Auto Spare Parts

• According to a report by the Federal Trade Commission (FTC), counterfeiting is estimated to cost the global automotive parts industry US$12 billion per annum in lost sales; of this total, US$3 billion is in the US.
• It is also estimated that lost sales in the auto parts industry in the US correlates to potentially 200,000–250,000 fewer manufacturing jobs.
• More than 80% of goods seized at US borders are produced in China.
• An estimated 30% of products sold in mainland China are counterfeit.
• A 2006 Frost & Sullivan report is not optimistic about the future, which is reflected in its projection of losses as high as US$44.7 billion to the global auto industry.

Our findings suggest that counterfeit automotive components account for approximately 35% of the aftermarket, which is estimated to be around INR 247.5 billion (US$5.5 billion). Given that the scale of the problem is enormous, the losses and other effects are also considerably large.

RESULT OF COUNTERFEITING IN AUTO PARTS

• Deaths Loss of revenue to government is estimated at close to INR 31 billion (US$694 million) per annum.
• Employment loss due to counterfeiting is estimated at over 1.15 million jobs
• Based on primary research, it is estimated that around 20% of total road accidents in India can be either directly or indirectly attributed to the use of counterfeit automotive parts.
• The use of counterfeits resulted in 25,400 deaths and more than 93,000 injuries during 2009.
• According to estimates, the end-users are paying for an additional 109 million liters of petrol and 8 million liters of diesel per annum which can be attributed to use of counterfeit parts.

Counterfeit auto parts in Saudi Arabia

According to a auto parts supplier, up to half of all deaths caused by automobile accidents in Saudi Arabia are caused by the use of counterfeit auto parts. The parts are generally 20 to 30 percent cheaper to buy when compared to legitimate auto parts.

Counterfeit auto parts in the UAE

IP enforcement officials estimate that between 20 to 25 percent of the auto parts supply market in the United Arab Emirates is made up of counterfeit parts. The counterfeit auto parts originate from China, Taiwan, Turkey, Korea and Malaysia and are smuggled and imported into the country.

More deaths from drug overdoes than auto accidents in the United States

Research conducted by the Los Angeles Times found that more people died from overdosing on drugs than from auto traffic accidents in the United States.

In 2009, the newspaper found 37,485 deaths that listed drugs as the cause of death, higher than the 36,284 deaths from motor vehicle accidents in the same year.

Between the year 2000 and 2008, the deaths attributed to overdosing on prescription anti-anxiety drugs increased by 284 percent. Deaths from prescription pain killers increased by 256 percent, cocaine deaths increased by 68 percent, and heroin deaths increased by 56 percent during that same time period in the United States.

Fake auto parts in France

Between 5 to 10 percent of all spare auto parts in France are counterfeit.

Counterfeit auto parts losses in India

Counterfeit auto parts in India causes losses of $1.9 Billion (87 Billion Indian Rupees) a year. In 2009, counterfeit auto parts in the country led to 25,400 deaths and over 93,000 injuries.

Counterfeit auto parts sales in China

Counterfeit auto parts in China is estimated to hit $45 Billion in sales in 2011. Out of the total global counterfeit auto parts market, China is responsible for 83 percent of the counterfeit auto parts.

Toyota seizures of counterfeit auto parts

Car maker Toyota conducted 250 anti-counterfeiting raids across the world in 2009 that resulted in 1.1 Million counterfeit auto parts being seized by authorities.

Pharma: The Facts

• Counterfeit drugs large economic and social burden.
• According to the Center for Medicine in the Public Interest, about 30% of brand-name drug sales in developing countries are counterfeit.
• Counterfeits in India comprise about 20% of the total pharma market, and largely involves popular brands of drugs for coughs and colds, vitamins, and symptomatic treatment of acute illnesses.
• Counterfeiting costs businesses $200 billion to $250 billion annually in U.S itself.
• Globally, criminal sales were estimated to total more than US$35,000,000,000 annually (2002-3 data).
• Sales of counterfeit drugs kill up to 10,000 Africans each year and create 2 to 5 percent tax losses for governments around the world.
• Fake tuberculosis and malaria drugs alone are estimated to kill 700,000 people a year. That’s equivalent to four fully laden jumbo jets crashing every day.
• According to the World Health Organization (WHO), there were 216 million cases of malaria in 2010; 81% of these were in the WHO African Region, with 91% of malaria deaths occurring there, primarily in children under 5 years of age (who comprise 86% of the victims) and pregnant women.
• About $182,000 worth of fake medicines for diabetes, high blood pressure, and cancer were seized in China, and almost 2,000 people were arrested.
• Counterfeiting poses a threat to global health and safety.

In CY 2011, incident data was analyzed with respect to seven regions of the world. Every region experienced a pharmaceutical crime incident. While there was a decline in incidents in Asia, four of the seven regions recorded an increase in the total number of counterfeiting, theft and illegal diversion incidents. In CY 2011, Asia and Latin America were again the top two regions most frequently linked to pharmaceutical crime incidents. Totals exceed 1,986 incidents because a region is included if it is the "origin, point of seizure or transit, or destination" of illegal pharmaceuticals.

