FROM A GLOBAL PERSPECTIVE
By Catherine (Cathy) Hermsen
December 28, 2022
Catherine (Cathy) Hermsen is the FDA Assistant Commissioner for Criminal Investigations overseeing the Office of Criminal Investigations (OCI) within the FDA's Office of Regulatory Affairs. Prior to her appointment as Assistant Commissioner (formerly the director position), Hermsen served as the OCI's acting director for 2 years. She is the first woman to lead OCI in its 30-year history.
During Hermsen's 5-year tenure at the helm of OCI, the office made 1,329 arrests, resulting in 1,174 convictions. During this period, OCI also opened 315 opioid investigations, resulting in 253 convictions and billions of dollars in fines, forfeitures, and restitution. Hermsen led OCI throughout the COVID-19 pandemic, protecting the public from COVID-related fraud and other food and drug crime issues.
Instrumental in establishing an OCI position at the U.S. Embassy in London, she was responsible for expanding OCI’s collaboration and visibility with foreign counterparts, including a high-level meeting in India, a detail in Brussels with the FDA’s Office of Global Policy and Strategy (OGPS), and a conference hosted by the Organisation of Economic Co-Operation and Development.
A member of the first graduating class of the OCI Special Agent Training Program, Hermsen also served as deputy director and special agent in charge of OCI’s Kansas City Field Office. She has more than 30 years of distinguished service in federal law enforcement.
OGPS communications staff asked Hermsen to reflect on her career from an international perspective before she retires at year’s end.
Let’s explore how the changing market dynamics have changed law enforcement. As more products have been sourced abroad, has that opened the door for more fraudulent activities?
Let me answer by first putting our office into perspective. The Office of Criminal Investigations (OCI) sits at the convergence of public health and law enforcement, so the globalization of the FDA-regulated supply chain has certainly made our work more challenging in some areas. For instance, building viable criminal investigations has become more complicated as globalization and the internet have opened the doors for cases largely centered around bad actors operating out of other countries and illicit supply chains spanning multiple countries. All of these factors have grown increasingly more sophisticated, and, in fact, they have metastasized. The threat posed by opioids is a great example of this. Initially, everyone was focused on the overprescribing and the illegal marketing of opioids in the U.S., with the FDA being heavily involved in the latter. Then it was pills “flooding” our international mail facilities, and now it is illicit fentanyl products tracing back to countries like China and Mexico.
When did you start to see it?
I would say in the mid-to-late 2000s. That’s when we began to notice changes in how illegal FDA-regulated products were being distributed. There was a movement away from Conex container-sized shipments of products, toward small, informal mail shipments. There are many reasons for this: the impact of seizures is lower; it is extremely difficult to work backward through the supply chain across countries; and very little information needs to be provided regarding each shipment.
Also, the organized transnational criminal groups were no longer solely focused on distributing to consumers; they started targeting physicians who in turn passed on these products to unsuspecting patients. As the distribution model changed, so did the products. There was a distinct movement toward riskier products, in an effort for still more unrestrained profit. Often these products are intended for our most vulnerable, such as products intended to treat serious and life-threatening medical conditions like cancer or HIV.
How has it complicated your work?
It has certainly led to people encountering unsafe products, whose risks are not always fully known. The elasticity of the illicit opioids market (a critical component of this situation), the vaping crisis, and of course products associated with the COVID-19 pandemic — all of these, combined with the FDA’s overarching public health mission — have triggered a series of continuing adjustments. This has included, for example, the expansion of our international footprint, engagement with the wider community interested in global public health, and of course specialization.
This impacts much more than OCI. A great example of this is the Office of Regulatory Science’s (ORS) Forensic Chemistry Center, which is just one of the Office of Regulatory Affairs’ (ORA) specialty laboratories. Their team of world-class scientists not only focus on supporting criminal investigations, but they also work with OCI to develop cutting-edge forensic tools. We even train together, and they directly support many of our international initiatives. This has led to the establishment of specialized programs within OCI, focusing on combating cybercrime, digital forensics, import operations, and international engagement.
Has the move to internet sales had an impact, since criminals can mask their location including who and what they are? Are fraudulent internet sales largely being driven by overseas entities?
The transnational criminal groups misusing the internet to distribute illicit FDA-regulated types of products are, at the highest levels, largely outside of the United States. They are also extremely sophisticated and adept at exploiting mechanisms intended to promote legitimate commerce, such as free-trade zones, and are often associated with larger networks of related businesses profiting from this form of illicit trade, such as merchant processors who process credit card payments and drop-shippers who send and receive shipments for them.
They are also adept at leveraging branding strategies designed to make people feel safer about their products. For example, many of these rogue entities refer to themselves as “Canadian Pharmacies” even though they do not dispense medications intended for sale in Canada and the medications they distribute never even transit through that country. From our criminal investigations, we have learned that these types of illicit businesses source medications solely by price, are not reliably able to ship and store them under approved conditions, and operate outside of the FDA-regulated supply chain, avoiding the safeguards in place that protect public health.
