California gives industry a two-year reprieve on ePedigree

All of the major players in the distribution chain insist they support the principle of an ePedigree system in California.

Equally, though, they have all insisted the previous effective date of 1 January 2009 for the pedigree requirements was simply not practical, given the still unanswered questions around track-and-trace technology, the lack of standardisation in the field, and the costs and challenges of implementation.

These arguments prevailed at the pharmacy board's meeting on 25 March.

The deadline for implementation has now moved back to 1 January 2011, marking the second time the effective date for the ePedigree programme in California has been extended.

The pending legislation did include the authority to delay compliance until January 2011 if the state board determined that " manufacturers or wholesalers require additional time to implement electronic technologies to track the distribution of dangerous drugs within the state ".

The pharmacy board said it had reluctantly agreed to postpone the deadline as most large pharmaceutical manufacturers, distributors and retailers were not in a position to meet the ePedigree requirements by 1 January 2009.

According to a report in the New York Times, Pfizer - which has actually been something of a pioneer in adopting radiofrequency identification (RFID) technology (albeit selectively), due to the targeting of its erectile dysfunction treatment Viagra (sildenafil citrate) by counterfeiters - had told the board it would take five to seven years to put serial numbers on all of its products.

Without the extra two years' grace, there was a risk that " the California drug supply and potentially the entire US drug supply may very well be negatively impacted " by shortages of life-saving medicines, the pharmacy board warned.

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The board concludes that its primary duty to protect the public is better served by a delay permitting a less disruptive implementation than by a rush to secure industry compliance ," it stated.

The board also said it had received " concrete assurances " from representatives of the drug industry that " they can and will be ready for full implementation" by 1 January 2011.

The response to last Tuesday's decision from Pharmaceutical Research and Manufacturers of America (PhRMA) was somewhat less reassuring.

The vote to delay implementation was " an acknowledgment of the complex regulatory and technological challenges that still must be overcome ", PhRMA commented. "

And it is possible that even by 2011, some of the key challenges will remain and still need to be resolved ."

Most importantly, the association added, the decision " demonstrates board recognition of the importance of protecting patients throughout the state during the transition to new e-pedigree requirements ".

Pharmaceutical manufacturers have complained about the costs and effort involved in introducing changes to packaging lines that would effectively have to apply nationwide, as the manufacturers would not know which of their products were likely to make their way through the distribution system into California.

Consequently, they would prefer a uniform national system rather than potential state-to-state variations.

Some companies would like to see the ePedigree requirements in California phased in, starting with the products most vulnerable to counterfeiting.

The state legislation does not specifically include this kind of leeway, although the pharmacy board has indicated its willingness to talk about " grandfathering " of the requirements for drugs that are in the system without electronic pedigrees before the effective date for compliance.

The board also acknowledges that " there may be some initial period of adjustment immediately after the effective date of the pedigree law ", adding that it has " traditionally been flexible with regard to its enforcement discretion when new substantive laws come into effect ".

The pharmacy board " cannot waive or diminish the requirements of the law, but may be judicious in its enforcement thereof ," it comments. "

The board is also aware that to a substantial degree downstream participants in the drug distribution system are reliant on their upstream partners to supply them with the necessary pedigree information and serialised product(s); the board may therefore "roll out" its enforcement of the law accordingly ."

Pharmacists and wholesalers have argued that they cannot install the necessary software and equipment for reading serial numbers until they know what systems the manufacturers plan to use for tracking their products.

California was seen as the bellweather for efforts by other US states, such as Florida, to bolster defences against counterfeit and adulterated drugs.

The Californian legislation requires all prescription drugs sold in the state to have a unique, serial identifier that can be read electronically and is fully interoperable with the whole of the supply chain.

Traceability must extend from a drug's origin at the manufacturer all the way down to the pharmacy, with updating of the record or pedigree whenever there is a change of ownership.

The Healthcare Distribution Management Association (HDMA) described the Californian pedigree requirements as " unprecedented ".

The state's " first-of-its-kind law requires that each prescription medicine be uniquely identified and electronically tracked by all segments of the healthcare supply chain, including manufacturers, distributors and pharmacies or healthcare providers ," the association pointed out.

Information that must be tracked includes the name of the prescription medicine, the dosage, the container size, the number of containers, the product lot or control number, the names and addresses of each company that bought and sold the medicine, the dates of all previous sales and shipping information, the HDMA noted, adding: " Neither Federal law nor that of any other state requires tracking of prescription medicine at this unique level ".

The ePedigree system was originally mooted in 2004 as part of more wide-ranging legislation (SB 1307) to protect the drug distribution system against counterfeits.

In 2006 the California State Board of Pharmacy sponsored further legislation (SB 1476) that strengthened and clarified some of the pedigree requirements while shifting their implementation date from 1 January 2007 to 1 January 2009.

Responding to last week's vote, PhRMA senior vice-president Ken Johnson said the two-year breathing space to January 2011 would give a number of players in the distribution chain more time to get their houses in order.

For example, he said, manufacturers of blood products would have an extra two years to test the effect of RFID technology on these treatments.

They would also have " more time to encourage the Food and Drug Administration to provide guidance on how companies should test to determine whether heat generated by the RFID system affects either the safety or effectiveness of blood products" .

Researchers, for their part, would be able to address more comfortably the " technology compatibility problem that confronts those trying to implement the law ", Johnson added. "

The fact is, the technology exists to track medicines, but we do not have one standard electronic serialisation system everyone can use to monitor medications throughout the pharmaceutical supply chain ".

Another problem was that some companies with a wide range of medicines were " concerned that there's a limited number of technical experts to reconfigure product packaging and labelling lines.

Changing the labels and obtaining FDA approval of the new lines could not have been done in time to meet the old deadline ."

The extended deadline would also help state and local government agencies in California that were facing " budget crises " over the ePedigree requirements, Johnson claimed. "

Organisations like the California Department of Corrections, state mental hospitals, California State University campus clinics and University of California hospitals must purchase many different expensive technologies to be in compliance with the law," he said.

"And accomplishing that goal by January 1 would have been a daunting task ."

Sticking to a rigid implementation deadline " would have undoubtedly disrupted the entire pharmaceutical distribution chain" , Johnson contended. "

Millions of Californians could have been denied critically important medicines and quality of care throughout the state could have been dangerously compromised ."

The HDMA stressed that ePedigree provisions were " just one part of a comprehensive anti-counterfeiting strategy that must involve manufacturers, distributors and pharmacies ".

To that end, HDMA and the primary healthcare distributors in the US " strongly support stricter licensing standards; tougher regulation, stronger law enforcement and harsher criminal penalties for the crime of counterfeiting medicine; current and emerging track-and-trace technologies; and the development of new research and innovation in the supply chain ."

The decision to delay implementation comes as widening concern about contaminated heparin sourced from China, which has been linked to hundreds of severe adverse events and 19 deaths in the US, has focused attention on the vulnerability of the supply chain -particularly in the light of increased globalisation, internet commerce and outsourcing of production in the pharmaceutical market.

The pharmacy board's vote will also disappoint suppliers of RFID and other track-and-trace technologies, such as Catalent/Secure Symbology, IBM/Tagys, Nosco, Systech and SupplyScape, that have been gearing up for the January 2009 deadline with systems compatible with California's ePedigree legislation