According to the United Nations Office on Drugs and Crime, the value of counterfeit goods are estimated by the Organization for Economic Cooperation and Development (OECD) to be $250 billion per year.  The International Anti-Counterfeiting Coalition (IACC) says the true figure is actually closer to $600 billion as the OECD does not include online counterfeiting that is sold in the same country it is made.  Either way, this money does not include non-monetary damage such as illness and death and the profits have been traced to organized crime and organizations known for trafficking drugs, firearms, and people.  Law enforcement has had a very difficult time keeping up with the scale and elaborate cover-up methods and by 2015, the problem is expected to grow to $1.7 trillion.

Although it might seem that individual purchases are harmless, collectively, counterfeiting has an incredible burden on society – public health is threatened by the production of fraudulent medicines, tax revenue is lost from bypassing official channels, and ironically, legitimate product prices increase in order to make up for the lost revenue from counterfeit purchases.

New York City controller, William C. Thomspon Jr., released a report stating that NYC houses a $23 billion counterfeit industry which caused the city to lose over $1 billion/year in tax revenues.  California loses $7.5 billion/year, not to mention over 25,000 jobs.  Michigan has calculated $64.7 million/year or approximately $35 million in lost tax revenue.  The lists continue.  The lost revenue could have been utilized to help schools, public services, hospitals, transportation, and police and fire departments.

According to research analysts, about 2.5 million jobs have been lost worldwide due to counterfeit, black-market activity.  Of those, 750,000 were in lost in the U.S. (Levin, 2009) and 300,000 European jobs are lost each year (Eisend and Schichert-Guler, 2006).  Research also showed that of those people who could find replacement jobs, they did so at a much lower pay.  This causes a significant impact on the unemployment rates and places a burden on state and federal welfare programs.

Counterfeit medicines are considered one of the most dangerous risks to society by the United Nations Office on Drug and Crime.  The knock-off medicines are known to have little to no active ingredients, contain harmful substances such a chalk, talcum powder, road paint, and heavy metals, and may cause unintended side effects or even death to an already unwell person.  Compounding this problem is the structure of the pharmaceutical industry – innovation is a very high-risk endeavor.  It takes 10-15 years and approximately $1.3 billion to bring a new molecule to market.  On average, only 1-2 of the 10,000 molecules synthesized in laboratories make it to market.  The continued growth in the counterfeit drug market hurts revenues and makes it more difficult for pharmaceutical companies to invest in new medicines – ultimately reducing our treatment options.

Our #1 driving force is that we can make a huge difference.  Identfide’s patent-pending solution uses NIST certified encryption with NFC technology in tags that have microchips integrated and are extremely cost effective, paper thin, virtually weightless, require no power source, and are incredibly small – about half the size of a finger nail.  We can basically put them into anything.  Verification is instantaneous and secure using smartphones.

The scope of the counterfeiting problem combined with the potential scalability of our technology make this the most exciting opportunity we have ever come across.  We have the team, technology, and capability to promote product integrity, help governments, encourage businesses, and advance innovation.