It’s been over three months since President Obama signed the Drug Quality and Security Act (DQSA) into law, and some of the industry is still unsure how to proceed with preparation for Title II, which outlines the plan for supply chain security. The first requirement stemming from the DQSA goes into effect on January 1st 2015. Under this section of the law, manufacturers, wholesalers, and re-packagers must be able to capture and provide the next owner in the supply chain an electronic or paper transaction history, information, and statement. From there, requirements will continue to roll out, and it’s imperative to know which ones affect your company.
In a recent discussion with Pharmaceutical Online, Ilisa Bernstein, Pharm.D, JD, Deputy Director of the U.S. FDA Office of Compliance in the Center for Drug Evaluation and Research (CDER), encouraged the industry to familiarize itself with the law and the requirements under it. “If you are a manufacturer, wholesaler, or packager, know what you need to do and by when it is stated in the law,” says Bernstein. “There are some things FDA will be providing guidance on as additional regulations under the law, but in the meantime, the stakeholders need to know what is coming and what they need to do.”
Know Your As Is And To Be
With so much of the past focus on the 2017 deadline of the California e-Pedigree Law, Greg Cathcart, CEO of Excellis Health Solutions, a consulting firm for the life sciences industry, is concerned many companies are viewing the November 2023 final deadline of the DQSA as a reprieve, when it certainly is not. “Those US companies who think they got a break because they don’t have to serialize their product for a little bit longer and haven’t done anything need to get off the couch,” he says. “In order to be ready for the January 2015 deadline, the first they need to do—and quickly— is evaluate what they have today and what they need.” He adds that preparations for the January 2015 requirement will take at least 6 months.
To prepare, Cathcart says Excellis looks for a company’s “as is” and “to be.” He explains, “The ‘as is’ refers to your current processes. What’s your business process today for manufacturing your product and selling and shipping your product? Those are the two areas affected by this issue. Then, based on what we know about the current business, or ‘as is’, we develop a ‘to be.’” The “to be” includes what technologies they have or don’t have and which ones they would have to upgrade and/or buy. “They have might have some technologies that would work, but if they don’t, they might have to go buy something. How long and how much would that take?” he explains.
Mark Shaffer, pharmaceutical business development manager at Domino North America, a manufacturer of coding and printing technology, also encourages swift action. In November 2017, manufacturers face the next requirement, which relates to product identifiers and packaging changes. “What people don’t recognize is that this is not just about an infrastructure, but there are really tangible changes you have to make to your package design to accommodate a serialized code,” explains Shaffer. “This can be a two- to three-year process. If you haven’t started today, then 2017 is not that far away. Starting now gives companies an opportunity to be compliant and to be able to apply a logical strategy, rather than do it from a shotgun approach.”
Figure Out Funding
No matter what size company you are, Cathcart says knowing how you’re going to fund any changes is a critical part of the planning process. Money received on an annualized basis that used to go to preventative maintenance-type spending now has to be shared with serialization efforts. Therefore, unless a company has an extra budget set aside (which is often unlikely), they’ll need to analyze how their current budget is being spent and where cuts can take place without risking compliance in other areas.
In addition, funding for resources, such as a consultant or even additional in-house experts may be required. “They need to look at their coding, they need to look at their software, and they need to look at their infrastructure,” says Shaffer about the November 2017 requirement. “From a human resource perspective, they need to determine if they have the skill sets to be able to do this, and if not, they need to start to look at that.”
As Shaffer explains, the future of a company is undoubtedly on the line. “Those who have implemented a solution are going to get the lion’s share of the business, but those who haven’t, it’s not like they are going to get other business,” he says. “They can literally find themselves not a player anymore.”
Engage Top Leadership
Cathcart says one major reason some companies are struggling to receive the funding necessary is because they’re still trying to obtain buy-in from the executive leadership team. If the people at the top do not understand the ultimate goal and continue to ask why so much effort is going into something that seems so far down the road, this slows down the process and makes the cost of the project go even higher. That is why Cathcart also believes education for the high executives of a company is critical for success.
