CNBC SPECIAL: Ozempic Underworld 10/11/24

0:02Not far from the majestic Rocky Mountains in Boulder, Colorado is an ordinary suburban neighborhood, a quiet, tree-lined street, and this modest, light gray home. Not the kind of place you'd imagine an investigation into black market Ozempic would lead, but it did.

0:25Our look into counterfeit weight loss drugs started with purchasing Ozempic online from Labor Beauty, a company we thought was based in Colorado. What we found was that it's part of an international marketplace where criminals are either brazenly counterfeiting these drugs or buying the real thing overseas on the cheap and illegally shipping them to the U.S. to turn a profit. The main targets, Novo Nordisk diabetes drug Ozempic, Discover the Ozempic Trizone, as well as its obesity drug Wegovi, Discover the power of Wegovi, and Eli Lilly's Monjaro and ZepBound, all in a class of wildly popular weight loss drugs known as GLP-1s.

1:05from New York This is a dangerous product. to the UK So we'd like to have a guess which one is the genuine and which one is the fake. to Turkey This is a very profitable business. to China and around the world You're playing with people's safety. with serious health risks fueled by thousands of websites and social media accounts. That's just how we roll. Offering discounts big enough for some to outweigh the risks. The Ozempic we bought from Laver Beauty cost$219, while real Ozempic goes for nearly$1 ,000 for a month's supply. Wagovi is about$1 ,300, and both Monjaro and Zepbound are more than$1 ,000.

1:48Both Novo Nordisk and Eli Lilly say they're alarmed. It's a massive problem, which one has a bit of a hard time to understand how people could do this. We're worried they could be dangerous for patients who take them. We found Laver Beauty openly selling Ozempic, even featuring this promotion on Instagram. From the address listed on the website, Laver looked like a U.S. company. But what we received was this package sent via DHL with this return address. Xie Zha Zhuang, China, about four hours from Beijing. Let's open it up and see what we have. It's a plain cardboard box. It doesn't appear to have any refrigeration.

2:30although it's supposed to be refrigerated. This looks like it might have been a refrigeration pack at one point, although it's warm now. It does say Ozempic on it, one milligram. And here's the Novo Nordisk logo. And here's the pen. Looks like the real thing, but let's see what's inside. The instructions are in Chinese, and there are needles to go with the pen. Was this real Ozempic that was diverted to the U.S. or a fake? And why did it come from China when the company has a Colorado address? We'll answer that question. But first, our investigation brought us to the U.K., where hundreds of counterfeit Ozempic pens have been seized.

3:06In the murky world of black market drugs, it's hard to tell what's real and what's not. The fakes are that good. Andy Morling is deputy director of criminal enforcement for the Medicines and Healthcare Products Regulatory Agency. So would you like to have a guess which one is the genuine and which one is the fake? This one is real. The other one with the purplish pen isn't. It is to us a very crude copy, not sophisticated in any sense at all, but it's enough to make people who don't have this level of knowledge and don't have the comparison to make inject this into themselves and cause themselves significant harm.

3:41We saw that the demand increased and quite often, as often happens in these situations, criminals try and fill a gap where the supply and the demand aren't balanced for a particular product and we started seeing real counterfeit versions of the Ozempic product on the market. A total of 869 counterfeit Ozempic pens were seized, with 500 of them originating from Southern Europe before ending up in the UK. The remaining ones are believed to be purchased online. And he says all the seized pens are not Ozempic at all. They're actually relabeled insulin pens. These are completely counterfeit products manufactured somewhere, we don't know exactly where, and made to look very much like ozempic pens.

4:27Someone on a relatively industrial scale had got hold of the genuine insulin pen, removed the label and replaced it with a counterfeit ozempic label. No more ozempic seizures have been made in the UK this year because Morling believes better availability of Novo Nordisk Wigobi reduced the overall demand. Still, he has a dire warning. Don't feed the illegal market. They don't care about us. All they care about is making money off the back of people's vulnerability. Just how big is the black market for weight loss drugs? Counterfeit Ozempic has been reported in 15 countries, according to the World Health Organization, which issued a worldwide alert in June.

5:11And here in the U.S., the FDA announced last December that it had seized thousands of units of counterfeit Ozempic in the legitimate U.S. drug supply chain. FDA records also show adverse event reports for 12 cases linked to counterfeit Ozempic and Wegovy. And fighting the fakes is getting harder and harder. This is Manjaro. This is the real thing. And this is Zepbound. Dr. Daniel Skavronsky is Eli Lilly's chief scientific officer and president of Lilly Research Labs. At Lilly headquarters in Indianapolis, he shows us how deceptive the knockoffs have become. Here's one of the most sophisticated fakes that we've seen.