Drug maker Pfizer found 20 counterfeit versions of their drugs in 81 countries in January 2009. By July 2012, the company reported finding 60 of their drugs being counterfeited in 106 countries.

Counterfeit drugs in Pakistan

The World Health Organization estimates that between 30 to 40 percent of all drugs and medicine in Pakistan is counterfeit. According to an official with a pharmaceutical organization, over 100 patients died at a single hospital due to taking counterfeit heart medications.

People in Pakistan spend up to 77 percent of their health budgets on medicines.

Counterfeit malaria drugs worldwide

A scientific study conducted by the National Institute of Health in the United States found that up to one-third of all malaria drugs taken around the world is counterfeit. The fake drugs and other poor-quality drugs are causing resistance to malaria and failure of treatment.

Around the world, 3.3 billion people are at risk of malaria. It is considered an epidemic in 106 countries. Between 655,000 and 1.2 million people die every year from Malaria.

Spread of Counterfeit Pfizer Drugs

Drug maker Pfizer found 20 counterfeit versions of their drugs in 81 countries in January 2009. By July 2012, the company reported finding 60 of their drugs being counterfeited in 106 countries.

Fake Avastin shows very little protects drug supply, Reuters

Reuters interviewed drug manufacturers, distributors, pharmaceutical security experts and regulators who identified vulnerabilities all along the supply chain and called for comprehensive measures to protect patients and punish criminals.

FDA calls for drug tracking system, Financial Times

The US Food and Drug Administration called for a national system of tracking prescription drugs throughout the pharmaceuticals supply chain as it continues to investigate how fake cancer drugs entered the market.

Brazilian pharma thieves make off with $760k shipment, Securing Pharma

$760,000 worth of pharmaceuticals was stolen when the driver of the shipment was held up and over powered by two armed men while visiting a rest area.

300,000 doses of fake medication seized in Murcia, Euro Weekly News

Europol coordinated an operation which led to the seizure of 300,000 doses of fake medication and the arrest of 6 people who are suspected of importing and distributing large amounts of dangerous counterfeit medicines in Europe.

Pharma News Links

• http://www.safemedicines.org/
• http://www.psi-inc.org/counterfeitSituation.cfm
• http://www.notofakes.com/Home/tabid/71/Default.aspx
• http://www.havocscope.com/counterfeit-drugs/
• http://www.drugwatch.com/
• http://www.fda.gov/Drugs/ResourcesForYou/Consumers/BuyingUsingMedicineSafely/CounterfeitMedicine/default.htm
• http://wwwnc.cdc.gov/travel/page/counterfeit-drugs.htm
• http://www.who.int/medicines/services/counterfeit/en/
• http://www.youtube.com/watch?v=8-awVJbzoU0
• http://www.nytimes.com/2012/08/06/world/asia/2000-arrested-in-china-in-crackdown-on-counterfeit-drugs.html

Cosmetics

Black Market Value of Counterfeit Cosmetics: $3.0 Billion

Average Black Market: $39.44 Billion

The sales of counterfeit products in Indonesia causes tax losses of up to $4.8 Billion (43.2 Trillion Indonesian Rupiahs) in 2010.

The following is the percentage of counterfeit goods that make up all sales in that category:

Product Counterfeit Percentage

- Leather products 35.7

- Software 34.1

- Automotive Parts 16.8

- Electronic goods 13.7

- Cigarettes 11.5

- Beverages 8.9

- Pesticides 7.7

- Cosmetics 6.4

- Drugs 3.5

The Interior Ministry stated that up to 60 percent of Microsoft products in use in Russia are pirated copies. 37 percent of all clothing sales in the country are counterfeit clothing, and counterfeit cosmetics consist of between 15 and 30 percent of the total market.

The Ministry stated that most counterfeits and imported into the county, with minimal production of fake goods occurring within the country.

Counterfeit goods sales in Russia totaled $29 Billion (910 Billion Roubles) in 2009. Counterfeit goods accounted for 6 percent of total retail sales in Russia in 2009.

In 9 of the key retail sectors of Russia, such as alcohol, shoes, tobacco and cosmetics, sales of counterfeit goods made up to 24 percent of all sales.

Fake cosmetics in Russia

Law enforcement officials in Russia estimated that counterfeit cosmetics in Russia make up to 30 percent of the entire cosmetics market.

Counterfeit goods in Russia

Counterfeit goods sales in Russia totaled $29 Billion (910 Billion Roubles) in 2009. Counterfeit goods accounted for 6 percent of total retail sales in Russia in 2009.

In 9 of the key retail sectors of Russia, such as alcohol, shoes, tobacco and cosmetics, sales of counterfeit goods made up to 24 percent of all sales.

Tax losses from fake cosmetics in Indonesia

Financial losses of $515 Million (4.41 Trillion Indonesian Rupiahs) occur in Indonesia every year due to the importation of counterfeit cosmetics into the country.

