Pedigree Adopters Play the Waiting Game

March 9, 2011
Manufacturers’ electronic pedigree and serialization efforts creep ahead, slowed by FDA’s inaction.

A year ago, the pharmaceutical electronic pedigree movement seemed to be catching its collective breath. (See “The Path to Epedigree: Manufacturers Chart Their Course,” March 2010.) California had targeted 2015 as the date that drug manufacturers and their supply chain partners operating in that state would have to be compliant with e-pedigree legislation, and (this time) it wasn’t backing down, despite persistent grumbling from industry. Other pedigree/serialization regulations on the global stage were still in flux, but there seemed to a sense that it was time for manufacturers to put up, take stock, and move ahead.

Progressive manufacturers were already doing so, focusing more on product serialization as well as supply chain transparency and optimization. Still, there was a sense of foreboding. There was no single or easy way to implement electronic pedigree and serialization for most global (i.e., complex) supply chains, no overarching standards, and the decisions manufacturers needed to make differed by product and market. “It’s a manufacturer’s nightmare,” said Scott Dicks, a practice manager for Maxiom Group.

A year on, have things changed? Not really, says Dicks. There’s been some minor movement, especially in regards to the use of GS1 standards for item coding and data capture and exchange. But in the U.S. especially, says Dicks, “pedigree and serialization are not high priority in discussions between manufacturers and their supply chain partners.”

In addition, some companies have postponed pedigree initiatives, due to what Dicks calls a “deprioritization” until the regulatory picture—namely, FDA’s pedigree stance—becomes clearer. Manufacturers with new product launches, he says, are focusing on supply-chain security measures such as covert product markings and packaging protections, and forsaking pedigree/serialization “due to the added cost of the hardware, software and operations and the complexity of the communications with partners.”               

“All told,” says Dicks, “we’re making some minor progress but firm steps need to be taken by the FDA for many manufacturers to start or restart their projects.” Regardless, Dicks encourages manufacturers to be proactive in assessing product and brand security and making minor “readiness” investments, such as reserving space for barcodes on packaging. If manufacturers aren’t moving full steam ahead on serialization, Dicks says, they should at least be conducting serialization feasibility studies and developing conceptual designs. (See “2011: Progress on the Pedigree Front?” for a Q&A with Dicks.)

Solutions and Standards
The view from the vendor community is a bit more optimistic. “Manufacturers are looking for, and finding, business benefits from drug product serialization, says John Danese, life sciences product strategy director at Oracle. (Maxiom’s Dicks cites the 2010 launch of Oracle’s pedigree and serialization manager solution as a significant event from a technological perspective.) Early adopters in particular, he says, are better prepared to prevent product diversion, report incidents, reconcile recalls and returns, and maintain a better overall visibility of their supply chains.

That said, says Danese, “when the question comes up whether industry would be adopting serialization were it not for the regulatory mandates, the answer ends up being no.” Compliance—from California to Turkey to Brazil—has been the driver, he says. (For a recent interview with Danese, see “Can Drug Manufacturers Find Business Benefits in Product Serialization?”)

We’re starting to see a “migration” towards genuine efforts towards end-to-end, integrated product serialization, says John DiPalo, chief technology officer with Acsis, Inc., a supply chain software provider. From 2008 to 2010, DiPalo says, there were modest use cases, with manufacturers striving to “prove out” pedigree and serialization technologies. Now, however, the pilots have more of a purpose, he says. Manufacturers are moving from a “perfect pilot” to a “real-world pilot” scenario, he says.

DiPalo, too, sees some manufacturers looking beyond compliance towards business value. “The ability to serialize product is being seen as a competitive advantage,” he says. “If it’s a given that you’re going to serialize product, what do you do next?” Looking through the lens of business value affords manufacturers the opportunity to see serialization as much more than just a “packaging solution.”

Thanks to GS1, global standards are less of a thicket. But major differences will always exist—while the U.S. pursues pedigrees, for instance, the EU prioritizes product authentication at the point of dispensation. Regardless, standards have their limits. “I don’t think we’re ever going to have convergence of a single standard because the drivers are different—for example, for regulations in Turkey versus those for the U.S.,” says DiPalo. Regardless, he says, manufacturers have grown comfortable with the “essence” of different regulations, and are able to implement operable solutions.

Vendors are facilitating this individually and collectively. A number of vendor partnerships have sprung up in an effort to offer drug manufacturers comprehensive services and solutions. Acsis, for example, has joined Cognex, Nosco, and Omega Design in one “4 Serialization” grouping. It’s a loose conglomeration that aims to take some of the burden off manufacturers to cobble together serialization solutions.

Will FDA Finally Step Up?
In short, DiPalo says, manufacturers have many “flavors” to choose from and just need to make decisions that meet their needs. What’s stopping them? For some, it’s the sheer scale of the task at hand. “There’s a lot of work to be done!” DiPalo says.

And other manufacturers, he says, are still reluctant to go “all in” without more regulatory clarity. Amid the pedigree/serialization jostling and juggling of the past several years, FDA has mostly stayed on the sidelines.

In mid-February, the Agency held an open workshop, “Determination of System Attributes for the Tracking and Tracing of Prescription Drugs,” with attendees from all sides of the issue sitting down together. The Agency’s stated purpose of the workshop was to “explore approaches for achieving an effective and feasible track and trace system,” to obtain views from all interested parties, particularly on “system attributes and standards that would facilitate identification, authentication, and tracking and tracing of prescription drug packages.” (Slides from this workshop are now available here.)

Those who attended the meeting said that there was much confusion and hand-wringing about when and how FDA would move forward on its own standards. One report noted that Ilisa Bernstein, acting deputy director of CDER’s office of compliance, noted that the Agency will come forward with standards but declined to respond as to whether there would be mandates. She acknowledged, as reported by Contract Pharma, that FDA’s response to track and trace “has been painfully slow and we hope to kick it up a gear or two.”

“Almost every significant technological change happens because of a leadership event,” says DiPalo, who was at the workshop. There needs to be a catalyst, he argues, and that would be FDA action. The call from industry for FDA to take a leadership position on pedigree/serialization is growing in volume, he says. “I’m hoping the call was loud enough for them to say, ‘It’s time.’ ”

Global manufacturers can’t afford to wait for FDA, argues Dirk Rogers, a supply chain consultant who co-chairs several GS1 working groups. “The potential for new non-binding guidance from the U.S. is important, but perhaps less so than an increasing number of binding regulations from around the world,” he writes on his website. “Whatever the FDA—and especially the U.S. Congress—may do in the future will be important when selecting a track & trace solution, but the U.S. is only one of the countries in the world and pharma companies that do business in those other countries do not have time to wait for the U.S. to figure out their approach before making investments.”

About the Author

Paul Thomas | Senior Editor