5:50You can see they made a box that says Manjaro. It's actually a different pen. They've kind of painted the top a little bit and they put a different sticker on it. And a totally different medicine is inside. They've just relabeled it to make it look like Manjaro. It's another drug for type 2 diabetes. It doesn't cause weight loss. It looks to all the world like Manjaro comes in a box that's labeled as Manjaro, and it has pens in it that are labeled as Manjaro, but it's not Manjaro at all. He says this sample was ordered online from Turkey. Here's one that came from Mexico. It had an FDA sticker on it.

6:27It's very official. Yeah, FDA doesn't allow people to put their name on stickers. And again, it's packaged in what appears to be actually is a legitimate Eli Lilly pen. But the drug inside the pen was something else entirely. And counterfeiters are already trying to cash in on the company's next potentially big weight loss drug, Retatrutide. It's not even on the market yet, but we discovered it's being sold on numerous websites. We're testing it in phase three clinical trials today. We don't know yet, but I hope to get those results next year. and we'll find out. You can already find that online for sale.

7:06Yeah, that's crazy. Even the real redditrutide is not ready for patient use outside of clinical trials. Just taking advantage of people's desire, you know, in this case, maybe they want the strongest medicine possible or the best possible science, and they think they're getting it, but they're absolutely not. If it's not counterfeit, it could be diverted product. At JFK's International Mail Facility, the largest in the country, intercepting diverted drugs is routine. Pharmaceuticals are only some of the nearly 60 ,000 seizures last year of all sorts of counterfeit and illegal items. This is the type of technology that we're moving towards.

7:45Sal Ingracia is the port director at JFK Airport for U.S. Customs and Border Protection. You are taking a risk when you're ordering products through the mail, through e-commerce platforms. And Gracia says officers are seeing more of the weight loss drugs double the amount from last year. This table is full of recently seized Ozempic and Wagovi, all mailed from overseas. It looks real. I mean, to somebody who's never taken Ozempic, it's pretty convincing. Yes, the counterfeits are very good. Some of these products may actually be Ozempic that was made for a foreign market and then diverted back to the United States.

8:26For the most part, the products are ordered from social media and websites and then shipped. The payoff in diverting drugs can be big, as long as list prices in the U.S. are higher than prices elsewhere. For example, the list price of Ozempic in the U.S. is$968. It's as low as$59 in China, about$200 in Turkey, and less than$100 in parts of Europe. And the profits could be even bigger if the product is stolen. So these boxes from e-commerce, are they going to individuals mostly? Consumers? So these are mostly individuals that are ordering this, going online, and looking for a deal, right? And obviously taking a big risk by doing that.

9:12But we've also seen these products being ordered by doctors' offices. Doctors' offices. Doctor offices, yes, where we've intercepted them. Before they could have been dispensed to unwitting patients. The Ozempic we ordered was just one of an untold number of packages of fake and diverted drugs that managed to evade detection. We showed it to Ingrassia. So we ordered this online. It's supposed to be Ozempic. We ordered it, by the way, and the website said Colorado. And it came from China. Right. And that's a normal tactic, to make people feel comfortable that they're ordering, they think they're ordering from the United States.

9:50This is coming from a factory somewhere in China that there could be anything in it. This is a dangerous product. We return to the International Mail Facility, where this time we're shown these seized boxes of Manjaro, again mailed from overseas. This is not destined for the U.S. market. This obviously is coming from the U.K. It probably is coming because it was cheaper. I noticed in looking at some of these boxes that some of them actually have what looks like actual prescriptions attached to them. So it was prescribed by a physician. So why is this an issue if this is exactly what the doctor ordered, so to speak?

10:28Because of the way it's being shipped, because of where it's being shipped from. And what happens to the seized items? Unless they're part of an active investigation by the FDA, Ingracia says Customs isn't currently allowed to destroy the pens because they're categorized as medical devices. In some cases, they'll be returned to sender and they'll be sent back overseas because that's the market they're destined for. It depends on the authority that we have and it depends on the product. So all of this will be sent back? All of it will be returned to the foreign market. To the sender. Who could then repackage this and send it right back?

11:05We may be intercepting these things more than once. To go after the sellers, the pharmaceutical industry teamed up with Brandshield, a cybersecurity company, to remove fraudulent drug websites. CEO Yoav Karin showed us some of the sites he says were taken down. This is a Facebook account impersonating, selling the different drugs of GLP-1s. We have another TikTok account that does that. This looks fake to me. It says 64 followers. How could it possibly be the Monjaro official page? It looks fake to you. Not everyone will notice it. Karen says Brandshield got 250 sites removed last year related to bogus weight loss, eight times the number in 2022.

11:49I don't see the scammers going away. We continue fighting them. It's like whack-a-mole. It is kind of a whack-a-mole, but we're on them, so we're chasing them. This is our technology. We find them very quickly. Both TikTok and Meta, the parent company of Facebook and Instagram, told us they do not allow the sale of prescription drugs and remove those listings. For the federal government, this is a big problem. Nicole Johnson is National Program Manager for the Intellectual Property Rights Coordination Center. We are seeing a lot of diverted medicines coming from Europe and South America. But for counterfeits, a lot of what we're seeing currently in the United States is just the reuse of old Olympic pens.