Fake cosmetics are the number one counterfeited product in Indonesia, with most of the counterfeit cosmetics entering the country from South Korea or China.

Counterfeits goods in Veitnam

Counterfeit goods in Vietnam account for up to 90 percent of all products purchased in the country’s retail markets.

In addition, counterfeit drugs and counterfeit cosmetics consist of almost half of all sales in Vietnam.

Counterfeit Cosmetics seizures in Europe

In 2006, the European Union seized 1.6 Million units of counterfeit cosmetics and personal care products at its borders.

Counterfeit cosmetics at EU borders

Counterfeit cosmetics seizures increased by 264 percent in 2007 on the borders of the European Union.

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According to a report by KPMG, the following are losses due to counterfeit goods in the United Arab Emirates.

• Counterfeit Food and Beverage: $9.5 Million
• Counterfeit Cigarettes: $15.49 Million
• Counterfeit Household Products: $3.4 Million
• Counterfeit Auto Parts: $476.8 Million
• Counterfeit Pharmaceutical Drugs: $1.3 Million
• Counterfeit Cosmetics: $37.7 Million

Total losses to counterfeit goods based on these products: $544.1 Million.

Spirits

Black Market Value of Counterfeit Alcohol: $1 Billion

Average Black Market: $39.44 Billion

A laboratory study at St. Andrews University found that counterfeit Scotch whiskies had less than 40 percent alcohol characteristics of authentic single malt whiskies.

Fake wines are sold in China at prices as little as $13 (90 Yuan) to as high as $5,440 (35,000 Yuan). The counterfeit wine market in China is estimated to be worth $685 Million annually.

959,486 packs of smuggled cigarettes were found in Turkey in 2010, an increase of almost 50 percent from the 448,092 packs found in 2009.

38,219 bottles of smuggled alcohol were discovered in 2010, an increase of 63 percent from the 23,459 bottles discovered in 2009.

There was also an increase of counterfeit alcohol bottles in Turkey, with 14,012 bottles found in 2010, up from the 1,062 bottles found in 2009.

616 people in 2010 and 597 people in 2009 were charged by the criminal justice system in Turkey for smuggling alcohol and cigarettes within Turkey’s black market.

Counterfeit wines in China are estimated to worth $685 Million, or 5 percent of the total wine market in the China.

Empty bottles of legitimate wines are sold on the black market at prices up to $1,500 to counterfeiters who fill the bottle with counterfeit wine.

Apparel

Black Market Value of Counterfeit Alcohol: $1 Billion

Average Black Market: $39.44 Billion

A laboratory study at St. Andrews University found that counterfeit Scotch whiskies had less than 40 percent alcohol characteristics of authentic single malt whiskies.

Fake wines are sold in China at prices as little as $13 (90 Yuan) to as high as $5,440 (35,000 Yuan). The counterfeit wine market in China is estimated to be worth $685 Million annually.

959,486 packs of smuggled cigarettes were found in Turkey in 2010, an increase of almost 50 percent from the 448,092 packs found in 2009.

38,219 bottles of smuggled alcohol were discovered in 2010, an increase of 63 percent from the 23,459 bottles discovered in 2009.

There was also an increase of counterfeit alcohol bottles in Turkey, with 14,012 bottles found in 2010, up from the 1,062 bottles found in 2009.

616 people in 2010 and 597 people in 2009 were charged by the criminal justice system in Turkey for smuggling alcohol and cigarettes within Turkey’s black market.

Counterfeit wines in China are estimated to worth $685 Million, or 5 percent of the total wine market in the China.

Empty bottles of legitimate wines are sold on the black market at prices up to $1,500 to counterfeiters who fill the bottle with counterfeit wine.

Consumer goods

Black Market Value of Counterfeit Electronics:$169 Billion

Average Black Market: $39.44 Billion

Counterfeit electronic chips and semiconductors causes losses of up to $169 Billion a year to the electronic industry, according to a report by IHS.

In 2011, there were a reported 1,363 separate incidents in the electronics manufacturing industry of counterfeit parts entering the supply chain around the world. The number of counterfeit parts incidents was higher than the reported 324 in 2009.

The United States Immigration and Customs Enforcement seized 24,792 items of counterfeit goods during the Fiscal 2011 year. The value of the counterfeit goods was worth $178.9 Million.

The number of fake goods seized in FY2011 was higher than the 19,959 counterfeit goods seized in FY2010.

The highest number of counterfeit goods that was seized by officials was counterfeit electronic devices, with a majority of those devices being counterfeit cell phones.

$124.7 Million of the counterfeits originated from China, representing 62 percent of the total value.

A United States Senate investigation in 2011 found about 1,800 incidents of counterfeit electronic parts being sold to the U.S. military. The incidents involved over 1 million counterfeit parts.70 percent of the counterfeit items were traced back to China.

The counterfeit parts were used on aircraft like the Air Force’s C-17 transport airplane and the CH-46 helicopter, as well as weapons systems such as the Army’s Theater High-Altitude Area Defense (THAAD) missile defense system.