Pharma Ponders a Track-and-Trace System

I very much enjoyed reading Mr. Roberti's article on the challenges facing pharma and biotech in complying with proposed track and trace legislation. I felt however, it is important to calibrate the challenges properly in order to fully grasp the opportunity and impediments to implementing RFID and the industry's apparent hesitance to do so. The mandate for traceability has been in place since the first recommendation by the Counterfeit Drug Task Force in 2004 and has been specified in terms of enforcement in Compliance Policy Guide 160.900 Prescription Drug Marketing Act – Pedigree Requirements under 21 CFR Part 203 December 2006. So the legislation exists. For an industry which spends literally billions on product development why hasn’t there been a rush to adopt RFID? The answer is complex but I believe lies in some fundamental truths. First there must be a tangible perceived threat to prompt the industry to jump to significantly more modern technology. For an industry that has just embraced barcoding to any significant level over the last 5 years, RFID is star wars technology. Technology adoption is always a labor intensive undertaking. In addition to this challenge we have the market and pricing challenge. The industry is not eschewing adopting track and trace because it wants to put people in harms way. The very real fact is the US pharma market is contracting. Consolidation and layoffs at all of the big pharma and biotech companies are occurring on a weekly basis as the industry attempts to look for new ways to become more efficient an drive down development costs in light of mounting pressure from the public and Congress to drive down the cost of health care. Couple this with an FDA that has stumbled badly over the last few years in terms of protecting the public and you have a highly risk averse environment for bringing in new therapies. So take the $1.3 billion it takes to develop a drug, add a couple of hundred million and several more years and you have a very challenging market and only a few years of patent protection in which to be profitable.

The drive to exploit low cost manufacturing overseas as a cost cutting measure is opening the industry up to risk. Assessing that risk as part of a structured risk management model is key to ensuring the security of our drug supply. The Heparin example would not have been alleviated by RFID because the root cause was a well known additive which looks the same on test as Heparin. The problem started with the acceptance criteria and testing not with the supply chain. So to set the record straight I believe RFID technology and new emerging versions of these technologies offer the portent of tremendous advantage to the industry. However, if you do not consider the realities in technology adoption along with the drivers within this market sector you will never get your message heard.