Perry Fri - Executive Vice President, Industry Relations, Membership and Education, Healthcare Distribution Alliance; Chief Operating Officer, HDA Research Foundation
Progress toward the 2023 Drug Supply Chain Security Act (DSCSA) requirement for full product serialization is uneven, with some progress and obstacles appearing as healthcare supply chain partners implement the data requirements. These are among the findings in a fourth quarter 2021 EPCIS Implementation Benchmarking Survey, conducted by the Healthcare Distribution Alliance (HDA) Research Foundation.1 This resource updates on industry progress toward DSCSA compliance since the survey was last administered in spring 2021.
As the trade group representing distributors of pharmaceutical and other healthcare products, HDA serves as a convener and intermediary between industry stakeholders and regulatory authorities in the U.S. to help the distribution sector reach consensus on implementation requirements. HDA has led the charge alongside its members toward federal traceability for over two decades, playing a large part in the creation and passage of the DSCSA in 2013.2
While distributors continue to progress in their implementation, very few manufacturers have moved from development into production, and in some cases have increased their reliance on third-party logistics providers (3PLs). These 3PLs often face further delays as they await manufacturers that either have yet to fully understand or commit to the necessary changes.
On November 27, 2023, pharmaceutical supply chain trading partners are expected to be fully compliant with the DSCSA by making sure that transaction data for packages meet FDA standards. By the deadline, data must be transacted between partners in the pharmaceutical supply chain in a secure, electronic, interoperable manner and must comply with a form and format developed by a widely recognized international standards development organization.3 GS1’s Electronic Product Code Information Services (EPCIS) serves as the only widely recognized standard that allows trading partners to fully comply with the FDA guidelines.
While the DSCSA requires transaction data with product identifiers to be provided with physical product on November 27, 2023, many industry stakeholders have realized that they must prepare well in advance of this date to ensure that:
- Business-to-business AS2 connections are made;
- Master data are transmitted;
- Data are properly formatted and received;
- Processes are established for when errors occur; and,
- Existing inventory has corresponding data when shipped after November 27.
The HDA Research Foundation conducted this survey to enable more transparency and accountability among these sectors in their implementation of the EPCIS standard. With data from 40 manufacturers, 16 distributors and four 3PL providers, some significant trends have emerged that demand industry focus.
Manufacturers Hold the Line
The survey identified an increase to 69 percent in manufacturers seeking to rely on 3PL firms to connect transactions to distributors, up 7 percent from the previous survey. When asked to identify obstacles to implementing EPCIS, manufacturers cited a lack of FDA guidance and a prevailing sentiment that the agency will not enforce its 2023 deadline due to past enforcement discretion delays. Yet the FDA has stated at various industry events that the deadline will not be extended, and officials have noted the agency is working at “full-tilt” to ensure an interoperable supply chain.4 Manufacturers also acknowledge that a lack of adequate employee resources to test and implement EPCIS has persisted at the organizational level.
While the majority of manufacturers have already transitioned to EPCIS 1.2, the minimum version of the standard to comply with DSCSA requirements, this doesn’t guarantee data are being exchanged in a production environment. As of Q4 2021, more than half of manufacturers reported they are not in the process of connecting with distributors and approximately 55 percent were not connected to distributors in production.
Third-Party Providers in the Middle
The 3PLs surveyed are working to connect 81 manufacturer clients on average and each currently have about four connections in place, with four other connections in process. Once fully implemented, 3PLs plan to have connections with 104 distributors. This group largely stated a lack of understanding or commitment from other industry partners to be their primary obstacle but also admitted to lack adequate employee resources.
Service providers and 3PLs need to wait for their manufacturer customers to proceed; however, manufacturers must often make nuanced decisions around the range of services they want 3PLs to deliver. Overall, implementation has proven to be more complex than originally expected. And since 3PLs and other providers often have as many as six interfaces to connect to serve their supply chain customers, such a level of technical complexity calls for more up-front planning. Accordingly, vendors are alerting manufacturers that they can’t guarantee compliance if manufacturers can’t work to secure a solution by next spring.
