In the news this week is the story of counterfeit pharmaceutical products being imported into the United States. Some U.S. medical practitioners who thought they were buying the expensive drug Avastin at a lower price were instead sold a bill of goods: bogus medicine in bottles with faked labels.
This scam was perpetrated by foreign middlemen and brokers who have already disappeared without a trace, although it remains to be seen whether the long arm of international law enforcement will eventually catch up with them. The Roche drug Avastin is used to treat lung, colon, and kidney cancer, so faking the medicine is a particularly cruel and heartless way to steal money. But counterfeit products are very common in some areas of the world, and we’re not just talking about fake Gucci sunglasses or imitation Rolexes. In Africa, a Gallup Poll indicates a median 20% of people reported being victims of fake pharmaceutical products.
As technology continues to ramp up the speed and volume of human interaction, the world is not only becoming more interdependent, but we are also coming to depend more and more on trust. Trust between people is the lubricant for all interaction, so the more ubiquitous interaction becomes the more it requires trust. But just because trust will be a more useful quality in commerce doesn’t mean that all people can now be trusted. Far from it. We’ll still have bad actors, but policing them should be easier in the future because of interactive technology.
When Pierre Omidyar founded eBay, his original assumption was that people are basically good. Within weeks, however, his new venture nearly failed because of rampant cheating and fraud. He could have addressed the problem by hiring people to audit for fraud from some central office, but this would have been an overwhelmingly expensive undertaking, if it had even been possible.
Instead, Omidyar enlisted his own customers, who cheerfully chipped in. For free. By incorporating a voluntary ratings system that allowed buyers to evaluate the trustworthiness of sellers on an objective basis, eBay became successful. eBay is now a publicly traded company generating more than $2 billion of annual profit for its shareholders. Tens of thousands of small and large businesses rely on eBay to generate their own revenues.
Another way to use technology to reduce commercial dishonesty is to incorporate some kind of interactivity into the product itself. This is something that pharmaceutical companies like Roche ought to be seriously considering.
M-Pedigree is a smart young startup in Africa that has created a mobile-based service designed to authenticate pharmaceutical products. It has convinced some pharma companies to include authentication codes within the sealed bottles of their medicines. When you buy a medicine with this feature, you can open the bottle, unpack the authentication code, and text it to a central number for verification. You’ll either get an immediate confirmation that the medicine is genuine, or not. While mobile phones aren’t as common in Africa as they are in Western democratic economies, more than 80% of Africans still have access to at least one mobile device, whether they own it themselves or borrow it from a friend.
The whole world is getting connected. And in the inevitable future of omnipresent, 24/7 interactivity, being untrustworthy will prove to be less and less commercially attractive.
[Image: Flickr user Kevin Utting]