Serialization: The US system is not ready for 2019Add bookmark
The recent serialization innovation summit from Adents examined how the US’ DSCSA compliance is tracking and how the Healthcare Distribution Alliance’s (HDA’s) Verification Router Service will work to reduce annual losses from the 59 million units of saleable pharmaceutical returns.
The United States has been given a total of ten years to implement serialization, with track and trace procedures to be completed by 2023.
Some requirements will be enforced by the FDA this November. Originally this enforcement was set for 2017. The results of the HDA 2017 Manufacturer Readiness Survey illustrated that very few in industry were prepared for last year’s deadline. Back when the survey was conducted, around 70% of the generic market showed they were scheduled to be ready by November 2018.
You may also be interested in our serialized guide to serialization.
Perry Fri, Executive VP of Industry Relations, Membership & Education of the Healthcare Distribution Alliance (HDA) and Chief Operating Officer of the HDA Research Foundation noted in his talk that by 2019 wholesalers need to verify serial numbers of saleable returns with manufacturers.
Questions were raised by some at the conference as to whether dispensers will be ready for their deadline ahead in 2020 or indeed may have to request for enforcement discretions.
We spoke to Perry Fri, to discuss these subjects further.
It was good to hear your presentation today. Looking at the benefits and the challenges, how has serialization impacted distributors to date?
Perry: “I don’t think we’ve made it to benefits yet, we’re still working on challenges. A couple of our members have scanned their warehouses and there is between 6% and 10% of product today that has good, readable, scannable serialised barcodes.
“The impact really can’t be felt yet. The work today is mostly around pilot projects and trying to figure out how to use the system with the product that’s available rather than having anything truly in the commercial production system.”
So the US is further ahead than the EU, what are the lessons learnt so far in the US regarding the change management that serialisation requires?
Perry: “As we have worked our way through implementation of the law and tried to understand what it requires, we’re starting to understand the complexities of it all.
“Putting a serialized barcode on a bottle - that’s not easy to do. How are we going to manage that? Are we sequentially doing that? Are we randomizing that? What’s the format of the label on the bottle? How does that go from the bottle to the case? What does the numbering system look like on that? We’ve understood the complexities there.
“Then we’ve got to verify serialized saleable returns. Initially you think we’ll just scan returns - no problem. But there’s 60 million returns that we have to deal with, and so that ended up being a much more complex problem than we thought.
“Looking toward how we do this with dispensers, the distributors are required today to provide the “3 Ts” – transaction information, transaction history and transaction statement. However, not all pharmacies know what they’re getting. The change management element is a huge hurdle - it’s education first and then it’s actually getting there and testing it.
“The two speakers talking about how they are handling it in their hospitals gave a great perspective on how truly complex it is.
“Also, it’s really different for large wholesalers versus small wholesalers.”
How ready is the US industry to meet the 2019 deadline?
Perry: “The most specific answer to your question is: the US system is not ready for 2019, but that’s what we’re working on right now. A role the HDA has taken on in part, because of the role our distributors play in the US system, has been to lead that effort to figure out how we’re going to do that.
“We went through the process to understand how we might do it. We discovered that we got nine different methods that could work. Some of them were manual and we said these aren’t going to work. Then we found two ways that could work and the Verification Router Service is one of those ways.
“We’re in the pilot process now. Over the summer we’ll actually have companies testing this. Service providers that have never talked to one another are going to create links to allow them to talk to one another. Distributors are going to make requests through those systems vendors. Manufacturers are going to be able to respond to those requests. And, hopefully, by the end of this year we will have the roadmap for a functioning, workable system.”
Many in the industry have been discussing the ROI behind serialization, heightened visibility, informing recalls, etc. However, most seem to be too preoccupied on meeting the deadlines to give this much focus.
Why are those ROI aspects a little bit tougher to reach or a little further away?
Perry: “That’s the good and bad of having a long, ten-year implementation timeline. One of the things people have talked about from the very beginning in the United States is that the incidence of counterfeit pharmaceuticals in the supply chain is extraordinarily low. However, when you look at developing countries, the challenge is much different and much greater.
“A very early part of the conversation was: why spend all of this money when we really only have a very small amount of counterfeits in the system? We had to get past that discussion, because if you can’t get past that you can’t really think about this subject.
“We have a ten-year timeline, so we can slowly work our way into it. But the problem is we’re investing over ten years before we ever get to a place where we can truly, truly start talking about ROI.
“I think ROI is going to come. I think those who are diligent about how they implement and don’t just throw things together, those that care and understand the values and standards, that integrate their systems, those people are going to reap benefits pretty early on if they can. The people that just take an off-the-shelf system, but fail to think about what it means to their processes and just do it to comply, I don’t think they’re going to get the same benefits.”