When Good Drugs Go Gray
New York Times (12/14/00) Vol. 35, No. 3 p.C1; Peterson, Melody

The FDA's Office of Criminal Investigation is looking into the substantial flu vaccine gray market, which was caused by burgeoning prices and shortages of the vaccines. Gray marketers operate by establishing a pharmacy that is supposedly buying discounted drugs for nursing homes, and then selling the products for profit to small wholesalers, who in turn sell the drugs to hospitals and clinics at inflated prices. The dangers of the gray market include drugs ruined through improper shipping and counterfeiting, and drugs that are hard to trace in the case of a product recall. Stephen J. Haynes, a former criminal investigator for the FDA, asserts that pharmaceutical companies' tiered pricing system is to blame for the existence of the gray market.


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