“Who's responsible for the safety of the pharmaceutical supply chain in the U.S.?” Ask that and enjoy the breeze from the wave of finger pointing. This is especially the case with electronic pedigree rules.

A pedigree is a statement representing the chain of ownership, and the Food and Drug Administration (FDA) regulations require drugs shipped by a wholesale distributor to include it as a record of each transaction in the supply chain.

The FDA says technologies like RFID and 2D bar codes are key to the kind of mass serialization necessary to fight drug counterfeiting. However, enough objections from several industry forces have delayed a federal law. That hasn't stopped states from taking action. According to industry sources, 17 states have adopted pedigree requirements, and an additional 21 are considering it. California is furthest ahead, requiring pedigrees in electronic form by Jan. 1, 2009.

All this finger pointing about who goes first is a waste of precious time, according to Todd Applebaum, vice president of strategy and operations consulting at Maxiom Consulting Group, a Massachusetts-based firm that works with pharmaceutical manufacturers. He believes supply chain security starts at the source.

“You can't secure the supply chain starting in the middle,” he says. When it comes to counterfeiting and diversion, whether it happens in the wholesaler chain or in the tail end at hospitals or clinics or drug stores, the net effect falls back on the manufacturer. Their brand is in jeopardy.”

Supply chain partners fall into three camps when it comes to adopting the necessary technology to pedigree products:

1. Those who feel confident regulation deadlines will be delayed and they can play wait and see.
2. Those who do enough to show good intent. They'll prepare themselves in case they need to do something.
3. Those who take action because even if enforcement is postponed, this is something that is needed and will happen at some level. They not only want to protect their brand, but they want to use this issue to competitive advantage.

Potential benefits for technology adopters include collecting consumer information and being able to prevent diversion, remarketing and return and warranty fraud.

Is technology ready to deliver?

“The truth is, RFID is not ready to be used at a unit level for mass serialization of pharmaceuticals,” Applebaum says. “Some companies are looking at the more conventional tracking technologies like 2D bar coding. You can create a complete track and trace system this way. The companies we see moving forward are going in that direction. In most cases they're starting with what can be gleaned from pedigree standards developed either by their state or by EPC Global. Whether the vehicle turns out to be some form of bar code or radio frequency, the lessons learned in pharma will be applicable elsewhere.”

Major wholesalers are trying various technologies in their own facilities.

“We have a track and trace pilot designed to test RFID readability and electronic pedigree data exchange in California,” says Heather Zenk, director of integrated solutions for AmerisourceBergen. “Based on our test results we believe RFID will help maintain or improve the efficiency built into the current supply chain. However, if we are required to scan a line of site bar code (e.g. 2D bar code) on each product, that will impact efficiencies.”

One of ABC's competitors agreed saying, “The challenge with an optical solution when you're dealing with hundreds of thousands of transactions a night is that it could impact the throughput of our business.”

Technology suppliers are modifying their product lines to meet the pharmaceutical industry's requirements. Pedigree software is already on the market. Ilisa B.G. Bernstein, director of Pharmacy Affairs at the FDA, says this is useful even for companies that don't apply unique serialization to each package. However, she suggests companies pay attention to what's happening at the state and federal levels so they can make best use of the technologies they adopt. Things are happening more quickly as supply chain safety and security get White House attention.

“The president just signed legislation that requires the FDA to develop standards for tracking and tracing and authentication of products and for serialization,” she says. “It calls for serialization within 30 months. Hopefully it will jumpstart the supply chain so there will be uniform standards.