Ask The Expert

By Shahram Moradpour

Q: How can RFID help to solve pharmaceutical counterfeiting problems?

A: Create and implement an RFID-driven drug pedigree trackand-trace system.

Drug counterfeiting in the pharmaceutical supply chain is a major issue for manufacturers, distributors, and pharmacies alike.

More importantly, however, counterfeit drugs pose a serious and sometimes fatal health risk to the public. Counterfeit drugs can be made using lower standards, and thus have poor quality. They may indeed have no active ingredients at all. Some may even contain the wrong ingredients.

The World Health Organization estimates that annual earnings from the sale of counterfeit and substandard medicines approach roughly $32 billion globally.

Meanwhile, the FDA, in a document it published in February 2004 (“Combating Counterfeit Drugs”), reports that it recently has seen an increase in drug counterfeiting activities, as well as increased sophistication in the methods used to introduce counterfeits into the drug supply chain. Specifically, the FDA states the number of counterfeit drug investigations have increased to over 20 per year since 2000. The number stood at only an average of five per year during the late 1990s.

Outside the United States, counterfeit drugs are an even bigger problem. Some reports show that in certain countries, more than 50% of their drug supply may be counterfeit.

A drug pedigree track-and-trace system can help contain the pharmaceutical industry’s growing counterfeiting problem.

Specifically, a pedigree system addresses the problem by enabling a better means of tracing and identifying the source of counterfeiting– through what can often be a complex supply and distribution chain–when a drug is identified to be fake, impure, or substandard.

Electronic drug pedigree, or ePedigree, is essentially an automated pedigree system that electronically records, authenticates, and manages a drug’s entire chain of custody as it goes from the manufacturer to a series of wholesalers, distributors, and re-packagers, before it finds its way into a hospital, on the Internet, at the street corner pharmacy, or at one of several large pharmacy chain stores. While pedigree tracking is not yet a legal requirement across the U.S., both California and Florida have created new laws requiring pedigree tracking for drugs distributed in those states. Nevada is expected to follow suit shortly.

In simple terms, the process requires that each entity in the supply chain record, and often certify, data about the drugs it receives and/or redistributes. The data includes information such as drug lot numbers and quantities, along with specific shipping, receiving, and handling information.

As a pallet, case, or package of medicine moves through the supply chain and distribution channels, the drug’s pedigree information keeps growing. If at any point a counterfeit lot is found or a suspicious pedigree record is identified, then it is possible for the drug manufacturer, or more likely, a state or federal entity (such as the FDA) to trace through the entire chain of custody for that drug, and pinpoint the location at which the counterfeits may have been introduced.

Note that the pedigree laws in existence today do not necessarily require an electronic or an automated record-keeping and management process. However, as the laws expand to include more states and more drugs, it will be highly inefficient to use manual, paper-based systems. Furthermore, a paper-based system itself is more susceptible to error and fraud. An electronic system, on the other hand, provides a much more reliable means of recording, authenticating (using digital signatures), and managing data at every step in the process.

Strictly speaking, RFID is not required to implement a drug pedigree solution, electronic or otherwise.

However, RFID plays a critical role in making a solution more cost effective, and easier to implement and manage. For starters, RFID tags can uniquely identify each drug down to the single- item level.

Next, because RFID requires no line of sight or manual handling, the added requirement to track items in the entire supply chain will add minimal overhead when compared to a manual (or even a barcode) system of tracking and recording.

Last but not least, the EPCglobal organization, which is dedicated to help drive broadbased adoption of RFID-enabled supply chain operations, will serve as a focal point to help iron out the many issues and concerns that may be associated with efficient, secure, and authorized sharing of data among suppliers, distributors, customers, and competitors alike. In short, RFID offers the means to create mass serialization (unique identification) for all drugs, a requirement for ePedigree to work properly, in a cost-effective, efficient, and expeditious manner.

The pharmaceutical industry is indeed coming together to help solve the drug counterfeiting problem using ePedigree.

In addition to the FDA guidelines, and the California and Florida laws, pharmaceutical manufacturers including GlaxoSmithKline, Pfizer, and Purdue Pharma have announced that they are conducting pilots, and plan to apply RFID tags to at least one product as early as this year.

Separately, the FDA recently applauded Johnson and Johnson’s continuing efforts to collaborate with industry partners to develop standards for ePedigree.

Keep in mind that an ePedigree track-andtrace system does not necessarily “identify” a bottle of counterfeit medicine per se. ePedigree offers the ability to:

• help trace and identify the location where counterfeits may have been introduced, after they are found;
• help monitor activities at counterfeiting “hot spots” (such as re-packagers or secondary wholesalers) in the distribution channels; and
• curtail would-be counterfeiters’ ambitions.

In the end, no system is fail-safe, and one solution does not fit all situations. Besides, you can almost always find an entity that has the means and the resources to cheat or defeat any given system. For this reason, the FDA, in its “Combating Counterfeit Drugs” report, recommends implementing a comprehensive series of safeguards, in addition to ePedigree, to contain the overall threat of counterfeiting more effectively.

Shahram Moradpour is chief executive of Cleritec Systems Corporation, San Jose, Calif. Cleritec provides RFID solutions for manufacturing, retail, and healthcare companies as well as logistics providers to improve the efficiency and accuracy of their operations. Moradpour also is co-author of “RFID Field Guide: Deploying Radio Frequency Identification Systems” (see Business Reply Card in this issue, or visit www.rfidfieldguide.com and mention RFID Product News).