TrackTrace Rx

Month: November 2016

Big Three Wholesalers Outline Their Requirements on DSCSA Compliance to Manufacturers

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In the 80s Metallica, Anthrax, Slayer and Megadeth were referred to as the “The Big 4” and “The Four Horsemen”. In the Internet world today, Facebook, Google, Apple and Amazon dominate the Internet and are also crowned “The Four Horsemen”. I’m sure in every industry you can certainly pick four big companies that monopolizes and you can easily token them as the “The Four Horsemen”. In the pharmaceutical world though, it’s the “Three Horsemen” or as they are famously coined “The Big Three”…Amerisource Bergen, Cardinal and McKesson.

But here is the problem – decades of acquisitions and mergers have shaped the patchwork quilt of an industry that is highly fragmented. The Big Three actors – McKesson, AmerisourceBergen and Cardinal Health – account for up to 85-90% of total sales for many U.S. drug manufacturers. The rest are smaller distributors that mostly follow suit, so when we talk about a unified, more streamlined approach we want to know where the Big Three stand on serialization and aggregation requirements. What they decide, is that we will follow. Like the the 80s rock bands that rocked the nation, and how Facebook, Google, Apple and Amazon command the Internet.

As the Drug Supply Chain Security Act deadlines approach, serialization and aggregation coordination efforts come to the fore. Manufacturers need to know if they will be required to develop different processes to meet unique wholesaler DSCSA compliance guidelines, or if there is a path towards a more streamlined and unified approach. The one that will let manufacturers develop once and then scale out. Again they turn to the Big 3 for guidance.

Further fragmentation is ensured by the fact that each wholesale distributor dictates its own requirements for the manufacturers to follow so that the wholesaler can comply with their DSCSA requirements.

There is hope…

Earlier this year, all three major drug wholesalers communicated their serialization and aggregation guidelines to manufacturers.

McKesson 

McKesson sent a letter to its suppliers, outlining its requirements for drug manufacturers. Here are its highlights:

GS1 EPCIS format is to be used for the serialized DSCSA information exchange.
Aggregating product from item to pack/bundle level, when applicable.
Pack/bundle level to case level, case to pallet/container level utilizing the GTIN and SSCC labeling formats.
HDMA Advance Ship Notice (ASN 865) is to be used unchanged until the Lot Level Traceability is due in 2023.

McKesson makes it clear it’s time to plan for and implement aggregation. While some manufacturers are already working on serialization, aggregation could be a more difficult task. Unlike serialization that has been a buzzing word for quite some time now, aggregation has been an unexplored territory. Based on serial number packaging hierarchy, aggregation might already be partially in place with some manufacturers, though. If your company has serial numbers on some package levels or shipping containers, you have aggregation data, at least partially.

Cardinal

Cardinal Health published its Technical Requirements for Serialization (requirements for barcodes, EPCIS serialized data exchange and master data), Upcoming Drug Supply Chain Security Act manufacturer requirements, and sent two communications earlier this year. Here are some key highlights from Cardinal serialization requirements:

Manufacturers must meet the serialization deadline in 2017, re-packagers in 2018, as wholesalers must meet the deadline in 2019 for verification of re-saleable products.
Serialized data exchange might be required by Cardinal as early as January 2019, as the company is waiting for the results of the HDA 2019 Saleable Returns Verification pilot.
Manufacturers must aggregate data from individual units to case level.
Manufacturers must use GS1 standards for product identifiers and adhere to HDMA guidelines. Manufacturers must use GTINs and GLNs in GS1 standard.

Cardinal 3PL clients will start testing serialized data exchange in June 2016.
Those Cardinal 3PL clients that seek a solution for data verification/retention requirements will be able to receive data reporting service starting September 2016.

The Technical Guide offers information for the companies interested in participating in pilot, and stresses one important detail – “Cardinal Health will not incorporate automated SGTIN validation as part of our Receiving process at this time <…> for piloting purposes our EPCIS system will be decoupled from our production receiving processes, and we will conduct pilots using our EPCIS repository in a manual and highly controlled fashion, providing feedback on labeling, aggregation quality and DSCSA content (if applicable) for each Manufacturer who participates.”

We can assume this means that during the testing Cardinal will accept your shipment even if your serialization information is not 100% accurate.

AmerisourceBergen

AmerisourceBergen (ABC) published its Serialization Labeling Guidelines and Requirements, backed by a supplier letter:

Manufacturers must follow GS1 standards and HDA guidelines for labeling on case and unit level products.
Should there be any labeling issues, ABC will provide assistance on correcting them until November 2017.
ABC will receive lot-level data via electronic ASN or via GS1 EPCIS format.
Starting early 2018, manufacturers must provide “EPCIS electronic serialized transactions and a list of standardized product identifiers for the cases & units” to ensure returns verification database accuracy.
Manufacturers must aggregate “units to homogenous cases, units to non-homogenous cases, & cases to pallets” to “meet the 2019 saleable returns obligation.”
Manufacturers must convert the NDC (National Drug Code) number to GTIN (Global Trade Item Number).