He points to an Excellis customer whose CEO possesses the type of forward thinking necessary for someone in an executive leadership role. “They have made it clear that because of their preparation for this mandate, they can guarantee their product is safe and secure and can prove it to their buying customers,” he explains. “They expect to see a return in their investment because their product is meeting requirements and their competitors are not.”
Make Sure Your Partners Are Aligned
With BRIC (Brazil, Russia, India, and China) countries driving serialization requirements that go into effect as early as this year (India), manufacturers who want to continue or begin business globally have already started to consider how their business aligns with those partners. However, companies should also consider their relationship with domestic partners. Cathcart is particularly concerned with small-to medium-sized contract packaging organizations. “These companies have done very little, if anything, to prepare,” he says. “The manufacturing community has not really worked with the contract packaging groups to help them figure out a funding model.”
He offers an example of a pharmaceutical company that he says is a billion dollar company with about 400-500 different products and about 8-10 internal packaging lines; however, they have contract packagers that produce products on as much as 30-40 different lines, which could be up to 60 percent of their product. “They not only have to look at what they need to do and by when, but they have to look at their partners,” explains Cathcart. “If those partners aren’t going to be ready by a certain date, they better start looking for new partners.”
Shaffer suggests contract packagers take advantage of the work that’s been done by their customers so they are aligned with their thinking. “Their customers have put in a lot of time and investment into these things and I think they should reach out to them. I certainly would think they’d be happy to share their wisdom and knowledge, and frankly, their mistakes too.”
Guidance From The FDA
There’s no question the DQSA has caused some unrest in the industry, particularly for anybody who was skeptical about its passing in the first place. The California mandate has dominated the serialization conversation for so many years, but without federal backing, many in the industry pushed it to the back burner. According to Cathcart, this is because only 23 percent of wholesalers and retailers do business in California. In other words, two-thirds of the industry wasn’t even going to be affected by the California e-Pedigree law. This has changed dramatically, and anybody who hadn’t taken action up to this point is now scrambling to ensure compliance starting in January 2015.
But even with a lengthy document outlining the FDA’s 10-year plan, there’s still a lot of unanswered questions about how the industry should prepare for next January. Should transaction history, information, and statements be provided in paper form or does the FDA expect it to be electronic? Bernstein says the FDA is aware the guidance lacks specificity around that requirement and they are working on providing answers sooner than later. “We are sensitive to the fact that there is a short period of time from when that guideline is required under the act and when they have to have the systems and processes in place,” she explains. “Given that sensitivity, we are working and our target is to give them as much lead time as possible.”
Bernstein adds that the most accurate information on the FDA’s interpretation of the law, as well as the details on how it will be rolled out, will be published on the FDA’s site (once these decisions are made). This is the best source for the industry to rely on, rather than any interpretations made by outside experts. Bernstein explains they are gathering feedback from various stakeholders, in order to determine next steps, including other countries. “We have been working for many years with foreign counterparts to see where they are, what they are doing, and keeping this in mind,” she says. “When we developed the standardized numerical identifier (SNI), we sought input from our foreign counterparts as well. “ One of those partners, as cited by Bernstein, is Turkey, who recently charged two Turkish nationals with smuggling counterfeit cancer treatment prescription drugs from Turkey and other countries into the United States. An effort most likely made possible because of Turkey’s serialization legislation, which went into effect in 2009 (first country to do so).
Although there are many details that still need to be determined, and more importantly communicated, the days of hoping for a delay are over. And with the FDA now running the show, compliance is more important than ever. “The end game is so important, and that’s why the federal government took this bill and really pushed it through,” says Cathcart. “The fact that it’s a federal bill and the FDA are the enforcers, everybody’s blood pressure and need to comply just went to 100 percent. You can’t cheat the FDA.”