CHICAGO – A small Skokie, Ill.-based technology company is targeting the multibillion-dollar counterfeit drug business by being able to identify every manufactured capsule, tablet and vial.

“We can encode a million tablets in an eight-hour shift without slowing normal production,” said James Hussey, chief executive of NanoInk Inc., which specializes in nanometer-scale manufacturing for the life science and semiconductor industries.

An estimated $40 billion in counterfeit pharmaceuticals enters the supply chain each year, according to a 2006 report from the World Health Organization. NanoInk’s technology enables a pharmaceutical firm to encrypt a pill with information such as where and when it was made, as well as an expiration date and dosage strength, that are visible only through the start-up’s proprietary equipment.

At least one pharmaceutical company hopes to use the technology following its approval last month by the Food and Drug Administration, but Hussey said he cannot discuss the names of NanoInk’s clients.

“We are in discussions with several pharmaceuticals (companies) about our product,” he said. “Counterfeiting is a huge problem in that industry not only because of economics, but also because of the threat to human health when patients get counterfeit drugs.

Pharmaceutical companies package their pills distinctively, but counterfeiters can do a good job imitating the look and feel of the drugs and their packages. NanoInk’s invisible branding allows a drug company to authenticate and track its product at any point in the distribution channels. When a product doesn’t bear the NanoInk encryption, the companies could find out where and when substitutions were made.

Such discoveries also could aid in the prosecution of counterfeiters.

“We see our product as helping other industries where counterfeiting is a problem, such as automotive and airline parts,” Hussey said. “We’ve also been in discussion with some governments about using our technology for currency.”

Based on research led by Chad Mirkin, who heads the nanotech center at Northwestern University, NanoInk’s technology uses molecules of various substances to “write” on surfaces such as pills and silicon chips either individually or in repeatable patterns.

The company is so confident that its nanoencryption business is commercially viable that it has established a division, NanoGuardian, to market the products.

“NanoInk’s technology is very broad,” Hussey said. “NanoGuardian will focus on selling commercial products to thwart counterfeiting. As we come up with other commercially viable products, we may create other units to market them as we continue to focus on new products in nanotechnology and biotechnology.”

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AP-NY-07-30-08 0853EDT

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