Summary

The good news is the Big Three do have a few things in common in their serialization guidelines for manufacturers:

Use of ASN format for sending lot-level DSCSA information.
Serialization of units and cases.
Use of GS1 standards for product identifiers.
Use of GS1 standards to serialize prescription drug products before November 2017.
Cardinal requires manufacturers to aggregate units- to case-level while McKesson and AmerisourceBergen require all levels of aggregation.

McKesson did not provide a set date for serialized data exchange while AmerisourceBergen set a time frame at early-2018, and Cardinal at early-2019.

Aggregation and serialization are mandated by the DSCSA with the due date in 2023, but the Big Three deadlines are set earlier. Why? The 2019 saleable returns verification deadline must be the reason. Without aggregation and serialization from manufacturers, it is logistically über-challenging to verify saleable returns. Without aggregation and serialization, verifying saleable returns would require for the wholesalers to manually open all the returns and verify each serial number with the manufacturer via phone.

HDA Pilot Study for Saleable Returns and Manufacturer Serialization Readiness Survey

(TrackTraceRx was one of the sponsors at the HDA Traceability Education Seminar in November. If you get a chance, please read our recap of the Seminar Here.)

All three stress the importance of the HDA pilot (formerly HDMA), as they expect its final report to fine-tune their aggregation requirements and enable the verification of the serialized saleable returns by November 2019.

In early-November, 2016, HDA published the results of the Pilot Study for Saleable Returns and recommended two “cost-effective and viable” scenarios to help manufacturers and wholesalers comply with the DSCSA requirements.

The first scenario suggests “a manufacturer sends aggregated product identifier only for the products purchased to each individual distributor.” When the wholesaler needs to process a saleable return, it references an internal database to verify the product identifier information from the manufacturer.

The second scenario implies there is a third-party verification router service. The manufacturer, in this case, stores all its product identifier information locally, with the database synchronized with a third-party routing service. When a wholesaler receives a saleable return, it captures the product data, sends it to the third-party router service, which, in its turn, routes the query to the manufacturer’s database.

“There is no ‘one-size-fits-all-situation’ to meeting this compliance deadline. Each company is different and will need to determine, based on their needs, which scenario or combination of scenarios work best for their company,” said Perry Fri, Executive VP of Industry Relations, Membership and Education, HDA; and COO of the HDA Research Foundation.

HDA also announced the results of its Manufacturer Serialization Readiness Survey, which surveyed 73 manufacturers that account for 71% of drugs produced in the U.S. The survey found that 89% of manufacturers were ready to ship serialized products before the DSCSA-set deadline in November 2017. 67.1% expressed commitment to aggregate, and 27.4% are waiting for the FDA guidance to decide whether to aggregate. The next big event is for the FDA to publish its DSCSA aggregation guidance.

I know this is a lot to take in. For any further questions, please feel free to contact one of our DSCSA experts for a free evaluation of your process and procedures. To Book a free evaluation visit the TrackTraceRx web site.

-Chris

About TrackTraceRx Suite

Other solutions on the market today are totally fragmented by only providing one piece of the puzzle. Pharmaceutical companies today are stuck subscribing to multiple services, accessing different companies for support and paying thousands of dollars to integrate different systems. The TrackTraceRx Suite is a game changer by combining the TrackTraceRx Traceability Solution, a ERP, and a Commerce Platform completely integrated out of the box. This eliminates having to deal with multiple support, feature services and integration costs.

Please watch our video at http://www.tracktracesuite.com

 

Will Donald Trump Repeal The DSCSA Law?

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As one of the strangest and most ferocious election cycles in the U.S. has come to an end, and Donald Trump was named President-elect,industry experts are unboxing their crystal balls to try and predict what the future holds for the fate of existing regulation red tapes and one of its parts, the Drug Supply Chain Security Act (DSCSA). Even though we have yet to see the new administration in action, there is some evidence we can analyze to answer the question that keeps the industry tense – will Donald Trump eliminate the DSCSA?

Enacted in 2013, DSCSA is considered a heavy burden by many companies in the pharma supply chain. So some might think that there is a possibility the new administration would scrutinize it since Trump promised to “cut the red tape at the FDA: there are over 4,000 drugs awaiting approval, and we especially want to speed the approval of life-saving medications.”

