BOULDER, COLO. — Not removed from the majestic Rocky Mountains is an abnormal suburban neighborhood, a tree-lined street and a modest light gray home.
It isn’t the form of place you’d imagine an investigation into black market Ozempic would lead. However it did.
A CNBC investigation into counterfeit weight reduction drugs revealed a global illegal marketplace where criminals either openly alter the drugs or ship the actual product from overseas — what’s generally known as drug diversion and against federal law.
The operations mainly involve phony or illegal versions of Novo Nordisk’s diabetes drug Ozempic and its obesity drug Wegovy in addition to Eli Lilly’s Mounjaro and Zepbound. All 4 drugs are in a category of wildly popular weight reduction drugs generally known as GLP-1s. The skyrocketing demand for the treatments has led to criminal schemes attempting to capitalize on the surge.
CNBC bought a drug marketed as Ozempic from an organization called Laver Beauty, which on its website and company documents listed its address on that quiet residential street in Boulder. The drug cost $219 for a month’s supply, a fraction of the list price of $968 for a month’s supply of Ozempic within the U.S.
The owners of the house in Boulder say they don’t have any connection to the corporate — though they’ve received mail and a 1099 IRS tax form addressed to Laver Beauty.
The drug CNBC purchased was shipped via DHL from an office constructing in Shijiazhuang, China, a couple of four-hour drive from Beijing. The package that arrived at CNBC headquarters in Englewood Cliffs, Recent Jersey, was a plain cardboard box with no refrigeration apart from two melted ice packs. Ozempic is alleged to be stored refrigerated. The drug packaging, which appeared authentic, featured Chinese writing and the Novo Nordisk logo.
In an email, Novo Nordisk said the drug gave the impression to be “diverted legitimate product that was produced for, and distributed to, the Chinese market during late ’23 and early ’24. Subsequently, it could be unauthorized/unapproved for the US market.”
The corporate added that it “cannot confirm the sterility, which can present an increased risk of infection for patients who use the counterfeit product.”
Law enforcement sources told CNBC that the Ozempic received from China is an element of a bigger ongoing federal investigation into Ozempic packages being shipped to the U.S.
Laver Beauty didn’t reply to CNBC’s request for comment, but a one who identified himself as an organization representative told CNBC in a WhatsApp chat, “All our products are real. We do not sell fake ones.” The person acknowledged that the product CNBC purchased was intended for the Chinese market.
The representative also messaged that the Boulder address “is the previous address of our U.S. warehouse.” A day after CNBC inquired concerning the Boulder address, it was faraway from the corporate’s website.
Counterfeit medication
The Ozempic that CNBC purchased is taken into account an illegally diverted drug. A separate but related growing problem is the rise of counterfeit drugs — fake products purporting to be the actual thing.
In the UK, authorities last yr seized a whole bunch of counterfeit Ozempic pens — insulin pens that had been relabeled as Ozempic.
“We saw that the demand increased and very often because it happens in these situations, criminals try to fill a niche where the availability and demand aren’t balanced for a selected product, and we began seeing real counterfeit versions of the Ozempic product in the marketplace,” said Andy Morling, deputy director of criminal enforcement for the U.K.’s Medicines and Healthcare Products Regulatory Agency.
Andy Morling, deputy director of criminal enforcement for the U.K.’s Medicines and Healthcare Products Regulatory Agency, holds up an actual and faux Ozempic pen.
CNBC
Morling spoke to CNBC from a warehouse outside London where the counterfeits are stored. A complete of 869 Ozempic counterfeit pens were seized in 2023.
Counterfeit weight reduction drugs have serious health risks, in accordance with the pharmaceutical firms and federal officials. In some cases they may very well be fatal to someone using them.
Eli Lilly, the maker of Mounjaro and Zepbound, said it’s actively fighting the counterfeits.
“Now we have a really elaborate and rigorous system to check medicines before they’re allowed to be utilized in patients. But unfortunately [counterfeits] don’t undergo that system in any respect,” said Dr. Daniel Skovronsky, Eli Lilly’s chief scientific officer and president of Lilly Research Labs.
Dr. Daniel Skovronsky, Eli Lilly’s chief scientific officer and president of Lilly Research Labs, shows samples of real and counterfeit Mounjaro.
CNBC
He showed CNBC a complicated fake that was labeled as Mounjaro but that contained a unique medication entirely — one for Type 2 diabetes that does not cause weight reduction.
“It looks to all of the world like Mounjaro, is available in a box that is labeled as Mounjaro,” he said. “And it has pens which are labeled as Mounjaro. However it’s not Mounjaro in any respect.”
Counterfeiters are already attempting to money in on a weight reduction drug that the corporate hasn’t even put in the marketplace yet: retatrutide. CNBC found it’s being sold online.
“We’re testing it in Phase 3 clinical trials today. We do not know yet, but I hope to get those results next yr and we’ll discover,” Skovronksy said.
Asked about sites selling what they claim is retatrutide, Skovronksy said, “Yeah, that is crazy … Even the actual retatrutide shouldn’t be ready for patient use outside of clinical trials.”
Port seizures rising
Finding fake or diverted Ozempic and other obesity drugs is common on the sprawling international mail facility situated on the grounds of John F. Kennedy International Airport in Recent York City. Greater than 60,000 seizures of counterfeit and illegal goods were made last yr at the ability.
Seized Ozempic, Wegovy and other weight reduction drugs at JFK International Mail Facility.
CNBC
“I’m not surprised, unfortunately, any of those latest form of drugs that we’re seeing, whether it’s weight reduction drugs or other drugs,” Sal Ingrassia, the port director overseeing U.S. Customs and Border Protection (CBP) at JFK, told CNBC. “We’ll see them either diverted, counterfeited or illegally shipped through this facility.”