Distributors Continue Progress
Distributors have made additional headway toward compliance, with now just 38 percent of these partners yet to connect to manufacturers, down from 58 percent in September. More than two-thirds of distributors are in the process of connecting to manufacturers in a production environment. The top obstacle cited for any lack of momentum among distributors was lack of trading partner commitment, at 88 percent. No distributor respondents reported having connections with dispensers, with the clarification that most, if not all, dispensers will look to wholesale distributors to provide a portal to access transaction data.
Moving Forward
Much of this news is a move in the right direction. We at HDA have seen encouraging developments, including more collaboration and outreach between partners to work through issues. For instance, some distributors are providing or plan to provide data checks against physical product to provide feedback to manufacturers on how product and data align. Manufacturers are working with service providers on GS1 conformance testing to ensure quality of the data before it reaches distributors. Improvements such as these are promising in speeding up onboarding processes that can often take three to six months, which is unsustainable in the current timeline. But let’s keep the momentum going — HDA and the distributor community encourage trading partners to redouble their commitment to EPCIS adoption in the next year and a half.
HDA has helped establish several resources and working groups in support of meaningful progress toward DSCSA compliance. For example, we, along with several service providers, established an EPCIS Center of Excellence (COE) to convene leading service providers to identify issues and create checklists of best practices.5 In anticipation of the HDA Traceability Seminar (October 12–14, Washington, D.C.) we will also be opening our EPCIS COE biweekly meetings to all industry participants to share and navigate concerns. We’re also partnering with GS1 to create just-in-time trainings around EPCIS onboarding. We host a quarterly task force to talk about issues with EPCIS implementation, with upcoming meetings in July and November of this year. (Those interested in participating in the COE or future surveys can contact HDA’s Jaidalyn Rand at [email protected].)
Healthcare supply chain partners have their work cut out for them in the coming months. We are hoping to see more progress when HDA releases subsequent surveys each quarter. The time has come for all partners across the pharmaceutical supply chain to share resources and keep lines of communication open, as the FDA has indicated no plans of extending the November 27, 2023, compliance milestone.
References
- EPCIS Implementation Benchmarking Survey. HDA Website. Available at: https://hda.org/ resources/epcis-implementation-benchmarking-survey. Published March 2022. Accessed March 28, 2022.
- Pharmaceutical Traceability. HDA Website. Available at: https://www.hda.org/issues/ pharmaceutical-traceability. Accessed April 12, 2022.
- U.S. Food and Drug Administration. DSCSA Standards for the Interoperable Exchange of Information for Tracing of Certain Human, Finished, Prescription Drugs: How to Exchange Product Tracing Information: Guidance for Industry, Draft Guidance. Available at: https:// www.fda.gov/files/drugs/published/DSCSA-Standards-for-the-Interoperable-Exchange-of-Information-for-Tracing-of-Certain-Human--Finished--Prescription-Drugs--How-to-Exchange-Product-Tracing-Information.pdf. 79 FR 70878. Published November 28, 2014. Accessed April 13, 2022.
- Eglovitch JS. FDA official: Agency will not extend 2023 DSCSA interoperability deadline. Regulatory Affairs Professional Society website. Available at: https://www.raps.org/news-and-articles/news-articles/2021/8/fda-stands-firm-on-november-2023-interoperability. Published August 11, 2021. Accessed March 28, 2022.
- Antares Vision Group, Through rfxcel, Announces EPCIS Center of Excellence to Enable DSCSA Serialization Requirements by 2023. Antares Vision Group Website. Available at: https://rfxcel.com/antares-vision-group-rfxcel-announces-epcis-center-excellence-enable-dscsa-serialization-requirements-2023/. Accessed March 28, 2022.
Perry Fri oversees HDA's development of initiatives that facilitate improved business processes and healthcare supply chain efficiencies. As head of the HDA Research Foundation, he helps promote the industry's ability to deliver efficient and safe patient access to medicines and medical products through research and educational initiatives. He currently serves as Chairman of Healthcare Ready, a 501(c)(3) organization established to help public and private sector healthcare stakeholders manage through disasters.
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