US$10,000. That's the price, per month, that most US customers pay for cancer treatment drugs, one of the leading killers in the United States. In fact, Americans pay thousands of dollars more than most other developed nations not only for cancer drugs but most brand-name prescriptions. For a single-family in need of these medications, the costs can be staggering—to the point that many of them may choose to forgo treatment.
Elsewhere in the world, particularly in developing nations, a different problem emerges. Drugs in less developed countries are usually cheaper, but access to medication is far more restricted. In some states, cutting-edge, life-saving prescriptions may not be available due to issues in delivery, regulatory approval, and other logistical barriers. Furthermore, even at a lower cost, these medications can still be quite expensive. As a result, access to the gold standard of international medication is limited—a perilous condition for many.
The coexisting problems of high drug costs in some developed countries and drug accessibility in other developing states have fueled the rise of a rather worrying underground drug trading market. As some cannot afford crucial medications and others cannot find them, many turn to illicit sources, which has prompted the rise of several underground, online illicit markets for prescription medications. But the unforeseen consequences of these markets stretch far beyond what one might expect.
A Secret History
In the past, the illicit market for prescription drugs was often akin to many other illicit markets—with several backdoor transactions, off-the-books sales, and other unofficial means of trade making up what was a bustling ecosystem of sellers and purchasers of such goods. With the advent of the internet, these markets gained a new and powerful tool by which they could continue growing and reach even more audiences.
The first major online expedition of the drug trade was the infamous “Silk Road,” named after the trade network connecting China to Europe in the Middle Ages. The online Silk Road was a first of its kind, online illicit market by which many illegal goods were sold to a global audience, but a large share of the market was focused on the trade of illicit or counterfeit drugs. Transactions on the Silk Road used a bitcoin-based trading mechanism that enabled buyers and sellers to trade anonymously before any transactions were converted into national currencies, while the operators of Silk Road took sales commissions.
At its height, the Silk Road financed US$1.2 billion of illegal goods trading, with a substantial portion being illegal drugs. But the size of the site drew the attention of powerful actors, including the United States' Federal Bureau of Investigation (FBI). The FBI, who has long tried to end the illegal drug trade, used a software loop to shut down Silk Road, shutting down the site and arresting its owner and founder on charges of money laundering and drug trafficking. Attempts to form a second, Silk Road 2.0, soon crash-landed at the hands of the FBI, as well.
Yet the trade in illegal drugs, remains incredibly lucrative, and the destruction of its main market, the Silk Road, only led to the rise of another: Agora. Agora was the illicit market drug's emporium in a sense—nearly 17,000 different types of illicit or counterfeit drugs were sold on the market, with over US$150,000 worth of goods sold in a single day. Additionally, the site attempted to increase its security by moving many of their operations to Tor, a darknet internet platform created for the same purpose. However, when the site began to report incidents of actors trying to infiltrate the site, the Agora admins, fearing another attack by the FBI, chose to take the site offline themselves.
As a result of these two shutdowns, the market soon made two important shifts. First, it rapidly became decentralized, moving away from concentrating within a handful of large marketplaces to numerous smaller ones. Second, the sites took advantage of issues with prescription drug access worldwide to move beyond illicit substances, building an underground market that was large and nameless. In wealthier nations, the online illicit market for prescription medications often takes seemingly innocuous forms. For example, cheap medications may be sold through online pharmacies, or even in some cases, through resale sites like Craigslist. While some might prefer buying from more reliable sources, sheer desperation is often enough to lead many to this online market, since many prescription drugs can cost a tremendous amount of money, especially in developed nations.
In the developing world, however, the online market is still largely lacking widespread infrastructure—as a result, many illicit market transactions may be facilitated via the dark web on nameless websites, but they often also require substantial in-person contact, akin to the markets of old. For many in developing states often lacking access to key life-saving medications, these markets may appear as a Hail Mary.
