Fewer Online Pharmacies, But Web Rankings Rise for Those Remaining, Study Says
Competition among online pharmacies appears to be shrinking slightly while those remaining become more popular, said brand-monitoring company MarkMonitor’s Brandjacking Index, which tracked six different drug brands in July. The study didn’t point fingers at search engines and their pharmacy-verification service of choice, PharmacyChecker.com, as did recent reports by LegitScript that claimed to find widespread violations of U.S. law on supposedly vetted sites (WID Aug 20 p1). MarkMonitor instead pointed to the role of online business-to-business exchanges in supplying bulk quantities of branded pills and “active pharmaceutical ingredients” (APIs).
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Sites that cybersquatted on the six brands grew 9 percent over 2008, to 19,000, the study said. “Lifestyle” drugs account for 75 percent of cybersquatting activity, followed by sleep aids and anti-anxiety medication at 7 percent each. But the number of online pharmacies has fallen steadily, from 3,160 in 2007 to 2,986 in 2008 and 2,930 in 2009. Estimated yearly sales from the sites also fell to $10.7 billion from $12 billion last year, and the average traffic per site fell by more than half to 42,000 daily, MarkMonitor said. But the percentage of those achieving a rank on Amazon.com’s Alexa service, which tracks site visits by Internet users who have installed the Alexa toolbar, has nearly doubled, to 68 percent in 2009 from 36 percent in 2008, the study said.
Only four Internet pharmacies are certified by the National Association of Boards of Pharmacy under its VIPPS program, the same as in 2007 but up from two in 2008. Of 186 advertisers for the six brands, only 19 had VIPPS or Canadian International Pharmacy Association certification, MarkMonitor said. In a bit of good news for besieged PharmacyChecker.com, the study noted that one such pharmacy advertising on a “major search engine in the U.K.” was actually listed as a “rogue” by PharmacyChecker.
Citing a “marked departure from earlier studies,” MarkMonitor said protection of customer data had exponentially improved. Only 5 percent of Internet pharmacies were “incapable” of protecting data, down from 64 percent in 2008. That’s largely because pharmacies are using SSL technology to encrypt traffic, though the study said that change could have come from SSL being offered in “default hosting plans.”
Drug prices at illicit pharmacies are up to 90 percent below those at established and certified pharmacies, the report said. For one brand tracked across the VIPPS- certified and noncertified pharmacies, the average certified price was $14.16 while noncertified prices ranged from 70 cents to under $5, MarkMonitor said -- “a strong indicator that the drugs being offered … are of suspicious quality.”
The U.S. still leads in hosting online pharmacies, though its share has fallen to 36 percent this year from 49 percent in 2008, the study said. Germany and the Netherlands largely took U.S. share with their increases to 13 percent and 10 percent. But China has overtaken the U.S. since last year as the source of spam that advertises online pharmacies, hosting 31 percent of spam landing pages compared to the U.S. hosting 22 percent. The U.S. hosted 48 percent, and China 4 percent, in 2008.
The number of B2B exchange listings for bulk branded pills grew 23 percent to 652 in 2009, a slight slowing from 2008’s 36 percent growth. But listings for APIs grew more than 80 percent to 416, MarkMonitor said. Nearly half the listings for the six drugs came from China, followed by India at 17 percent. In a marked reversal, only 10 percent of listings didn’t specify the country of origin, in contrast to 81 percent last year. Some suspicious sites sold generic versions of patent-protected drugs, while others offered a variety of unrelated branded goods such as clothing and sunglasses, the study said. Online fraudsters have a “growing supply chain, professional promotion and best practices in e-commerce at online pharmacies,” MarkMonitor said.