NCBiotech Portfolio Company Verinetics Expands Anti-Counterfeiting Reach

Research Triangle Park-based CertriRx recently started doing business as Verinetics. But the young company hasn’t changed its focus, or the speed with which it is making inroads in anti-counterfeiting technology.

In August, Verinetics announced a partnership with India’s ACG Inspection (ACGI) to provide multi-factor authentication—MFA—to customers in the global pharmaceutical industry. MFA uses several types of verification to make sure the products that reach consumers are authentic and safe. As part of the agreement, Verinetics will combine its patented software product TraxSecur with ACGI’s own track-and-trace technology. The added layer of security will make it harder for counterfeiters to introduce fake or contaminated medicines into the product supply chain.

With counterfeiting on the rise, anti-counterfeiting technology addresses an essential international business need. Fake products not only affect companies’ bottom lines, they also put the health of millions of consumers at risk. 

While forecasts vary, the International Chamber of Commerce and several globally focused law enforcement agencies estimate that counterfeit goods account for seven to eight percent of the world’s trade. That’s more than $500 billion in lost sales annually. Counterfeiting and piracy are projected to drain a staggering $4.2 trillion from the global economy by 2022.

The pharmaceutical industry has an even greater problem, on a percentage basis. An estimated 10 percent of all medicines are counterfeit, which costs manufacturers close to $75 billion each year. Even more troubling is the significant loss of life attributed to fake or contaminated drugs. The International Criminal Police Organization (Interpol) estimates that these products cause more than one million deaths annually.

So the technology the Verinetics/ACGI partnership provides is not only business critical, it also can be life-saving. And while ACGI will use TraxSecur as an important weapon in its pharmaceutical anti-counterfeiting arsenal, the software can be deployed in many other industries—from electronics and auto parts to clothing, food and beverages. 

TraxSecur uses a data-carrying authentication mark that is part of a package’s labeling. It can easily be checked with a mobile phone camera to validate a product anywhere in the supply chain. And the mark sends an electronic warning if someone tries to alter it, which serves as a deterrent to tampering. 

ACGI CEO Ettore Cucchetti said his company’s partnership with Verinetics is a significant step toward addressing a serious problem that plagues the global pharmaceutical industry. Verinetics CEO Dr. Tom Mercolino, Ph.D., agreed. “We applaud ACGI for recognizing the importance of TraxSecur’s multilayered approach for deterring supply chain fraud,” he added.

Verinetics and NCBiotech

Verinetics has made substantial progress since its creation about a decade ago when its underlying intellectual property was spun out from Johnson & Johnson. The company—then known as CertiRx—set up shop in 2010 in the First Flight Venture Center, a technology incubator in Research Triangle Park. The North Carolina Biotechnology Center provided a $30,000 Company Inception Loan at the time. NC Biotech also helped boost Verinetics' development with a $247,270 Small Business Research Loan in 2012, followed by a $170,700 Strategic Growth Loan in 2014.

Those investments have paid off. Verinetics continues to grow as it works on new and even more advanced anti-counterfeiting technologies.