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Executive Summary

HILL INTEREST IN OVULEN COUNTERFEITING MAY EXPAND to an investigation of Rx drug pricing differentials -- especially the spread between HMO bid prices and levels to retail pharmacies. Rep. Dingell's (D-Mich.) Commerce/Oversight Subcmte. started investigating pharmaceutical counterfeiting last November in the wake of widespread forgery of Searle's Ovulen 21 birth control pills. The investigation began with a survey sent to pharmaceutical mfrs. asking for more information on the industry's experience with counterfeiters over the past five years ("The Pink Sheet" Nov. 26, T&G-2). Because of the intense price competition in the oral contraceptive market, the area is ripe for further investigation of differentials, beyond the counterfeiting issue. A hearing on the Ovulen situation per se could be difficult to arrange at this time since the source of the counterfeit contraceptives is still under investigation.

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