Berkeley Lovelace Jr. is a health and medical reporter for NBC News. He covers the Food and Drug Administration, with a special focus on Covid vaccines, prescription drug pricing and health care. He previously covered the biotech and pharmaceutical industry with CNBC. Insurance coverage for weight-loss drugs has recently increased, but typically only covers branded versions, according to consulting firm Mercer.
- Hospitals are paying exorbitant prices for drugs because of an insidious “gray market” pipeline.
- To measure the depth of the problem, Premier healthcare alliance, a North Carolina-based quality improvement and group-purchasing organization, sent its hospital membership a request for examples of unsolicited sales offers made by gray market vendors.
- That rabbit hole includes websites that sell GLP-1 drugs “for research only,” like powdered semaglutide or tirzepatide that’s intended for use in the lab, not for humans.
- China’s drug retail market grew by 8% between 2015 and 2019, outperforming the sector’s global growth of 6% during the same period.
- Which means they haven’t gone through the full safety gauntlet.
Because of the nature of local warranties, importers of grey sets usually offer their own warranty schemes to compensate for the manufacturers’ refusal of service. World-market pricing and the Internet have largely eliminated this. Canon gives their hard-selling DSLR cameras names like “Rebel” in the US and “EOS xx0/xx00” outside it, aimed at preventing the competitively priced US-merchandise reaching Europe where sales are slower but achieve a higher profit. Demand for these drugs has emerged globally, and the same issue over pricing is occuring outside of the U.S.
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All the websites the researchers used to purchase and test the products appeared in the top results on mainstream search engines and have millions of visitors, according to an analysis of the site traffic, Mackey told Business Insider. Their results, published August 2 in JAMA Network Open, provide some of the clearest information we have to date on what is — and isn’t — in knock-off versions of Ozempic. “Certainly it doesn’t seem fair from the perspective of a patient, and you would have to say it doesn’t seem fair from the perspective of a provider,” Smerage said. Those prepared to hand over a pedigree — or a detailed record of a products’ custody — occasionally hear from O’Neal when there’s no other choice. For a pharmacist, trying to determine a product’s supply source in such a web — let alone its origins or authenticity — can be extremely difficult.
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For smaller hospitals and clinics, however, with limited negotiating power and serving patients with lower income levels and less insurance coverage, even a modest increase in drug prices can have a significant impact. If the added expense is beyond their means, providers may be forced to purchase fewer doses and ration what they have left. Using gray-market products means you accept all legal and health risks. These products may be legal to possess, but they sit outside the manufacturer’s authorised supply chain and lack the safeguards of domestic pharmacy distribution. Last year she bought a compounding pharmacy’s version of tirzepatide, paying about $470 monthly, and had lost more than 20 pounds when the FDA announced the ban on compounded weight-loss drugs. There will always be some form of price variation between country markets and the key (albeit to a difficult puzzle) is to deliberate how the company can manage price to the point where a gray marketer does not detect a profit incentive.
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The FDA has already issued warning letters to several online vendors. After a December warning to Summit Research Peptides, the company still sells tirzepatide and semaglutide peptides but no longer includes health claims on its website. And US Chem Labs, which the FDA warned in February 2024, removed language from its website extolling their products’ weight-loss powers, though its product pages for semaglutide still include information about therapeutic uses. Of 38 websites that sold GLP-1 drugs “for research purposes,” only four asked buyers to check a box stating that they were a researcher, White’s team reported in the Annals of Pharmacotherapy last September. And none of the 38 sites verified that buyers were actual researchers. Some of the companies White and colleagues investigated display customer testimonials on their websites or social media ads trumpeting how well the products work for weight management or suggesting they could be used by humans for non-research purposes.
