning sign. Not knowing the source of a medication should be cause for concern regarding the safety and effectiveness of the prescription. For example, prescriptions received outside of the U.S. are not approved by the Food and Drug Administration (FDA) and, therefore, follow different quality assurance standards or none at all. The Therapeutic Goods Administration (TGA), which is the regulatory organization for medicines in Australia, also warns consumers that prescriptions ordered from other countries or unknown sources may not meet the same safety and quality criterion required by the TGA. 


In June 2012, Andrew Stempler was arrested in Florida for operating Mediplan Pharmacy, an online pharmacy selling counterfeit drugs. In 2005, the FDA intercepted prescriptions that patients ordered from Mediplan, which was advertising itself as a Canadian-based pharmacy. Upon inspection, more than three-quarters of their orders came from several other countries. Stempler now faces wire and mail fraud charges, which could mean 20 years in prison and up to $95 million in restitution. In another case, a combined operation between Spanish police and Europol resulted in the arrests of several people operating an online pharmacy with an unknown location that imported fake medicine from Asian countries and sold these products to individuals throughout Europe.

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