Again, just as a full repeal of the ACA is unlikely, we assume the same could be true for the DSCSA mainly because of the preemption clause. Eliminating the DSCSA in its entirety would also remove the preemption clause, which prevents states from passing more restrictive regulations than the ones in the DSCSA, such as the one in California. Elimination of the preemptive clause is very likely to cause much distress to the industry and be counter to Trump’s advocating of “cutting the red tape.” So, with the industry in opposition to the full DSCSA repeal, the Congress might not want to tread in those waters.

Let’s really think about this… A repeal of the DSCSA and removing a standardized federal law applied nationwide would allow States like Florida and California to once again enact their own laws. This takes us back to a fragmented track and trace disaster that the industry begged Congress to change in 2013, hence why the DSCSA was created.

So, if there is a change for the DSCSA on the table, it will most likely keep the preemption clause. Could some parts be eliminated? Some say yes, the ones that have not been applied by the companies in the supply chain by now – serialization and aggregation.

There is, of course, a chance for the DSCSA to fall under the category of the regulations that both parties “like” alongside coverage for patients with pre-existing conditions and plans that allow children to remain on their parents’ plans for extended time. We might assume, with the workload that the ACA repeal and replacement will be, the Congress might leave the smaller regulations like the DSCSA untouched.

In any case, the odds are in favor of President Trump signing the bills that would ease the regulatory pressure on businesses, but all direction points that with regards to the DSCSA, it will probably be an exception.

-Chris

About TrackTraceRx Suite

Other solutions on the market today are totally fragmented by only providing one piece of the puzzle. Pharmaceutical companies today are stuck subscribing to multiple services, accessing different companies for support and paying thousands of dollars to integrate different systems. The TrackTraceRx Suite is a game changer by combining the TrackTraceRx Traceability Solution, a ERP, and a Commerce Platform completely integrated out of the box. This eliminates having to deal with multiple support, feature services and integration costs.

Please watch our video at http://www.tracktracesuite.com

 

HDA Traceability Seminar Recap – FDA Update

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Hello Everyone,

The TrackTraceRx team spent last week at the HDA Traceability Seminar in Washington D.C. and found it very informative and beneficial. Thank you everyone who stopped by our booth and signed up to see our launch of the TrackTraceRx Suite. The demand has been amazing as companies see the benefits of having a fully integrated solution versus a single service solution.

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About the Conference

The HDA Traceability Seminar had a record breaking registered attendee of 450 (WOW!)… an amazing turnout. The HDA also covered their salable returns pilots and issued their report here:

http://www.hdmanet.org/~/media/pdfs/industry-relations/hda-pilots-scenario-brochure.ashx

The report covers different scenarios of handling how distributors must process serialized saleable pharmaceutical returns from customers.  According to an HDA member survey, saleable pharmaceutical returns comprise 2 to 3 percent — or nearly 59 million units — of total sales annually.

Out of the nine different scenarios in the report, two of the live pilot scenarios were determined to be the most cost-effective and viable approaches to achieving compliance. In the first recommended option, a manufacturer sends aggregated product identifier information only for the products purchased to each individual distributor; when the distributor processes a saleable return, the distributor references an internal database to verify the product identifier information from the manufacturer.

The second option employs a verification router service. In this scenario, the manufacturer stores all of its product identifier information locally, which is connected to a third-party routing service. Upon receiving a saleable return, the distributor captures the product data and sends the data to this third-party router service, which then routes the query to the appropriate manufacturer’s database.

FDA

Dr. Connie Jung from the FDA spoke about all respective DSCSA updates, and here is what we got:

The DSCSA text offers a grandfathering of current products clause for manufacturers and nothing for downstream trading partners. So the question remains on how downstream trading partners which receive products will handle grandfathering. It was implied that trading partners may possibly be able to take advantage of being able to grandfather these products also. TrackTraceRx will be able to confirm this as soon as the FDA releases more guidance on grandfathering products. When asked when this guidance would be issued all we got from the Dr. Connie Jung was “soon”.

Compounded drugs are exempt from the DSCSA.

The smallest saleable unit sold to the pharmacy must be serialized not the pill.

The FDA will not hold pilots but will look for the industry partner pilots.

Charitable organizations are not exempt from the DSCSA only company inter-transfer shipments are exempt.

All in all the event was amazing! Be sure that TrackTraceRx will be sponsoring the HDA’s next event as well at the: 2017 Distribution Management Conference and Expo (March 5-8). We hope to see you there!

-Chris

About TrackTraceRx Suite

Other solutions on the market today are totally fragmented by only providing one piece of the puzzle. Pharmaceutical companies today are stuck subscribing to multiple services, accessing different companies for support and paying thousands of dollars to integrate different systems. The TrackTraceRx Suite is a game changer by combining the TrackTraceRx Traceability Solution, a ERP, and a Commerce Platform completely integrated out of the box. This eliminates having to deal with multiple support, feature services and integration costs.

Please watch our video at http://www.tracktracesuite.com