How do you address these trends?
As you can imagine, the dual challenges posed by increased globalization and the rise of e-commerce impacted the entire FDA. One thing to always keep in mind is that the type of investigations that OCI pursues support the priorities of the agency. Further, they almost always require center-level support, and assistance from our colleagues from elsewhere within ORA.
We talked about our Office of Regulatory Science (ORS) earlier. Another key partner for us is the Office of Import Operations (OIO), whose responsibilities include identifying, forensically examining, and detaining violative imports to protect unsuspecting consumers and the integrity of the FDA-regulated supply chain. Staff from that office collaborates frequently with OCI and ORS. Additionally, the FDA has placed personnel from all three of these ORA offices together to function as a triad at our international mail facilities.
For the FDA to continue to stay ahead of these criminal enterprises, the work and activities of OCI and our other FDA colleagues need to be mutually supportive. These efforts also need to complement the work being undertaken by the Office of Global Policy and Strategy (OGPS).
As it relates to international engagement, two other factors have directly impacted our approach. First, to the best of my knowledge, no other national health regulatory agency regulates the range of products that the FDA does. So often, as an agency, even if that country regulates the associated products at all, they fall under the oversight of multiple health regulatory agencies. Second, OCI is the only fully empowered law enforcement agency embedded within a national health regulatory agency. So, we often wind up engaging with a broad range of international counterparts, including those from customs, national police, and even tax types of agencies. One impediment we often face is that our information-sharing agreements or collaborations are often limited to agencies within a particular sector such as customs agencies. As a result, we have had to seek out and foster mutually beneficial partnerships with agencies that at first blush may seem to be nontraditional partners for the FDA.
The best example of this approach is Operation Lascar, which originated from five OCI-led criminal investigations with an assist from ORS and OIO. Lascar focused on non-FDA approved, adulterated, and/or counterfeit products that successfully penetrated the FDA-regulated supply chain and were passed on to unsuspecting patients. These investigations involving targeted sales to physicians, transshipment, and the use of small informal mail shipments invariably traced back to the U.K.
Operation Lascar is the FDA’s first bilateral initiative to address this threat to public health. Lascar began in 2017 and focuses on the movement of illicit FDA-regulated products. The joint initiative started with the U.K. government, to better understand this form of illicit trade. To illustrate the point I made earlier, our primary U.K. partners are Border Force and HM Revenue and Customs, and they are customs and tax agencies. To date, through Operation Lascar we have executed five joint enforcement operations, initiated approximately 80 new criminal investigations, conducted reciprocal training, developed methodologies to exchange intelligence, and received the approval of the U.S. Department of State to post an FDA special agent in the U.S. Embassy in London.
Further, our work in the U.K. has grown to include a coalition of public health, policy, customs, police, and intellectual property agencies coalescing around this shared threat to public health.
The success of Operation Lascar also led to a similar initiative with the government of India, brokered by the U.K. government. As with Lascar, the foreign counterpart agency was outside of the traditional public health and safety sector that would ordinarily target violative FDA-regulated products originating from India. This initiative, Operation Broadsword, has included many of the same activities as Operation Lascar and includes the first joint enforcement operation by the government of India targeting violative health and safety types of products.
What is your vision of the future?
Our collective work from Operation Lascar forward has steadily grown and matured to what is now referred to as a “whole-of-governments approach” to combating crime involving FDA-regulated products. Simply put, these threats to the public’s health and safety have become too broad and too complex to be adequately addressed by a single sector or country. Protecting public health in today’s world requires coordinated efforts by multiple sectors and countries, which are empowered to use their full range of authorities, policies, and technical expertise to effectively combat these increasingly complex and sophisticated threats.
I believe as I depart from the FDA that we have laid the cornerstone for this effort. The FDA recently co-sponsored, with the Organisation for Economic Co-Operation and Development (OECD), a three-part program on a whole-of-governments approach to illicit medical products, with policy experts from the FDA’s Europe Office playing a critical role in organizing the event. FDA Deputy Commissioner for Policy, Legislation, and International Affairs, Andi Fristedt; Associate Commissioner Mark Abdoo, OGPS; and Director Duane Satzger, ORS; all directly supported the program. Without tipping our hands too much, Associate Commissioner Abdoo and I solidified a path forward following the last event, held in Paris, and the OECD concurred. This work is ongoing.
With the globalization of the marketplace, and international flow of FDA-regulated products, protecting public health now requires a more global and multinational coordinated effort to protect global public health. Accordingly, I think there will likely be a greater focus on multilateral collaboration to keep up with these ever-evolving transnational criminal groups.
The FDA has been strengthening its relationships with foreign regulators for many years, but now I think we will start to see further broadening and diversifying of these relationships in the coming years, just as we saw it happen with Operations Lascar and Broadsword. This will allow us to address emerging public health concerns more efficiently and robustly from multiple angles and across commodities and policy areas. I, for one, look forward to seeing where the FDA takes this next!