FDA responds to counterfeiting: No more holding back pedigree laws

enforcement The much, much anticipated report from FDA's Counterfeit Drug Task Force has finally arrived. At first glance, what appears to be the most significant aspect of the report is its unequivocal position that it expects manufacturers and regulated companies to comply with current and impending pedigree laws. Sara Shah, an RFID analyst with ABI Research, tells me that she sees a couple key things in the report:
  • FDA realizes that it's not going to get progress on pedigrees unless it forces the issue a bit.
  • The focus of early pedigree oversight will concern drugs that are prime targets for counterfeiters. Manufacturers of other drugs will have more of a cushion, Shah says.
  • The Agency stopped short of requiring manufacturers to implement RFID, but continues to use very strong language to encourage its adoption within the industry.
The report will "help companies formalize plans on what to implement" in terms of RFID , anti-counterfeiting and pedigree solutions, Shah says. The task force report was based largely upon the open forum that the Agency held in February, in which industry and the vendor community weighed in on a variety of topics relating to global drug counterfeiting. Clearly, the message that FDA got from the community was that the costs and challenges of complying with pedigree laws, especially for smaller businesses, do not outweigh the benefits of the laws as a countermeasure to drug counterfeiting and diversion. More analysis to come. FDA's announcement follows:

FDA Announces New Measures to Protect Americans from Counterfeit Drugs

The U.S. Food and Drug Administration (FDA) today announced new steps to strengthen existing protections against the growing problem of counterfeit drugs. The measures, which were recommended in a report released today by the agency's Counterfeit Drug Task Force, emphasize certain regulatory actions and the use of new technologies for safeguarding the integrity of the U.S. drug supply. "The adoption of the FDA Counterfeit Drug Task Force's recommendations will further reduce the risk that counterfeit products will enter the U.S. drug distribution system and reach patients," said Dr. Andrew C. von Eschenbach, the FDA's Acting Commissioner. "We must remain vigilant in our efforts to ensure our nation's drug supply is protected against an increasingly sophisticated criminal element engaging in a dangerous type of commerce." Among other new measures, FDA will fully implement regulations related to the Prescription Drug Marketing Act of 1987, which requires drug distributors to provide documentation of the chain of custody of drug products -- the so-called "pedigree" -- throughout the distribution system. FDA had placed on hold certain regulatory provisions because of concerns raised at the time about the impact on small wholesalers. Most recently, in early 2004, FDA delayed the effective date of certain regulatory provisions regarding pedigrees to allow the industry time to adopt electronic technology for tracking drugs through the supply chain. Based on information from drug supply stakeholders, the FDA had expected this technology to be in widespread use in the drug supply chain by 2007, but it now appears that these expectations will not be met. Further, FDA has not heard that the concerns raised in the past regarding the impact on small wholesalers remains, and in fact, FDA was encouraged by most drug stakeholders to allow the hold to expire. Doing so would also provide clarity in the drug supply chain regarding who is and is not required to pass a pedigree. Continuing the hold would perpetuate the current confusion and further allow opportunities for counterfeit and diversionary practices. FDA has, therefore, determined that it can no longer justify not implementing these regulations. Accordingly, the hold, which will expire in December, will not be continued. A potential new measure to safeguard the drug supply is the use of electronic track and trace technology, such as radio-frequency identification (RFID), which creates an electronic pedigree (e-pedigree) for tracking the movement of the drug through the supply chain. The FDA had expected this technology to be in widespread use in the drug supply chain by 2007. In early 2004 FDA delayed the effective date of the regulatory provisions regarding pedigrees to allow the industry time to adopt this technology. However, it now appears that FDA's expectations for adoption of the technology by 2007 will not be met. FDA therefore has determined it can no longer justify delaying implementation of the pedigree regulations. Consistent with recommendations of the Task Force, FDA also announces that, during the next year, its enforcement of the pedigree regulations will focus on products most susceptible to counterfeiting and diversion. FDA intends to announce in the Federal Register the availability of a draft compliance policy guide for public comment describing this enforcement approach. By providing guidance on the types of drugs that are currently of greatest concern to FDA, the agency intends to give wholesale distributors a better idea on where and how to focus their initial energies to come into complete compliance with the regulations (21 CFR Part 203) for all the prescription drugs they distribute. The draft guidance clarifies how FDA intends to prioritize its pedigree-related enforcement resources in 2007. FDA may, under appropriate circumstances initiate regulatory action, including criminal prosecution, for pedigree violations that do not meet the factors listed in the guidance. The Task Force report also underlines the agency's belief that widespread use of e-pedigrees using electronic track and trace technology, including RFID, would provide an electronic safety net for our nation's drug supply. The report therefore recommends that stakeholders continue to work expeditiously toward that goal, and that their implementation of RFID technology be used first on products most susceptible to counterfeiting and diversion. Additional subjects discussed in the Task Force's report include the following key issues related to electronic track-and-trace that are in need of resolution:
  • Technical aspects of the mass serialization of marketed drugs by assigning a unique identifier or serial number to each drug package as the initial step in development of track and trace technology.
  • Importance of a nationwide universal drug pedigree with uniform information in preference to state laws imposing different pedigree requirements.
  • Protection of consumer privacy to prevent unauthorized disclosure of information stored in RFID tags when RFID-tagged drug products are dispensed to consumers.
  • Consumer education about RFID and the labeling of RFID-tagged drug products, to disclose to consumers when they are receiving RFID-tagged products and to inform consumers of the benefits of RFID technology and how consumers' privacy is being protected.
The new FDA report is largely based on the Task Force's recent findings in numerous contacts with stakeholders, including a February, 2006 public workshop, request for public comment and monitoring of the latest technological developments. Today's Task Force report is the third in a series of documents exploring the means of ensuring the safety of the U.S. drug supply. The first report, issued in 2004, outlined the framework for protecting the public from counterfeit medicines, and the second report, released last year, assessed the progress toward implementing the 2004 recommendations. All Task Force Reports are posted on FDA's Web at www.fda.gov/counterfeit . -- PWT