Regulatory Focus™ > News Articles > Track and Trace, Compounding Legislation Passes Senate, Awaits President's Signature

Track and Trace, Compounding Legislation Passes Senate, Awaits President's Signature

Posted 18 November 2013 | By Alexander Gaffney, RAC

The Senate, after a series of long delays, has finally passed the Drug Quality and Security Act (DQSA), all but assuring the law's provisions to institute a national track and trace system and new compounding regulations will be signed into law later this month.


The DQSA was prompted by two issues.

The first and perhaps most serious problem has been the lack of a uniform "track and trace" system for pharmaceutical products. While California has moved to implement just such a system (which has in turn become something of a de facto standard for all US companies due to California's market share), legislators have been interested in implementing a national standard to avoid other states introducing competing ones.

The other hope, of course, is that the system will allow regulators to keep better track of the pharmaceutical supply chain, cutting down on counterfeiters and allowing them to respond more quickly to other problems as well.

The second problem, and the subject of numerous congressional hearings, has been the issue of drug compounding. Under federal law, pharmaceutical compounders are treated as separate entities from pharmaceutical manufacturers, and are allowed to operate under state-not federal-oversight. In late 2012, a massive outbreak of fungal meningitis caused by contaminated steroid injections caused legislators to re-evaluate that paradigm and seek out new regulatory options.


The DQSA contains extensive measures meant to solve both problems.

To the former, the bill would institute a national track and trace system which calls for all drug packages to carry a serial number within four years. In addition, the legislation would implement a lot-level tracking system four years after the law's passage, with a package-level tracing system (also known as unit-level) coming into effect 10 years after.

FDA would also be charged with issuing guidance on meeting trace and trace regulations within one year, and within two years would need to establish a waiver process by which companies could become exempt from the regulations. Most importantly of all, the federal system would also preempt California's track and trace measures, creating a single nation-wide standard.

To the latter (compounding), the legislation will create a voluntary registration system by which compounding facilities can sign up to be inspected by FDA. The hope of legislators is that facilities will have a greater incentive to purchase supplies from these facilities, and in turn incent companies to become registered with FDA in the first place.

The legislation also bans compounders from making "essentially a copy of a marketed and approved drug," and gives FDA new authority to inspect compounding facilities in accordance with a "risk-based schedule." Companies, in turn, will be required to report adverse events to FDA.

However, the bill's compounding provisions mostly leave intact the patchwork of regulations that critics have contended allowed deficient compounding practices to harm patients in the first place. Compounders who continue to operate within state lines will still be regulated by state boards of pharmacy-not FDA.

For at least some legislators, however, the bill closes the gap identified at the start of the 2012 meningitis outbreak.

"Though work remains to be done, the Drug Quality and Security Act will clarify who is responsible for overseeing facilities that produce sterile drugs," said Rep Morgan Griffith (R-VA), one of the authors of the bill's compounding provisions, in a statement. "This bill, if in effect prior to last year, would have prevented [the New England Compounding Center's] improper conduct from going undetected by the appropriate agencies."

The bill was approved on 18 November 2013 by voice vote, and now awaits President Barack Obama's signature before it becomes law.

Drug Quality and Security Act (DQSA)

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