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Volume 5, Issue 3
February 17, 2006

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Is industry facing a paper-based requirement after all for tracking product through the supply chain?

Since companies seem unlikely to meet FDA's deadline for implementing epedigree solutions with RFID technology, the agency might yet require a paper-based system to fulfill the requirements of the Prescription Drug Marketing Act of 1988.

Were FDA to take that approach, the paper solution would push companies toward RFID adoption, said Alan Goldhammer during an FDA workshop on RFID February 8-9. Goldhammer is associate vice president, regulatory affairs, Pharmaceutical Research and Manufacturers of America (PhRMA).

"While some have argued it is burdensome, [a paper-based mandate] will act as a powerful incentive to develop electronic solutions," Goldhammer said.

"PhRMA believes that implementing a pedigree requirement, even a system relying on paper records, is the single most-effective action FDA could take to combat prescription drug counterfeiting in the short term," he said.

FDA is seeking to implement PDMA provisions that include wholesaler pedigree and recordkeeping requirements. A stay of a final rule the agency issued in 1999 expires December 2006. In the meantime, FDA has encouraged the voluntary adoption of RFID for meeting the PDMA goals.

As late as February 2005, FDA noted that companies have made "tremendous progress" in RFID. Yet FDA associate commissioner Randall Lutter said in November that "at this point, we have become concerned about the slow or inadequate progress implementing an electronic pedigree. We are concerned that widespread adoption may not be realized by December 2006, when the PDMA stay expires."

"We want this to succeed, and we continue to believe that widespread adoption is feasible in the very near future," he said.

Workshop participants cited high infrastructure costs, technology issues, and a lack of standards as obstacles to widespread RFID use in the near term.

"Pharmacy companies have initiated pilots, but they are by and large limited to one specific product. The large-scale adoption of RFID is still years away. We have been cautioning FDA for some time that this will be a gradual process of adoption," says Goldhammer.

"The people from the pharmacy community were nearly unanimous in saying the technology for RFID is not ready. There is not one standard in place today for RFID for the pharmaceutical supply chain," says Scott Perlowski, vice president of industry affairs, National Association of Chain Drug Stores, a workshop panelist.

A year after issuance of the Gen 2 tag and reader protocol standard "there still isn't a production quality or quantity tag in the market. [And in any case,] we don’t believe that UHF is the frequency that will be used in the pharmacy supply chain at the item level," Perlowski adds.

PhRMA favors initial emphasis on package authentication when coded product is dispensed at pharmacies. Electronic pedigrees for recording each trade would be built out as technology is adopted.

"Focusing on the dispensing site permits electronic authentication systems to be implemented in a timely manner, benefiting patients, in the earliest stages of development. In later stages, electronic authentication could be expanded throughout the distribution system to cover all trading partners," PhRMA said in a white paper.

Retail pharmacy though has said it can't justify product authentication costs. Besides the cost of readers, code verifying by pharmacists and pharmacy technicians would add "a huge amount in labor costs. [And] many of our stores do not have Internet access," says Perlowski.

Perlowski says that supply chain links have recently been strengthened with retailer requirements that wholesalers certify product purchased from manufacturers. Many manufacturers have contracts with wholesalers saying that they will only buy product directly from the manufacturer.

"Companies are legally and contractually bound to understand how many times product changes hands. There have been a lot of changes to the supply chain to make it significantly tighter. In an era where pharmacy margins are being squeezed to unbelievable levels, our members just don't see the need for [authentication technology]," he says.

As FDA's 2007 goal approaches, the time for voluntary measures may be over.

Acting Commissioner Andrew von Aschenbach at the workshop asked the agency's Counterfeit Drug Task force to report by May on how the agency should move ahead.

Perlowski for one doesn't see FDA embracing a paper-based solution. "I don't think that is a starting point. FDA knows a paper pedigree is impractical and burdensome," he says.

One thing is clear. Industry and FDA have made progress in areas, including improved business processes, wholesaler licensing, innovative packaging, and active agency enforcement, besides pilot testing of epedigree solutions, and RFID. As Goldhammer told the workshop, the goal for a safe and secure supply chain requires, not a "magic bullet," buy rather a systems approach.


David Vaczek

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