However, these markets are far more dangerous than many users might suspect. To start, many of the drugs in these illicit markets are counterfeits, fake drugs that can sometimes be filled with harmful substances, but most of the time, they are simply useless placebos. These counterfeits thus pose a major threat—the World Health Organization (WHO) estimates that nearly one million people die from the counterfeit drug trade each year. The counterfeiting problem becomes even more complex because of its potential for creating parallel illicit markets within already existing markets. For example, if a counterfeit drug salesperson wants to obtain a product, they may turn to the illicit market, buy the drug, and then resell the counterfeits at a higher profit margin. In fact, nearly 10 percent of the global drug supply may be counterfeits due to this behavior.
The Crime Connection
Beyond its public-health risks, the online prescription drug trade is a major source of revenue for transnational criminal organizations (TCOs). TCOs often use the revenue from these transactions to finance other operations, and the trade of illicit market counterfeit prescription drugs is estimated to produce millions of dollars in revenue for these organizations each year. With the advent of the internet, many TCOs are able to extend their services via the dark web, opening new avenues through which they can increase their annual income.
At an initial glance, it may be easy to dismiss these TCOs as merely small-scale, low-budget actors interested in turning a quick profit. This misconception, however, is a dangerous underestimation. Transnational criminal organizations have played increasingly large roles globally, often with devastating consequences. Some TCOs have used their profits to finance cyber attacks and theft operations in many developed states, wreaking financial havoc worth billions of dollars. Others, including the large-scale crime syndicates that wield immense power in Russia and China, have used their influence to create a web of corruption, a particularly dangerous network that can undermine good governance and endanger everyday citizens.
However, the largest risk appears in developing states, where TCOs play a unique role in mass destabilization campaigns against governments. In Somalia, for example, TCOs have been a key part of the effort that has led that country to a decades-long period of civil conflict and anarchy, as transnational criminal groups even claim territorial operations against the government. In Mexico and Central America, groups like the infamous Sinaloa and Los Zetas cartels have similarly been able to create destabilizing networks of influence using these profits, which have provoked numerous civil conflicts and waves of humanitarian refugees to other states.
Complicating any anti-TCO efforts, however, is that due to the degree to which TCOs are largely embedded in these states, rooting them out can be rather difficult. Thanks to the profits of markets like the illicit market prescription drugs trade, TCOs can regularly bribe government officials, shielding them from any potential for prosecution. Similarly, those profits can also finance high-profile attacks to deter civilian resistance and even provoke conflicts with rival TCOs which can devastate states as a result.
Technology has the potential to make all of these operations much worse. As millions get access to online pharmacies, counterfeit medicines and the online illicit market will likely engage increasing numbers of clients, a dangerous development that stands only to benefit TCOs and not the people of these nations. Thus, the ever-expanding TCO threat, fueled by millions of dollars worth of income, is one upon which governments must act to limit any threats to state stability.
Limiting the Trade
Given the immense risks involved, governments must take steps to crackdown on the prescription drug illicit market, especially online. Governments like the United States and those in Western Europe should use their well-developed intelligence services to listen into and shut down many online illicit markets, such as the various electronic pharmacies that exist. By targeting these markets, international actors could prevent the flow of many harmful drugs and force accountability for many of those at the top of the trade.
Second, in developing states where drugs may be made, governments must take a more active approach against the production of counterfeit medications. China in particular is one of the largest suppliers of these drugs, and many suspect that local Chinese officials collude with TCOs, shielding them from prosecution and more. As a result, it is imperative that the Chinese government make many efforts to limit this type of corruption amongst local officials and crackdown on the production of counterfeit drugs within their borders. Such efforts could help limit the rise of a more harmful online illicit market, if they remain targeted to TCOs.
The best way to limit the online illicit market is through a surprisingly simple maneuver—by draining their resources. Prescription drug pricing reforms in developed nations with high prices, for example, will remove the impetus for individuals to turn to the illicit market, weakening the power of TCOs. In other cases, international institutions and actors' efforts to improve global drug access, facilitate regulatory standardization, and contribute to other initiatives worldwide could similarly increase access to legitimate products. Ultimately, the most permanent solution to dismantling this online network will likely not come solely from a harsh crackdown that TCOs may evade but rather through measures that will rob them of their clients, rendering one of the biggest global markets without any buyers in sight.