Google, Microsoft, Others Join Obama to Fight Phony Pharmacies

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On Tuesday, high-tech heavy hitters--including Google and Microsoft--announced support for a new non-profit organization pledged to back the Obama administration's effort to crackdown on illegal internet pharmacies.

The group, composed of companies that service "choke points" on the internet, is being formed in response to the President's call for private efforts to police online drug peddlers, according to Bloomberg/Businessweek.

The government hopes to financially strangle the purveyors of fraudulent drugs on the internet by restricting access to credit card approvals and domain names.

Other companies supporting the effort include Yahoo, MasterCard, Visa, American Express, GoDaddy, Neustar, eNom, and Paypal.

According to the National Association of Boards of Pharmacy, an estimated 1-2 percent of drugs in North America are fraudulent, and worldwide drug counterfeiting is expected to grow from being a $32 billion industry to a $75 billion industry in 2010 alone.

"Those who sell prescription drugs online without a valid prescription are operating illegally, undercutting the laws that were put in place to protect patients, and are thereby endangering the public health," U.S. Intellectual Property Enforcement Coordinator Victoria Espinal said in a statement. "It is a real wake-up call that so many Americans have engaged in this dangerous behavior."

Counterfeit drugs are often bought via official- and legitimate-looking web sites and are dangerous because they are often composed of various substances--including everything from glue, chalk, and sugar to nearly exact chemical replicas of real pharmaceuticals.

"As the administration has made clear, no one company can solve this problem," Hilary Ware, managing counsel for litigation and regulatory affairs at Google said in a statement. "So this new cross-industry group is a welcome step forward that we are pleased to support."

The announcement of the new non-profit was made at a health and safety forum held today at the White House. Illegal online drug sellers have provided tens of millions of Americans prescription medication via the internet without a valid prescription, according to a report released at the forum by The Partnership for a Drugfree America.

"These rogue sellers have preyed upon 36 million people, or one in six Americans, exposing them to the potential of taking counterfeit and unapproved medications," the report noted.

In June, the Obama Administration submitted to Congress a strategic plan to combat intellectual property theft, including the production and sale of counterfeit medications. Since that time the OMB's intellectual property office has been working to increase cooperation between the government and the private sector to protect consumers from counterfeit medications sold on the internet by illegal online drug sellers.

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