In keeping with CBP, since Jan. 1 the agency has made greater than 198 seizures of medication labeled as Ozempic. Nine shipments of medication labeled as Wegovy were also seized, in addition to one shipment labeled as Mounjaro.
The CBP seizures data doesn’t specify how much of that medication was real and diverted to the U.S. or counterfeit.
Sal Ingrassia is the port director at JFK for U.S. Customs and Border Protection.
CNBC
CNBC showed Ingrassia the Ozempic that it purchased from Laver Beauty, the package lacking the required refrigeration, and he said it was clear the shipment had “broken the legal supply chain.”
“This to me, is something that if we see, we’re going to intercept and take motion on. This can be a dangerous product,” he said.
Ingrassia said he expects the variety of interceptions of weight reduction products to double this yr over last.
And what happens to the seized items? Unless they’re a part of an lively investigation by the FDA, Ingrassia said, U.S. Customs is not allowed to destroy them, since the injection pens are categorized as medical devices. They’re then sent back to the foreign supplier.
Illegal web sites crackdown
Ingrassia said that for probably the most part, diverted products are ordered online or via social media.
“These are mostly individuals which are ordering this, going surfing and searching for a deal. And clearly taking an enormous risk by doing that. But we have also seen these products being ordered by doctors’ offices,” he said.
To go after the sellers of counterfeit or illegally diverted drugs, the pharmaceutical industry has teamed up with BrandShield, a cybersecurity company.
BrandShield CEO Yoav Keren showed CNBC various sites that the corporate flagged and that ultimately got shut down, including a Facebook account and a TikTok account that impersonated GLP-1 makers and sold versions of the drug.
Spokespeople for Meta, the parent company of Facebook and Instagram, and TikTok said their platforms don’t allow the sale of prescribed drugs and that the businesses take motion to remove those listings.
A Meta spokesperson in an email to CNBC said, “This can be a challenge that spans platforms, industries, and communities which is why we work with law enforcement, regulators, and personal industry to combat this problem. We proceed to speculate resources and further improve our enforcement on this sort of content.”
Keren said 250 sites identified by BrandShield as related to bogus weight reduction products were removed last yr, eight times the number in 2022.
“It’s form of a whack-a-mole, but we’re on them. We’re chasing them, that is our technology, we discover them in a short time,” he said.
The Turkey connection
Counterfeit Ozempic has been reported in 15 countries, in accordance with the World Health Organization, which issued a worldwide alert in June warning of the health risks of buying fake products.
For the U.S. government, it’s an enormous problem.
“We’re seeing numerous diverted medicines coming in from Europe and South America,” said Nicole Johnson, national program manager for the Mental Property Rights Coordination Center, which fights counterfeiting. “But for counterfeits, numerous what we’re seeing currently in the USA is just the reuse of old Ozempic pens — so people can actually just take the unique packaging and fill it with saline.”
Nicole Johnson is National Program Manager for the Mental Property Rights Coordination Center.
CNBC
Johnson said the highest countries where counterfeits and diverted drugs originate are India, China, the UK, Mexico and Turkey. In Turkey, she says, government-subsidized pharmaceuticals have fueled the counterfeit drug market.
Istanbul could also be known for the fantastic thing about the Bosphorus, surrounded by stunning palaces and mosques. However it’s also one in all the epicenters of the lucrative counterfeit drug trade, in accordance with U.S. authorities who track counterfeit drugs.
“What the criminals normally do is that they find something to take advantage of to make more cash. So the pharmaceuticals were then bought up, after which sold throughout the world — something that was alleged to help people, and it’s being exploited,” Johnson said.
Last fall, the Turkish National Police conducted raids throughout Istanbul as a part of a coordinated international crackdown.
Maziar Mike Doustdar, executive vice chairman of international operations for Novo Nordisk, agreed that Turkey has turn out to be a hot spot for pharmaceutical crime.
Maziar Mike Doustdar is Executive Vice President of Novo Nordisk’s international operations, based in Zurich.
CNBC
Counterfeiters have acquired sophisticated packaging equipment that’s “on par with the unique company equipment,” Doustdar said.
“They source the equipment from just about the identical place as we or our competitors are sourcing it. So, they make the packaging look very, very, just like the unique product,” he said.
Direnc Bada, an Istanbul-based attorney who represents major pharmaceutical firms in Turkey, pointed to “an increasing amount of online channels promoting these products … and it’s forbidden in Turkey actually to sell these through online channels.”
Direnc Bada is an attorney who represents pharmaceutical firms in Turkey.
CNBC
FDA alert, complaints
Within the U.S., the FDA announced in an alert in December that it had seized “hundreds of units of counterfeit” Ozempic within the “legitimate U.S. supply chain.”
Asked concerning the status of the investigation into the counterfeit Ozempic, an FDA spokesperson said there have been no updates to the unique alert.
The risks in purchasing counterfeit drugs may be high. Given the fragile nature of the formulation and the particular shipping requirements for the drugs, consuming illegal versions may be dangerous to an individual’s health.
“It’s one thing to counterfeit a luxury bag. It’s a really, very different thing if you counterfeit a medication,” Doustdar said.
Reports of issues with weight reduction drugs containing semaglutide, the lively ingredient in Ozempic, or tirzepatide, the lively ingredient in Mounjaro, have seen a pointy rise since 2019.
“This can be a very major problem for us as a pharma company, as an industry, because patient safety is our license to operate. And also you’re fidgeting with people’s safety,” Doustdar said.
“There is no such thing as a good counterfeit,” he said.
— CNBC’s Eunice Yoon and Paige Tortorelli contributed to this report.
