Chennai Corner

A New Drug Scam 
Chennai has earned, rightly, the reputation for being the hub of medical tourism. For years people from other parts of the country and world have been heading here with the faith that a panacea for their respective ills resides in this city among its doctors and in its hospitals. It is also fast showing the way to the rest of the country that organ donation by grieving families can provide a new lease of life for a family that has lost all hope for the survival of a sick member.

But what is not good is that Chennai and Tamil Nadu are going down in the record books for having a footprint whenever any medical scam breaks out. For years, the kidney racket has flourished where doctors and hospitals have made money hand over fist at the cost of poor people.

The latest medical scam to hit Tamil Nadu is a drug racket where crores of rupees worth of medicines, which were past their sell by date, were repackaged with new expiry dates and re-sold in the market. A doctor once told me that most medicines are chemicals and usually remain the same even after the date of expiry. But some drugs change composition completely when their shelf life ends and could become poisonous - or useless and probably just have a placebo effect. But the point is that you and I pay good money for medicines we buy. Incidentally, most of the drugs in the latest scam had expired well before 2008. Some of them had expiry dates going back to 2006, police said.

Pharmacies would seem to be the latest sunrise business going by the number that have sprouted everywhere. In fact someone who launched a speciality medical magazine at the height of the recession, laughingly admitted: “There’s no recession here. In fact recession means medical woes pile up and that means the medical business booms.” Cynical but true.

A very high price
The recent swine flu scare, said a doctor working in community health, was fanned by pharmaceutical companies to launch their vaccines, medicines - not to mention sanitisers to wash your hands with - amounting to millions of dollars. The panic across India, raised to fever pitch by television news channels, benefited the pharma companies here. 

For years these companies have been rapped on their knuckles for lavishing doctors with expensive gifts and trips abroad under the guise of attending conferences or seminars so as to get recommendations for their formulations. This nexus is the worst kept secret and finally some action is being taken against doctors and companies involved in this I’ll - scratch - your- back - if - you - scratch - mine deal.

The irony is that the latest scam, in addition to costing sick people crores of rupees has also cost pharma companies big money. Just as piracy in the film industry costs the producers. The difference is that in film piracy, the customers end up paying far less. In this case, though, they not only pay the full price for the expired but repackaged drugs, they could even pay the price of their lives.

From rags to riches
How does 45-year-old Meenakshi Sundaram, the prime accused in the expired medicines scam who surrendered before the George Town police on March 26, sleep at night? Sundaram reportedly distributed medicines past their expiry date that included 14 top brands of drugs to 300 shops and even some top hospitals.

He began his career as a “peddler of drugs” (as salesman of pharmaceuticals are called jokingly) earning a few thousands in 1994 but became a serious drug peddler by 2010 with assets that included three palatial houses valued at Rs 400 crore. Sundaram, who paid an income tax of Rs 45 lakh last year, had an overdraft account of Rs 31 crore and even owns a Rs 30-lakh Mercedes Benz. He has revealed that he was even planning to set up a drug manufacturing unit. During his interrogation, Sundaram also confessed that there were 30,000 different medicines he was dealing with but only specific brands were manipulated before being sold.

His arrest unearthed the scam where medicines being sent to dumping yards for destruction ended up in chemist shops with a fresh expiry date because there was a network of people right from the garbage yard to pharmacies that were involved in the scam. “Not just the network of persons who are involved in manufacturing, supply and sales but also the bigwigs behind the scam should be punished,” CPM legislator C Govindaswamy demaned in the assembly this week when opposition members pointed their finger at the state drug control authority for the flourishing racket. But will the scamsters be brought to justice? The answer lies in what has not happened to various alleged scamsters -- from the fodder scam involving Lalu Prasad Yadav, to the recent mining one involving Madhu Koda.

Dumped Drugs
Garbage dumps usually overflow with plastic bags, the bane of the green brigade. But since the uncovering of the scam, garbage dumps are one of the places where medicines well past their expiry date are ending up. This time it is not to get new labels and end up on shelves in pharmacies but to be destroyed so those involved in the scam won’t be detected. Roadsides are among the other places where you will find piles of medicines as happened in Karur where medical shops threw the expired medicines after the crackdown on pharmacies. In Tenkasi a blaze was set off to destroy a huge quantity of expired drugs. In suburban Chennai, residents of Puzhuthuvakkam found sacks of medicines discarded in a nearby lake bed. Similarly, dumped medicines were also found on Red Hills bypass road.

The bigger racket
Incidentally, an industry source says the expired drug scam is just a minuscule part of a multi-crore rupee racket in which a parallel spurious drug trade is flourishing across the country. The Central Crime Branch is investigating a scam of a much larger proportion involving counterfeit medicines for over a month now. An executive of Apex Laboratories, which found one of its drugs pirated, admits, “We are only a Rs.150 crore company whereas there are much bigger majors in the pharma industry who have suffered intrusion by fake products. This is getting to be a serious problem for the industry and, worse still, for the patients.”

Meanwhile, the CB-CID recently filed an affidavit against S. Srinivasan of Chennai, P. Kannan of Kumbakonam and Hemanth Kumar Jain of Chennai before the Egmore court to interrogate them in custody. What is well- known is that there are manufacturers of spurious drugs in Hyderabad and Vijayawada in Andhra Pradesh, Bengaluru in Karnataka, Kumbakonam, Vellore and Chennai in Tamil Nadu.

Fake medicines constitute nearly a fourth of the Rs 40,000 crore Indian pharma retail business. And Delhi appears to be the hub of the illegal drug manufacturing trade. The fake Zincovit found in Chennai some weeks ago was manufactured in Delhi