Coronavirus vaccine scams pose a growing threat to the global economy and public health

If left unchecked, trade in counterfeit goods has the potential to grow at a time when we face an unprecedented health and economic crisis
Consumers must be vigilant amid increasing demand for vaccines and not let counterfeiters capitalise on their fear and impatience

Kristina M. L. Acri

Published: 3:30am, 21 Apr 2021

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The World Health Organization and Interpol recently raised concerns about a spike in fake coronavirus vaccines. The news came at a time when vaccine shortages are slowing the progress of immunisation campaigns in many countries.

The alarm call highlights the growing threat of illegal trade and counterfeit goods. If left unchecked, it risks allowing the illegal industry to grow at a time when we face an unprecedented health and economic crisis.

For consumers, the dangers extend beyond receiving a vaccine that offers no protection against the virus. Counterfeit products might not do what they claim, and the ingredients could cause adverse effects or interfere with essential medicines.

Substandard and falsified medicines can also create a false sense of security, leaving the individual vulnerable to infection and increasing the risk of transmission of the illness to others.

The issue with fake coronavirus vaccines is a global problem. China recently arrested the leader of a multimillion-dollar vaccine scam who made a profit of 18 million yuan (US$2.8 million) by putting saline solution or mineral water in syringes and hawking them as Covid-19 vaccines.

In South Africa, some 2,400 fake doses were seized in the Johannesburg suburbs, where police confiscated a shipment of fake masks. Three Chinese citizens and one person from Zambia were arrested in the operation.

In March, Mexican customs and military authorities discovered a shipment of nearly 6,000 fake doses of the Russian vaccine Sputnik V bound for Honduras in a private plane at Campeche International Airport. Similar seizures were also made in other Mexican states such as Nuevo Leon and Sonora.

The risk of receiving a bogus vaccine is especially high when medicines are purchased online. Cyber threat intelligence company Check Point Research recently revealed new data claiming the number of dark web ads for Covid-19 vaccines had trebled since January, with Johnson & Johnson, AstraZeneca, Sputnik and Sinopharm “brands” all on offer for a few hundred US dollars apiece.

According to Oded Vanunu, head of product vulnerabilities research at Check Point, illicit activity has exploded in the past couple of months, from just a few hundred ads for the Moderna or Pfizer vaccines to more than 1,000 for numerous brands.

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The amount of money to be made by organised criminal networks from counterfeit vaccines is staggering.

According to figures from the European Anti-Fraud Office, the various fake scams or offers accounted for some 1 billion doses of fake vaccines in the European Union at the beginning of April, worth an estimated 14 billion euros (US$16.8 billion).

The Covid-19 pandemic has taken at least 59,000 lives across Southeast Asia, pushing health care systems to breaking point.

As a result, business supply chains are disjointed and law enforcement and border agencies are stretched, allowing criminal networks to strengthen their hold on the black market.

Not only do counterfeit and substandard goods pose an enormous threat to public health, they also rob the global economy.

The counterfeit goods market in Southeast Asia alone was worth US$35.9 billion in 2018, according to a paper published by the EU-Asean Business Council, with US$3.3 billion in tax revenue lost annually from smuggled cigarettes.

A juvenile bearcat, seized by Indonesian authorities during an anti-smuggling operation, is seen with suspects in the background during a press conference announcing the seizure of trafficked exotic animals in Surabaya, on March 27, 2019. The illicit trade in pharmaceuticals is following a well-trodden path. Photo: AFP

In a world of convergence, the illicit trade in pharmaceuticals is following a well-trodden path that was once the preserve of narcotics, arms, human trafficking, illegally harvested timber, endangered wildlife, gold and other natural resources, alcohol and illicit cigarettes.

To understand the scale of the problem, the International Chamber of Commerce predicts that global counterfeit trade will reach US$4.2 trillion by 2022, primarily fuelled by e-commerce.

Without effective public policy and more stringent law enforcement, it is reasonable to suggest that the illicit trade in pharmaceuticals will probably go the same way as illicit tobacco.

At a time of increasing demand, we must not let the counterfeiters capitalise on our fear and impatience. Consumers must be vigilant and policymakers proactive.

The promising vaccines becoming available provide hope that the end of the pandemic is in sight, but only if the public is treated with safe and effective drugs in the form of legitimate vaccines.

Dr Kristina M. L. Acri, née Lybecker, is an associate professor of economics at Colorado College and a senior fellow at the Fraser Institute