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Senate Releases Draft Proposal of National Track and Trace System

Posted 25 October 2012 | By

The Senate has released a draft proposal to develop a so-called "track and trace" provision legislators say will increase the security of the US' pharmaceutical supply chain.

The system, so named because it would allow regulators to track the movement of a product throughout the supply chain and trace the path of any product found later, is intended to reduce the supply chain's susceptibility to the introduction of counterfeit products without detection.

The provisions were originally supposed to be a part of the Food and Drug Administration Safety and Innovation Act (FDASIA), but were dropped from the legislation just weeks before passage after staffers could not find agreement over whether products should be tracked at the individual product level or at the lot level.

Also at issue: whether the pharmaceutical industry would be responsible for funding the project in whole or in part, and the speed at which information would be made available. Industry favored a system in which government paid at least some of the costs for the system, which would involve a periodically-updated serialization system, while the US Food and Drug Administration (FDA) favored a real-time system paid for by industry.

After FDASIA's passage in early July 2012, legislators and their staff re-started negotiations, and by August 2012 news organizations were reporting progress between members of the House Energy and Commerce Committee and the Senate Health, Education, Labor and Pensions (HELP) Committee. The two committees are, respectively, responsible for overseeing both the pharmaceutical industry and FDA.

Draft Calls for Interoperable Standards to be Developed by Regulators

The 115-page HELP Committee draft describes a system in which the US Department of Health and Human Services-most likely FDA-will be charged with, "Developing standards for the interoperable exchange of transaction information for tracking and tracing prescription drugs."

The strategy will likely side-step much of the congressional controversy that has bogged down the legislation for years, passing responsibility to health officials and regulators to grapple with. Public safety advocates hoping for a rapid turnaround time may find themselves disappointed at the timeframe for the proposed regulations, however. DHHS will have up to two years to develop the regulations for such a system once the legislation is passed.

Regulators will also be charged with generating waivers for participants in the supply chain system. As it stands most manufacturers, repackagers, wholesale distributors and dispensers will be required to participate. Waivers will be granted on the basis of hardship or for, "emergency medical reasons," wrote legislators. Certain products might also find themselves grandfathered under the legislation's provisions, though exemptions will be the purview of DHHS, and are not enumerated in the legislation.

All requirements would end all state- and local-level track and trace or pedigree requirements, replacing them with a single, uniform system applicable throughout the US, legislators said.

Detail Emerges for Penalties, Authenticity Requirements

Some parts of the system are, however, sketched out in relative detail. Penalties will be assessed for any entity within the supply chain that accepts ownership of a product without being presented with its transaction history, transaction information and a transaction statement for the product.

These would eventually describe the entire route from a recognized manufacturer to an end customer. Manufacturers would be required to put into place systems within 18 months of the legislation's passage allowing them to respond to verification requests regarding the authenticity of a pharmaceutical product. Responses would be required to take place within 24 hours.

Manufacturers may also satisfy this requirement by setting up a secure electronic database accessible by trusted members of the pharmaceutical supply chain. Products deemed to be suspect should be segregated and investigated to determine its point of entry into the supply chain, and DHHS and other trading partners should be notified within 24 hours.

Renewed Focus on Wholesalers

Similar provisions are in place for wholesalers, repackagers, and dispensers as well, though different timelines exist for each separate entity. The legislation also stipulates the creation of pilot projects to increase coordination between these entities in the hope of better utilizing product identifier data and improving the technical capacity of the subsectors to, "Comply with interoperable, electronic, unit-level package tracing system[s]."

All manufacturers, wholesalers, repackagers, and dispensing facilities would also be required to register with DHHS.

DHHS-again, likely FDA-would be also be charged with developing good distribution regulations and guidelines for the storage, handling, security, record-keeping, quality management and transport of drug products.

Regulators would also have the option of either creating licensing standards for wholesalers to be administered at the state level, or to create a new national wholesaler licensing system to be overseen by DHHS. A third option would allow DHHS to set a regulated floor for licenses granted by states, but would allow the states to exceed such licensing requirements.

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