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The Senate’s investigation included the example of the shipment of 25 vials of a chemotherapy drug, fluorouracil, in September 2011. Priority Healthcare, a Maryland pharmacy owned by Marianna Pesti, purchased the vials from McKesson and sold them to a New Jersey distributor, Tri-Med America, which was owned by Ms. Pesti’s husband, Gabor Szilagyi. The drugs were sold five more times before they reached the end-user, Sonora Regional Medical Center in California. By the time those vials were sold to the hospital, it paid $600 per vial. We also offer an effective way to combat the online sales of fake drugs and unauthorized sellers. it is estimated that over 30% of all mobile phones traded will pass through the grey market and that statistic continues to grow. It is impossible to quantify an exact figure, but sources17not specific enough to verify suggest that as many as 500,000 mobile phones are bought and sold outside official distribution channels through their trading platforms every day.|“For a full workup for endotoxins, heavy metals and mass impurities, you’re looking at about $850,” he says. “I would prefer to go with Eli Lilly Direct, even if it cost a few bucks more, versus compounding tirzepatide myself,” he says. It costs $349 per month for the lowest dose of Zepbound (2.5 milligrams) if you buy it through Lilly Direct, the drugmaker’s direct-to-consumer site. Recent studies in the US have actually shown that drugs like MDMA, which isn’t technically a hallucinogen, could potentially be used in conjunction with psychotherapy to treat conditions like PTSD. They have also found that psilocybin, which definitely is a hallucinogen, might reduce death anxiety in terminally ill patients.|Buyers told Reuters the gray market received a boost from an FDA ruling last year that U.S. compounding pharmacies – outsourcing facilities that create drugs in shortage – must stop selling obesity medicines more cheaply than the companies that developed them. From a brand owners’ perspective, adverse situations stemming from a gray market include problems related to upholding their brand reputation with consumers and maintaining a sound relationship with the firm’s authorized distribution channel. For example, brand dilution can be a problem if the gray market resellers cannot provide after-sales service, warranty support, and/or replacement parts Nakra 2006. Nikon, the Japanese camera manufacturer, used its “Peace of Mind” campaign targeted at consumers to stress the value of buying through a legitimate supply chain and even rewarded its consumers with an extended warranty for this type of compliance Simpson 2012.}
Market Access
For one because they’re so potent, active in micro- or milligram scale, and thus seem to be quite easy to overdose on. Anecdotal claims from some people who have used them, say that they are also somewhat boring drugs to take. Sure, the walls get a bit wobbly and the colors change, but there’s none of the insight that you get from LSD or mushrooms. This, of course, varies from person to person, but I don’t think it’s the best drug class for use in therapy. They are drugs whose chemical formulas have been altered just enough so that they’re not illegal according to analogue laws, which make entire groups of drug illegal because they’re checmially similar to a known narcotic.
The idea that third-party suppliers would inflate prices, too, is disturbing, he said. Premier officials declined to identify the 18 gray market vendors who approached their members, but Forster said they sent the list to unspecified “government authorities,” but would not say which agency. Of the drugs offered by 18 gray market providers, 96 percent were double the normal price, 45 percent were 100 times the normal price and 27 percent were at least 20 times the normal price, Premier found.
- That means “a lot of nausea, a lot of vomiting, a lot of diarrhea,” he says.
- Jump into r/glpinsiders and tap the hive-mind—weekly Q&A, progress check-ins, and detailed how-to posts you can search anytime.
- Many smaller countries and markets (Croatia, for example) are still prone to grey imports of mobile phones, apparently due to very limited number of mobile phone models ever to be sold in that particular country.
- “Much like with counterfeit versions, these active ingredients come from unregulated, undisclosed sources…
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The arbitrage function of gray markets may thus have a direct, adverse impact on their earnings. Yet it involves more health concerns than medications offered through the legitimate supply chain. Highly regulated prescription medicines are part of this market. When original medications get to consumers through unauthorized distribution channels, this is in fact parallel importation or the gray market. Online retailers are often able to exploit pricing disparities in various countries by using grey-market imports from regions where the product is sold at lower costs and reselling them without regional buyer restrictions.
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Websites such as Taobao and eBay enable customers to buy products designed for foreign regions with different features or at cheaper costs, using parallel importation. The driving forces behind a heavily active mobile phone grey market include currency fluctuations, customers demands, manufacturers policies, market-specific features, and price variations. It is not uncommon for grey market traders to introduce a product into a market months in advance of the official launch.
The FMD requires regulatory compliance regarding serialization of prescription drugs, compliance reporting, and unique identifier for product verification. Manufacturers now must place package protection and a serialized barcode on each package that will be sent to a central European Hub. In addition, each product should be scanned and validated upon being supplied to the public, for identification and verification of authenticity purposes. It’s not clear, though, that the market is being driven only by sketchy operators.
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This led to a chain of reselling the drug through five entities (Tri-Med America, Medcare Health, DTR, International Pharmaceuticals, PRN) before reaching its final end-user, Sonora Regional Medical Center in California for the final price of $600 per vial. The analysts who uncovered this drug shortage problem interviewed one manager at a U.S. hospital who claimed that, “(W)e have no other choice … We have to take care of our patients” in order to justify paying the significantly increased price. Ozempic and Wegovy, made by Novo Nordisk, had both been on the U.S.
