RFID To Flourish In Pharmaceutical Industry

Use of radio-frequency identification by pharmaceutical companies will surpass that of consumer packaged-goods makers within 18 months, predicts a new Meta Group report to be issued Tuesday. But predictions that most pharmaceutical products will be tagged with electronic product code-compliant RFID tags at the pallet and case level within three years are "overly optimistic," the report says.

The "immaturity of EPC tag technology" is the limiting factor in the rate of RFID adoption, the report says. Current EPC specifications, for example, lack safeguards to prevent one chip's programming being copied onto another, a key requirement for guaranteed authentication. Such technology limitations, according to the report, reduce RFID's potential usefulness in the pharmaceutical industry to simple "track and trace" applications until EPC specifications are revised.

Other questions that need to be addressed include the need for the FDA to validate RFID systems and the unknown impact of radio-frequency energy on drugs.

Earlier this year, the federal Food and Drug Administration issued a report estimating that most pharmaceutical products would be shipped with EPC RFID tags at the pallet and case level within three years.

But the Meta report says RFID's potential return on investment for pharmaceutical companies is significant through improved inventory management and product-recall capability, enhanced patient safety, and as a guard against drug counterfeiting. Given those potential benefits, Meta predicts the use of RFID by drugmakers will surpass that of consumer packaged-goods companies within 18 months.