Counterfeit is a big problem. The bigger problem is not knowing what to do about it. But we cannot sit idle, can we? As the grey market grabs us by its claws, we embrace technology to tackle it. Since counterfeit is a major concern in developing countries, the government of India has tried to bring in strict regulations. Lately, the authorities have tried to bring in technology to improve compliance. Regulatory compliance has been a significant concern for pharmaceuticals and agricultural sectors in India. After all, fake medical and allied products can have disastrous consequences. Also, Indian pharmaceuticals rely on exports for revenue. 

Globally, the regulatory and packaging standard requirements for medicines are strict. So no doubt, it is time for India to catch up. Now let’s look at agriculture. Indian economy depends on agricultural produce. But most Indian farmers follow traditional farming methods. Given the complexity of the supply chain and the sectors, the government had to regulate these industries. It sounds good. No doubt, the intent is good. But are we getting the results? Or is it adding only to the operation cost of packaging and logistics?

Have you heard of DAVA? Have you seen the QR codes on pesticide packages?

Counterfeit production has become sophisticated. One cannot distinguish between a fake and a genuine product only by seeing. So we need the latest anti-counterfeit technology. But experts in anti-counterfeit technology warn against using technology without understanding it. Founder of ACVISS technology, Vikas Jain, says, “We need to understand the purpose of introducing new technology. Are we trying to track and trace a product? Are we looking at collating data points and making authenticity verification easy? Often government regulations like the DAVA codes create more issues than solutions. It happens because such regulations only serve compliance needs. Brands keep asking extensions for implementation because they see no value-addition.”

It is hard to argue against Vikas because some government regulations to fight fake goods are haphazard. Have you seen the DAVA website? On the one hand, it is not user-friendly. In an era where ease of use is the buzzword, slow websites are off-putting. Time is of the essence in data aggregation and data management. “Who has the time for a slow-loading website?” asks Vikas. But, if we look at DAVA codes, there are technical issues in the regulation.

What are the chief complaints from the pharmaceutical companies? Why have there been many stops in implementing the rule?

  • QR codes are not the only solution for counterfeit!

The regulation requires brands to print a simple QR code on the packages. Anybody with access to a copy machine can duplicate the code. So, if a customer scans a fake product with a copied QR code, they will get all information about the genuine product. But they will not be able to tell if the product in hand is fake or real. Vikas adds, “people feel that QR codes and simple 2D codes are a full-proof solution to fake products. But a QR code is not complex enough. Today, counterfeiters can easily replicate a simple QR code. If the idea is to use anti-counterfeit technology, then we cannot stop at QR codes. A QR code adds one more step to the packaging process. So it is a feel-good factor.”

  • But QR Codes are everywhere. Don’t we scan a QR code for online payments?

Vikas explains, “the QR code printed on a package and the one used for online transactions has a fundamental difference. The scan and pay QR codes have encrypted information and are dynamic. The unique code on a product remains the same throughout the item’s lifecycle. So anyone can copy these codes. A smartphone scan will not help tell the difference between the original and photocopy. But anti-counterfeit proprietor codes have intrinsic invisible markers. There are secure graphics and copy detection technology that prevent photocopying of QR codes. At ACVISS, we use such overt and covert markers.”

  • Even from a compliance perspective, government regulations are not good enough!

The product numbering scheme is not as per global standards. So manufacturers will need to put many product numbers on the package. The operational slow-down can impact export and add to the cost.

  • The dummy serial number fiasco is another thorn in India’s traceability journey

If we look at the pharmaceutical sector, it is diverse. Each organization has its limitations, packaging cost, and size of operations. Pesticide manufacturers also face a similar issue. Changing serial numbers or printing codes seems expensive for smaller companies. But what has been the experience of anti-counterfeit experts? Vikas says, “unique markers are not very expensive if we look at the benefits. Technology that helps track and trace products and packages provides a lot of data points to manufacturers. Even small companies can use overt and covert markers that integrate with packaging. But printing simple QR codes only for regulatory compliance is not only costly but also a costly mistake. It is a waste of resources.” 

DAVA requires brands to print serial numbers even on the primary package. So what happens if brands do not have a serial number for the primary package or product? You need to upload a dummy number on the website! Dummy serial numbers do not help in traceability. It can lead to integrity issues with data.

  • Even if the codes do not help with security, what is the issue with complying? After all, it is a start!

Indeed it is a step in the right direction. But at present, industry experts are not sure about the safety and security of the information stored on the government portals like DAVA. If you have the required digital signature, you can log on to the DAVA portal. “There can be cases where competitors can view your product-related data,” says Vikas. The price of the product must be uploaded to the portal.

Besides the above challenges, the DAVA portal needs you to upload data manually. “In the age of automation, manually uploading data is unthinkable. It is a waste of person-hours”, says Vikas. No wonder the implementation of serialization and track and trace government regulations are getting delayed. But let us give credit where it is due. Given the complexities, portals like DAVA have gone through a robust learning curve. 

Anti-counterfeit technology needs to be implemented in a phased manner. “We will go back and forth with challenges,” cautions Vikas. But it is important to look at the big picture of counterfeit. A technology implemented without understanding the nuances of counterfeit will not work. But for now, brands need to integrate government regulations with other anti-counterfeit technology. After all, the integrity and reputation of the brand depend on anti-counterfeit technology.