E-Pedigree's Evolution

By Ronald Quirk

Yet another reason is that until recently, there has been no harmonized RFID standard. In years past, RFID vendors adopted various standards, which led, among other things, to equipment incompatibility, a lack of interoperability and high overall costs and inefficiencies.

Additionally, some states have implemented their own drug-pedigree laws with different compliance requirements—none of which requires RFID. California, Florida, Nevada and Virginia have each passed pedigree laws, for instance. Many drug companies are now avoiding the upfront costs of RFID by using less expensive alternatives, such as bar codes and paper, to comply with these laws.

In June 2006, in light of the drug companies' reluctance to implement e-pedigrees, the FDA released an updated drug counterfeiting report urging the industry to move quickly to implement RFID. The organization announced that effective January 2007, it would lift the stay on regulations related to the Prescription Drug Marketing Act of 1987 (PDMA) [see FDA Issues New Counterfeit Drug Task Force Report]. These regulations require smaller drug distributors to institute pedigrees (though not necessarily electronic), to track the chain of custody of prescription drugs moving through their distribution systems. Although the PDMA regulations do not mandate e-pedigrees, the FDA hoped lifting the stay would encourage drug companies to implement RFID, which is a much more efficient tracking technology than either bar codes or paper.

However, a federal court subsequently blocked the FDA's plan. In summer 2006, 10 pharmaceutical distributors filed suit against the FDA in the U.S. District Court for the Eastern District of New York, seeking to prevent the agency's lifting of the stay on the PDMA regulations. The plaintiffs claimed the FDA's pedigree rules were unconstitutional since they applied only to smaller distributors, not the three largest U.S. distributors, termed the "authorized distributors of record" (ADR).

The court agreed with the plaintiffs and, in late 2006, issued an injunction, effectively reinstating the stay on the pedigree rules [see U.S. Judge Issues Injunction Against Drug-Pedigree Rules]. Sources say the injunction is likely to stay in effect until the suit is ultimately resolved, which could take years.

Nonetheless, many legal experts expect the FDA's PDMA rules to be instituted eventually. Courts typically favor the government in cases such as this, that allege violations of the U.S. Constitution's "equal protection" and "due process" clauses when the rational basis test applies—i.e., the challenger must show that a law is not rationally related to a legitimate government interest. This is a high burden to place on a challenger, and the government often wins these kinds of cases.