BIOFEM imports and distributes over 20 name brand and generic drugs, including Glucophage (metformin), an important pharmaceutical used to improve glycemic control in adults and children with Type 2 Diabetes, manufactured by Merck Santé s.a.s. in France.
As the sole agent and strategic partner in Nigeria for Merck KGaA, BIOFEM has become a reputational proxy of sorts for the German multinational pharmaceutical company.
Failure to uphold this reputation puts BIOFEM in double jeopardy; direct loss of revenue from dwindling sales, and costs that would be incurred from having to secure the distribution rights and brand building for the products of a new manufacturer.
Insight
The problem of counterfeit medication is not unique to Merck and BIOFEM. According to the World Health Organization (WHO), counterfeit drug prevalence rates are between 10% and 30% in the developing world. Legitimate manufacturers lose close to $500 billion due to counterfeit products – $75 billion of that loss is caused by fake drugs.
From organized crime to street hoodlums, there are thousands of Nigerians making big money selling counterfeit drugs.
Problem
In 2009, BIOFEM determined that counterfeit operations had penetrated their supply chain; unlawfully manufacturing and distributing fake Glucophage medicine packs in Nigeria. While illegal operations leveraging BIOFEM & Merck’s reputations to produce inauthentic medicine had led to an overall increase in market share, sales through BIOFEM were falling.
Globally, Glucophage sales had fallen 75% since 2008, “more or less the main reason being counterfeit drugs,” according to Merck spokesperson Gangolf Schrimpf.
The Sproxil Solution
Based on proven scratch-off technology similar to mobile phone recharge cards and lottery tickets, Sproxil Defender™ is Sproxil’s innovative, consumer oriented approach to this life threatening problem. Using any mobile phone, consumers simply text a unique numeric code from their medicine pack to Sproxil’s proprietary Mobile Authentication System™ (MAS) to know within seconds, if what they are buying is legitimate or fake. The service is based on asymmetric encryption, the same technology that powers trillions of dollars in bank transfers and e-commerce worldwide.
Result
In less than three months after implementing Sproxil Defender, Glucophage sales have increased more than 10% in Nigeria and BIOFEM has seen a return on investment of over 1000%.
The Future
Other applications BIOFEM intends to use the anonymized data collected by the platform for include sales forecasting, targeted marketing promotions, and customer education. At the point of purchase and authentication, BIOFEM can offer product discounts, distribute timely product updates, and communicate virtually any other information the customer may need to know.
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