12:32So people can actually just take the original packaging and fill with saline. Are you surprised at all that counterfeiters are trying to get these weight loss drugs, fake ones, into the market? Absolutely not. Criminals are just trying to make money. Right now, Johnson says the top countries for counterfeits and diverted drugs are India, China, the U.K., Mexico and Turkey. There, she says, government-subsidized pharmaceuticals have fueled the counterfeit drug market. What criminals normally do is they find something to exploit to make more money. So the pharmaceuticals were then bought up and started to be brought out of the country and then sold throughout the world.

13:17So really something that was supposed to help people and it's been exploited.

13:25Istanbul, Turkey, may be known for the beauty of the Bosphorus, surrounded by stunning palaces and mosques, an ancient city that attracts millions of tourists every year. But it's also one of the epicenters of the lucrative counterfeit drug trade. Last fall, Turkish police conducted raids throughout Istanbul, part of a coordinated international crackdown. Among the sites raided, these gated apartment complexes and warehouse areas. It's one thing to counterfeit a luxury bag. It's a very, very different thing when you counterfeit a medicine. Maziar Mike Dostar is executive vice president of Novo Nordisk's international operations based in Zurich.

14:07How hot is Turkey as a hot spot? It is one of the so-called hot spots. And an interesting fact, I think, about that market is that we have been able to see that some of the counterfeiters are using, let's say, packaging equipment. So these are sophisticated equipments that does the packaging that are on par with the original company equipment. So they source the equipment from pretty much the same place, let's say, as we or our competitors are sourcing it. So they make the packaging look very, very similar to the original product. So let me get this straight. The counterfeiters are buying the same machines that you are using to create the packaging for their fake.

14:49Some of them. In fact, Turkey is now known to investigators as a major transit hub where counterfeit drugs are shipped to the U.S. and other countries. After the reorganization of the supply chain due to the COVID-19 breakdown, we saw some of the production shifting to Turkey. Derenç Bada is an attorney who represents major pharmaceutical companies in Turkey. We see a lot of police raids targeting weight loss, diabetes, counterfeits, diverted products, and also we see an increasing amount of online channels promoting these products. And it is forbidden in Turkey, actually, to sell these through online channels.

15:26But that's not stopping the criminals. At the JFK International Mail Facility, officers showed us this seized package of Ozembek mailed from Turkey. The counterfeiters now, many of them we see switched to promoting, selling counterfeit weight loss products. So back to that Ozempic we received from China. Order from Laver Beauty, the company with the Boulder, Colorado address. Was it a sophisticated fake or a product that was either diverted or stolen and resold to us? We call the number listed for Laver Beauty. Hi, this is Melissa. I received my Ozempic shipment in the mail and I had some questions.

16:05Can you give me a call, please? We never got a call back, but someone named Chris messaged me back on WhatsApp. All our products are genuine. We don't sell fake ones, he wrote. I asked, is this the same as American Ozempic from the U.S.? The product is the same, but the product entering the Chinese market needs Chinese approval, so it is a Chinese version. And it was. Novo Nordisk says the Ozempic we received appears to be diverted legitimate product and was produced for and distributed to the Chinese market during late 23 and early 24. Therefore, it would be unauthorized, unapproved for the U.S.

16:44market. The company went on to state that it cannot confirm the sterility, which may present an increased risk of infection for patients who use the counterfeit product. We go through incredible amount of discipline to make sure that our real products are transported from our factories all the way to the pharmacy's refrigerator in cold chain. And small little deviations to this temperature in the shipment and the trucks actually makes us not be able to guarantee the quality of the drug anymore. Still, one question remained. What is the connection between this house listed on the Labor Beauty website and the return address on the package?

17:21We tracked that address to this office tower in Shijiazhuang, China, up an elevator to this unmarked door. Behind it, Laver's logo on the wall. As for the address on the website, not only was it online, but it was even on corporate documents filed with the state of Colorado. And the other addresses in those documents led us to these postal boxes in Aurora, Colorado and Anaheim, California. The homeowners told us they've been getting mail for Laver Beauty, even this 1099 tax form, but they have no connection to the Chinese Ozempic seller at all, and they have absolutely no idea why the company is using their address.

18:03The Laver sales representative, Chris, told me on WhatsApp the Boulder address is the previous address of our U.S. warehouse, and he added, if I wanted to order even more Ozempic, he sent us to this webpage, offering it for$169. Laver Beauty did not respond to our request for comment. The day after we sent that request, the Colorado address was scrubbed from the website. Just one player in the black market for obesity drugs. You're playing with people's safety. Patients are putting themselves at major harm, perhaps even death, by taking these counterfeit drugs.