Next Stop: Drug Pedigrees

By:  Krish Mantripragada, SAP Labs, Palo Alto

Counterfeit medicines and unlawful diversion pose a serious threat to public health and the integrity of the world's drug supply. Regulatory bodies are issuing mandates to maintain an electronic pedigree of every drug entering the marketplace to ensure safety and traceability. Radio frequency identification (RFID) offers an effective technology to support these initiatives.

Counterfeits and product shrinkage in the world's drug supply cost manufacturers 0.22-0.73 percent of revenues, amounting to $30-45 billion lost annually. In pharmaceutical counterfeiting, the supply chain is the weakest link - the only place where pharmaceutical products are not tracked at the batch or lot level. This, coupled with the numerous wholesalers, re-sellers, and secondary distributors - some with questionable business practices - through whose hands a typical drug delivery has to pass before reaching the pharmacy, makes the supply chain still more vulnerable.

Regulatory bodies are trying to tighten the due diligence and license requirements of wholesalers. Contractual tightening of the supply chain is only part of the solution. A more effective solution is to extend traceability throughout the supply chain, which is being mandated by several states in the U.S. and being evaluated by the federal Food and Drug Administration (FDA). RFID can play a key role in enabling this

traceability.

The need for electronic pedigree



The FDA released a report in February 2004 entitled "Combating Counterfeit Drugs" that includes conclusions from a study by an FDA task force and a series of guidelines for pharmaceutical companies. It recommends the implementation of electronic track-and-trace systems to combat counterfeit drugs in the supply chain. In addition to the federal government's approval of RFID, a growing number of states are enacting mandates to require their pharmaceutical wholesalers and distributors to maintain pedigrees for each drug shipped.

A pedigree is a legal document containing details of a drug consignment's history. It tracks the shipment through its entire life cycle, starting with the manufacturer and ending with the dispensing pharmacy. Florida, which led the nation in tightening pedigree requirements (with heightened requirements for pedigrees on a "specified list" of drugs), is scheduled to require pedigrees for all wholesale distributions as of July 1, 2006. 

Although RFID is not yet provided for under Florida law, a "rule development workshop" was held December 8, 2004, to begin to look at the prospects for electronic pedigrees. It is envisioned that by recording the "chain of custody" for every drug entering the marketplace, companies and regulatory bodies can establish and verify legitimacy of drugs and deter the flow of counterfeit products into the drug supply network.

Serialized traceability enabled



One effective way to combat counterfeits and similar malpractice is to uniquely identify each packaged item that is made and trace it throughout the supply chain. This unique identification can serve to authenticate both the product and all the parties involved in bringing it to the marketplace. The Electronic Product Code (EPC) is being proposed as this unique identifier. The combination of a Serialized Global Trade Identification Number (SGTIN) to track products and a Serialized Shipping Container Code (SSCC) - encoded into the EPC and carried on an RFID tag - can be a very effective way to track products and pallets, down to an individual serial number for every product.

For example, the manufacturers can serialize unit-of-use packages, cases, and pallets; wholesalers should serialize the unit-of-use packages they create when re-packaging the bulk packages provided by manufacturers. The proposed EPC as unique identifier can be coded into either a bar code or an RFID tag. The key is to incorporate the identification and tracking of products seamlessly into the various business transactions and processes.

As a specific example, before shipping products to wholesalers, the drug manufacturers can now automatically create electronic pedigrees for every serialized product during goods issue and send an advanced pedigree notice (APN) to the wholesaler similar to an advanced shipment notice (ASN). When the drug shipment is received at a wholesaler, during goods receipt, the wholesaler can automatically validate the shipment's EPC serial numbers against the APN already received from the previous drug custodian. If any discrepancies are identified, automated triggers can be set up that can initiate an appropriate course of action.

By weaving traceability and authentication into everyday transactions, RFID not only enables companies to track the flow of their goods and ensure compliance, but also to streamline operations and increase efficiency.

Enabling compliance and traceability with SAP RFID solution



SAP is well positioned with its RFID solution to help its customers in the pharmaceutical industry comply with short-term, tactical RFID pilots in response to looming state pedigree laws. SAP also provides customers with a scalable and robust RFID platform to support a longer-term, comprehensive RFID strategy to achieve business benefits across the entire supply chain.

Based on the SAP NetWeaver open integration and application platform, the SAP RFID solution can be easily integrated into an existing IT landscape - enabling customers to capture and use RFID data in both SAP or non-SAP enterprise applications. It provides a comprehensive Auto-ID infrastructure that supports:

- The handling of Auto-ID data through connectivity with readers, tags, and other devices



- RFID data aggregation, filtering, and management


- Encoding and rewriting of RFID tags


- Integration of RFID data with back-end business processes

The SAP RFID solution package also provides event management capabilities that let pharmaceutical companies:

- Track and trace EPCs across the supply network



- Receive alerts when problems are detected


- Share EPC-related data with business partners using EPC Information Services
(EPCIS).

SAP RFID solution has tight integration into other SAP modules (for example, SAP's Compliant Manufacturing module within the mySAP ERP solution), enabling companies to capture and record all the relevant data required for product pedigree tracking and achieve regulatory compliance.