Evolving World of Pharma: Distributors face next serialization deadline

We have looked previously at how serialization is becoming an essential offering for pharma manufacturers across the world. Ultimately, countries are united in their goals of serialization, aggregation and exchanging transaction information all the way along the supply chain. Such authentication for risk-based verification of each product, recalls, resales and returns should ensure that only safe medicines ever reach patients.

Specifically in the USA, in November 2018, the Food and Drug Administration (FDA) enforced its deadline for drug manufacturers to apply a serialized product identifier on drug packages as part of the Drug Supply Chain Security Act (DSCSA). Subsequent DSCSA deadlines will impact wholesale distributors (November 2019) and dispensers (November 2020) and, from 2023, full unit level traceability – including aggregation – will be mandatory in the USA. As the deadline for wholesale distributors approaches, we will focus here on considerations for these supply chain players.

First, it is important to note that DSCSA requirements are not entirely new to medical supplies distributors in the US pharma sector. Since January 2015, they have been complying with the product traceability aspect of serialization. However, on 27th November 2019, pharma distributors will face additional requirements that could affect how they purchase supplies, and could impact their in/outbound shipping processes.

Distributors have until 27th November 2019 to use up non-serialized stock, potentially managing a hybrid inventory system for serialized and non-serialized stock up until then. However, come 27th November, distributors will only be allowed to buy pharma products that are encoded with a unique identifier. If a product is received that does not meet the manufacturing requirements of the DSCSA, it will be the distributors’ responsibility to ensure that product is returned to the manufacturer.

This means that distributors must be prepared to verify all products received, as the DSCSA will require them to authenticate the unique identifier of all products before they are placed into inventory for sale. Typically, this will be done using hand-held scanners that will need to be digitally connected to distributor’s serialization management systems.

When the distributors are ready to ship those products to their customers, they will then need to provide tracking information downstream, to their supply chain partners, to ensure the traceability of each product continues along the chain.

As with many other topics covered in this column, the key to success lies in the digitalization of the industry. Frankly, any distributor attempting to comply with these regulations without the appropriate technology and systems in place is surely doomed to failure.

In support of this view, TraceLink – a company dedicated to software solutions for addressing serialization challenges – commented in a blog that “If you have yet to meet the 2015 lot-level requirement – or you are still relying on paper for lot-level compliance today – you will need to establish an electronic data-sharing connection with all your suppliers and customers to be DSCSA-compliant in 2019.” Clearly, that statement could be viewed as self-promoting for a company that provides these very solutions, but really – how else could a distributor meet the DSCSA requirements at hand? And even if they were able to do so, what manufacturers or dispensers would trust that distributor’s manual systems enough to agree to deal with them?

The basic message is that, with 27th November just around the corner, wholesale distributors in the pharma sector should be well underway with their serialization initiatives, if they have any intention of trading in the US. Since November 2018, when drug manufacturers were all required to apply a serialized product identifier on drug packages, distributors will have seen more and more serialized products landing in their warehouses. The smart ones will have used this opportunity to define their processes and understand how they affect their operations, ensuring full compliance once the deadline arrives.

Author biography

Sarah Harding, PhD

Sarah Harding worked as a medical writer and consultant in the pharmaceutical industry for 15 years, for the last 10 years of which she owned and ran her own medical communications agency that provided a range of services to blue-chip Pharma companies. In 2016, she began a new career in publishing as Editor of Speciality Chemicals Magazine, and has more recently taken up the role of Editorial Director at Chemicals Knowledge. She continues to also provide independent writing and consultancy services to the pharmaceutical and speciality chemicals industry.

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