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6/16/2006
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FDA Scolds Drug Industry For Anemic RFID Adoption

The agency had high hopes that RFID would be on its way to broad adoption by now. Instead, state lawmakers and the FDA are having to turn up the pressure.

Just two years ago, adoption of radio-frequency identification technology by the pharmaceutical industry looked like it was on a fast track. Manufacturers such as Pfizer and Purdue Pharma started RFID pilot projects, and the Food and Drug Administration in a report predicted widespread use of electronic track-and-trace technology--including RFID--for securing drug supply chains throughout the industry by 2007.

They're real--but too many are fakes

They're real--but too many are fakes

Photo by Zuma Press
Yet pharma's use of RFID today remains limited to a handful of test projects. An FDA report this month, while calling those efforts encouraging, chastises drugmakers, wholesalers, and retailers for being slow to implement "e-pedigree" systems such as bar codes or RFID to prevent drug counterfeiting. The report singled out RFID adoption in particular: "We are disappointed with the lack of overall progress across the drug supply chain."

Time for the pharmaceutical industry to pick up the pace, amid a growing number of FDA and state government mandates for drug pedigree systems. A Florida law that takes effect July 1 requires such systems for pharmaceuticals shipped within the state, though it doesn't mandate the use of RFID or bar codes. California will require prescription drugs distributed within the state to be accompanied by an electronic pedigree starting Jan. 1. McKesson, one of the industry's three major distributors, said last week it has hired business-to-business software vendor Cyclone Commerce to implement an electronic document/digital signature system to comply with Florida's drug pedigree law.

The FDA for years has delayed requiring that drugmakers, distributors, and retailers implement pedigree systems as called for in the Prescription Drug Marketing Act of 1987. Now the agency is lifting its stay of that regulation and will require secondary drug wholesalers--those that don't buy directly from drug manufacturers--to implement a paper-based drug pedigree system starting Dec. 1. The FDA initially will focus its enforcement efforts on frequently copied or stolen drugs such as Lipitor, Viagra, and OxyContin. Requiring those drug pedigrees will provide "a kick in the pants to jump-start the entire system," said Randall Lutter, associate FDA commissioner for policy and planning and a co-author of the report, during a June 9 teleconference.

It's clear what technology the FDA is backing. "We continue to believe that RFID is the most promising technology for electronic track and trace across the drug supply chain and that stakeholders should move quickly to implement this technology," the agency's report says.

What's The Holdup?
RFID in the industry has been slowed by problems such as poor reliability and accuracy of RFID systems, a lack of data format standards, and confusion over whether HF or UHF tags will be used. Questions persist about RFID data ownership, access, and sharing. "And cost is still a factor," says Peggy Staver, Pfizer's trade product integration director, noting that the drugmaker's pilot project to tag every bottle of Viagra shipped in the United States has cost $5 million so far. (For more on the drug industry's use of RFID, see story,"Nonretail Businesses Take Lead With Item-Level RFID".)

Pfizer has been shipping pallets, cases, and bottles of Viagra with RFID chips since December to two distributors, and one retail pharmacy is using the system to authenticate bottles of the drug. While the project has worked well so far, Staver says the six months of collected data isn't enough to judge how ready the technology is for wide deployment. "It's kind of early to make any conclusions because of the slow uptake by our customers," she says.

Unlike in 2004, the FDA in its latest report isn't predicting how soon RFID will be widely adopted. It concedes that in the short term, hybrid pedigree systems incorporating paper and technology--either RFID or bar codes--might be necessary.

Staver questions how ready the pharmaceutical industry is to meet pedigree regulations, especially the looming California law. "I personally don't believe the industry is ready," she says. "There's a lot that needs to be done yet."

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