Pandemic has challenged industry’s implementation of DSCSA

The pharmaceutical industry and its trading partners are showing “uneven readiness” in implementing the serialization systems necessary to comply with the Drug Supply Chain Security Act (DSCSA) by the November 2023 deadline when these exchanges go live.

The pandemic may have prompted this rocky situation as trading partners focus efforts on “core response activities” and not DSCSA compliance, according to a recent survey released 1 November by the Healthcare Distribution Alliance (HDA) Research Foundation.

The survey was launched in May 2021, and 40 manufacturers and 24 distributors responded.

“There continues to be uneven readiness that has likely been exacerbated by the difficulties of conducting business during the pandemic and the prioritization of COVID-19 response,” said HDA. “There are early adopters, those who appear to have delayed plans to implement ahead of schedule, and those continuing to prepare for implementation as laid out in the law.”

HDA further noted that US Food and Drug Administration’s (FDA’s) decision to grant enforcement discretion in 2023 for certain wholesale distributors and dispenser requirements “has resulted in a perception among some trading partners that they can ‘take their foot off the gas’ and defer necessary 2023 investments.” (RELATED: FDA delays enforcement of some DSCSA provisions by three years, Regulatory Focus 26 October 2020).

Forty percent of manufacturers are currently sending, or plan to send, some serialized data by the end of 2021 to their wholesale distributors and 43% plan to send this data by November 2023. Yet 16% are unsure when they plan to exchange such data.

The survey shows distributors are “still preparing for data exchange.” While 60% of distributors are prepared to accept serialized data, 40% are not. Of those that can receive such data, approximately 48% are receiving serialized data for only between 1% to 5% of their transactions.

The pace of aggregation has slowed, with fewer manufacturers planning to aggregate stock keeping units (SKUs) by the end of this year than in previous years. Forty percent of manufacturers responding to this year’s survey plan to send aggregated serialized data to wholesalers by 2023. This is a decline from previous years; more than 50% of manufacturers had previously reported that they were planning to aggregate by the end of 2019 and 2020. Aggregation means that the unique identifiers attached to each product are uniquely serialized to higher packaging levels and is a prerequisite for manufacturers to send serialized transaction data.

According to distributors, there is also “inconsistent” dispenser knowledge of DSCSA requirements.

Respondents identified the key challenges impacting manufacturers’ ability to comply with the 2023 deadline. Governance of the interoperable system for 2023 was cited by 56% of respondents; establishing standards was cited by 39%; and collaborating with trading partners and differing interpretations wereeach cited by 36%.

Survey contains both “good” and “bad” news

Commenting on the survey’s results, Perry Fri, executive vice president of industry relations and chief operating officer of the HDA Research Foundation, said the survey contains both bad and good news. Fri spoke at HDA’s 1 November Traceability Seminar.

“We are concerned with the state of industry readiness across all sectors. The data show that is a most concerning trend,” said Fri. “Aggregations have slowed, impacting plans for manufacturers to send data to send all SKUs by the end of this year.”

“The good news is that there is alignment between manufacturers and distributors to share EPCIS [Electronic Product Code Information Services] data when they are ready.”

Most manufacturers, 88%, are using EPCIS version 1.2; just 6% are still using EPCIS version 1.1.

DSCSA is silent on which type of data system to use for tracking products, and most stakeholders are aligning around EPCIS, which is a GS-1 standard for their data exchange. GS-1 is a neutral, non-profit global organization that develops and maintains global supply chain standards.

Most manufacturers will use VRS

In other areas, two-thirds of manufacturers expect to use the verification router service (VRS) to support verification requests for saleable returns. The law requires wholesalers to verify saleable returns they intend to further distribute, although the law is silent on which technology to use.

Fifty-six percent of distributors say they do not have concerns with meeting the deadline for verification requests while 44% have concerns. The key concerns cited are “challenges with VRS,” as well as concerns about “accuracy and completeness of data exchange.”

The survey was sponsored by LSPediA, a solution provider and Movilitas, a global consulting firm. It complements a September survey on the status of manufacturers and distributors exchanging EPCIS data. (RELATED: Pharmaceutical trading partners lagging in exchanging electronic product information, Regulatory Focus, 24 September 2021)

Serialization survey

Pandemic has challenged industry’s implementation of DSCSA

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