January 1, 2015 was the initial deadline for manufacturers, wholesale drug distributors, and repackagers to provide product information to their trading partners along the supply chain in compliance with the Drug Supply Chain Security Act (DSCSA). On December 31, 2014, the Food and Drug Administration (FDA) issued a Guidance document announcing that it will exercise its discretion not to enforce the product tracing requirement of the DSCSA until May 1, 2015. Trading partners now have four extra months to work out the details with parties up and down the supply chain.
The DSCSA was enacted on November 27, 2013, and seeks to protect consumers by improving detection and removal of potentially contaminated or fake products from the distribution supply chain. The Act outlines a ten year plan to build an electronic, interoperable system to both identify and trace prescription drugs through distribution across the United States.
A fundamental early step in the DSCSA is the tracing of certain pharmaceuticals through the distribution chain. Initially, starting on January 1, 2015 (now pushed to May 1st), manufacturers, repackagers, wholesale distributors (“trading partners”) are required to provide the subsequent purchaser with product tracing information each time the drug is sold in the U.S. market. This transaction document has three required pieces:
(1) Transaction Information:
- Proprietary or established name or names of the product;
- Strength and dosage form of the product;
- National Drug Code number of the product;
- Container size;
- Number of containers;
- Lot number of the product;
- Date of the transaction;
- Date of the shipment, if more than 24 hours after the date of the transaction; and
- Business name and address of the person from whom and to whom ownership is being transferred.
(2) Transaction History: A statement in paper or electronic form, including the transaction information for each prior transaction going back to the manufacturer of the product.
(3) Transaction Statement: A statement, in paper or electronic form, that the entity transferring ownership in a transaction—
- Is authorized as required under DSCSA;
- Received the product from a person that is authorized as required under DSCSA;
- Received transaction information and a transaction statement from the prior owner of the product, as required under the law;
- Did not knowingly ship a suspect or illegitimate product;
- Had systems and processes in place to comply with verification requirements under the law;
- Did not knowingly provide false transaction information; and
- Did not knowingly alter the transaction history.
Trading partners are also required to capture the product tracing information and maintain the applicable information for not less than 6 years after the date of the transaction.
FDA’s Latest Guidance
In FDA’s Guidance, DSCSA Implementation: Product Tracing Requirements— Compliance Policy, the Agency notes that some trading partners “expressed concern that unforeseen complications with the exchange of the required information may result in disruptions in the supply chain, and ultimately could impact patients’ access to needed prescription drugs.”
“FDA recognizes that some manufacturers, wholesale distributors, and repackagers may need additional time beyond January 1, 2015, to work with trading partners to ensure that all of the product tracing information…is provided to and captured by the recipient trading partner,” states the Guidance. “To minimize possible disruptions in the distribution of prescription drugs in the United States, FDA does not intend to take action against trading partners who do not, prior to May 1, 2015, provide or capture the product tracing information.”
Manufacturers’ Current Responsibilities
However, FDA specifies that the Guidance does not extend to other aspects of the DSCSA, including the following two requirements:
(1) By January 1, trading partners must ensure that they engage only in transactions with “authorized” trading partners, meaning parties with valid registration or state licensure. FDA recommends that manufacturers and repackagers check FDA’s drug establishment registration database for registration. For wholesale distributors, third-party logistic providers and dispensers, FDA advises checking the respective state authority to confirm licensure.
(2) Also by January 1, trading partners must have established systems for verification and handling “suspect” or “illegitimate products.”
Suspect products are products “for which there is reason to believe” the product is
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(A) is potentially counterfeit, diverted, or stolen;
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(B) is potentially intentionally adulterated such that the product would result in serious adverse health consequences or death to humans;
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(C) is potentially the subject of a fraudulent transaction; or
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(D) appears otherwise unfit for distribution such that the product would result in serious adverse health consequences or death to humans.
Illegitmate products are essentially suspect products that the trading partner has found “credible evidence” to support their initial suspicion. Trading partners must establish systems to quarantine and investigate suspect products to determine if they are illegitimate, and then notify FDA and immediate trading partners if they find that it is indeed an illegitimate product.
To assist manufacturers, repackagers, wholesale distributors, and dispensers to comply with the verification requirements, FDA published the draft guidance for industry, Drug Supply Chain Security Act Implementation: Identification of Suspect Product and Notification (June 2014). FDA also posted a webinar that reviews how to identify suspect product and the process for notification.
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We will be following FDA’s future guidances related to the DSCSA. In 2015, the Agency is expecting to release a long list of such documents, including:
- DSCSA Implementation: Annual Reporting by Prescription Drug Wholesale Distributors and Third Party Logistics Providers
- DSCSA Implementation: Products Eligible for Grandfather Status
- DSCSA Implementation: Standards for the Interoperable Exchange of Information for Tracing
- Certain Human, Finished Prescription Drugs – Standardization of Data and Documentation Practices
- DSCSA Implementation: The Product Identifier for Human, Finished, Prescription Drugs
- DSCSA: Verification Systems for Prescription Drugs
- DSCSA Implementation: Waivers, Exceptions and Exemptions from Product Tracing Requirements