The pharmaceutical industry's long-term goal in counterfeit prevention should be to have all drug products contain an "electronic pedigree," FDA's Counterfeit Drug Task Force interim report says.

"Appropriate long-term goals for the use of technology include achieving an electronic pedigree and incorporation of authentication measures for all drug products," the Oct. 2 ¹ interim report states.

One way FDA envisions an "electronic pedigree" system being implemented is through use of radio-frequency identification (RFID), which is still in pilot testing. RFID chips are a type of "track and trace" technology that allows a product to be followed through each point in the distribution chain.

"If all entities in the drug distribution chain use RFID chips or other electronic track/trace technology, an 'electronic pedigree' will be created de facto for the product," the report says.

"An advantage of an 'electronic pedigree' is that it is harder to forge than a paper pedigree," the report notes. Adopting a universal pedigree would require development of "industry or national standards," it adds.

FDA noted that RFID technology is several years from widespread use. One "significant reason" use will be delayed is that RFID will not work until a system-wide infrastructure and an integrated database are created.

"An integrated database is one that is accessible to all users in the distribution chain for viewing data and contributing to the tracking of a particular product," the report says.

"Such databases and the associated 'reading' technologies could take several years to develop and gain widespread adoption throughout the marketplace. Issues that need to be resolved include: Who will create the database? Who will own the data? And, who has access to the data?" the report says.

FDA recommends taking "a phased in approach" for implementing emerging track/trace technologies.

"Achieve the goal of the pedigree requirements by phasing in track and trace technology (i.e. electronic pedigree) for all drugs and biologics starting at a case and pallet level for products at 'high risk of being counterfeited' and progressively including all products at the case, pallet and package level," FDA's report suggests.

"The technology should have an integrated infrastructure that is able to track and trace products at all points in the distribution chain from manufacturer to end user."

Until newer technologies can be implemented, FDA suggests drugs at high risk of being counterfeited should be tracked and traced by limiting the number of transactions. Another option would be using available technology, such as bar codes, to identify the drug at least at the case and pallet level, and preferably the product level, throughout the system.

In addition, FDA said manufacturers should use readily available authentication technologies until high-tech methods can be implemented. Authentication technologies allow specific products to be validated through "overt" or "covert" markers on the product or through "forensic" technologies relying on chemical markers.

The report advocates using a combination of authentication and track/trace technologies in all drugs.

"The task force recognizes the functions of authentication and track/trace technologies are complementary. In order to reduce the likelihood of counterfeit drugs being introduced, and to increase the likelihood of identifying counterfeit drugs in the U.S. drug distribution system, both technologies should be utilized," the report states.

Options the report advocates include using "unit of use" packaging for all finished dosage form drugs; using tamper-evident packaging for all dosage forms, active pharmaceutical ingredients and bulk chemicals; incorporating "at least two types of validated anticounterfeiting technologies into packaging and labeling at the point of manufacture with at least one of these technologies being covert"; and incorporating "a taggant, chemical marker, or other unique characteristic(s) into the manufacturing process that is only identifiable with the use of sophisticated analytic technologies."

The last two options should be phased in starting with products at high risk of counterfeiting and where counterfeits would pose a serious health risk.

The report also recommends creating an electronic database of drugs and biologics and the anticounterfeiting measures used for each product. The database would "expedite confirmation of a suspect counterfeit drug product's authenticity."

FDA should also issue two guidances, the report says. One would cover appropriate use of anticounterfeiting technologies "as well as the FDA application and review process for incorporating or changing taggants, chemical markers, or other unique characteristics of the product." The second would cover physical site security and supply chain integrity.

FDA will conduct cost/benefit analyses of the implementation of new technologies.

FDA has received considerable feedback on the costs associated with purchasing new technology and associated equipment, the integration into the manufacturing process and the creation of a new supply chain infrastructure. The report notes, however, that the task force has heard little regarding benefits of anticounterfeiting technologies other than drug safety.

The report suggests companies may benefit from improved inventory management, a reduction in labor costs, a reduction in theft, a reduction in diverted product, improved ability to recall product, protection from tampering and protection from having a drug used in terrorism.

"An area of focus for the task force as it gathers more information on anticounterfeiting technologies will be to find ways to maximize the benefits of new anticounterfeiting measures while minimizing their costs," the report says.

The interim report represents the work to date of the task force Commissioner McClellan created in July. FDA will hold a public meeting on counterfeit drugs Oct. 15 before issuing a final report in early 2004. FDA has invited technology vendors to display their products at the October meeting; at least 50 vendors have responded to date (² Also see "FDA Anti-Counterfeiting Public Meeting To Display Current Technology" - Pink Sheet, 8 September, 2003., p. 10).

The report concludes that a "multi-pronged" counterfeit prevention strategy should be used, and proposes options in four areas in addition to technology: secure business practices and regulatory requirements, rapid alert and response systems, education and public awareness measures and "international issues."

FDA is working to develop sets of "secure business practices" guidelines for manufacturers, wholesalers pharmacies and repackagers. The agency is working with the Healthcare Distribution Management Association to gather information on "best practices" in the drug wholesale industry (see ³ Also see "FDA Counterfeit Task Force Continues Work On Wholesaler “Best Practices”" - Pink Sheet, 6 October, 2003.).

Rapid alert and response systems will be used so FDA can respond more quickly to reports of counterfeit drugs.

"The task force believes that steps should be taken to facilitate reporting of suspect counterfeit drugs and that a central FDA voluntary reporting mechanism be used for reporting by the public," the report states.

Members of HDMA and Pharmaceutical Research & Manufacturers of America have agreed to notify the Office of Criminal Investigations within five days of determining that there is a "reasonable basis" to believe that a product has been counterfeited (⁴ Also see "Florida Pedigree Enforcement For 30 “Specified” Drugs Begins Sept. 1" - Pink Sheet, 30 June, 2003. p. 27).

FDA hopes to enact a program to educate consumers on how to proactively avoid counterfeit drugs.

"The task force believes that an educated, vigilant public is an invaluable defense against counterfeit drugs filtering into the U.S. pharmaceutical market. They need to be familiar with what to look for when faced with a potential counterfeit and the steps that need to be taken if they are suspicious that they have encountered one," the report says.

The task force has also identified a need to coordinate with international anticounterfeiting agencies. International cooperation could also involve developing global standards for packaging of final dosage forms and APIs, use of tamper-evident packaging, product pedigrees, use of anticounterfeiting measures and use of track/trace technologies.

"We still think the problem domestically is a very small problem, " FDA Associate Commissioner for Regulatory Affairs John Taylor said during an Oct. 2 conference call discussing the interim report. However, "the World Health Organization has done a quantification of the problem overseas and has noted that in some parts of the world, as many as 50% of the drugs are counterfeit," he added.

FDA Counterfeit Report Seeks “Electronic Pedigree” To Aid Drug Tracking

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