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What Isn’t Included in the Recent Exemption

Posted by bryan hanley On November 27, 2024 at 2:16 pm | Comments Closed

Published November 26th, 2024

Who Does It Apply To?

Recently, I shared that eligible trading partners were temporarily exempted from specific components of the Drug Supply Chain Security Act, “Latest DSCSA Exemption”. However, considering the stabilization period ends tomorrow, I thought I’d share some further insights on what isn’t part of the recent exemption.

First, as noted in my previous posts, the recent exemption doesn’t apply to everyone. As the FDA emphasized in their release, trading partners who are eligible for the exemption include “those who have initiated their systems and processes by successfully completing data connections with their immediate trading partners”, and “those who initiated processes including documentation of efforts to establish data connections but were not able to fully complete them with all immediate trading partners.” In other words, now is not time for trading partners to start initiating their systems and processes (that ship has sailed)—it’s time for trading partners to refine them.

Progress Necessary

The FDA wants to see progress made toward finalizing systems and processes capable of exchanging DSCSA transaction information and transaction statements with one another. Key enablers of this progress include:

  • Reconciling receipts of digital and physical representations of Serialized Information
  • Investigating suspect process
  • Verifying product for saleable returns
  • Responding to a trace request

In addition to documentation of progress, the FDA expects trading partners who plan to rely on the extension to communicate their intentions with immediate trading partners.

The FDA, similarly to when they announced their decision to implement the stabilization period, does not want trading partners to view this exemption as a “justification for delaying efforts to implement enhanced drug distribution security requirements.”

The deadline for compliance will come sooner than many expect, especially for manufacturers. In fact, there are only 129 working days until the May 27th, 2025 EDDS deadline.

Risks of Noncompliance

For those who haven’t initiated these systems and processes, punishments could be severe, and include:

  • Regulatory Risks: Potential for regulatory actions like warning letters, import alerts, or product seizures.
  • Operational Disruptions: Potential for supply chain disruptions and delays in product acceptance.
  • Market Exclusion: Risk of being completely excluded from the supply chain

Partners who do not meet the exemption criteria will need to submit a Waiver, Exception, or Exemption, or will more than likely face the consequences outlined above.

Stabilization Behind Us

Navigating DSCSA compliance amidst the constant changes to legislation can be tricky. However, one thing is for sure: if your business lacks systems and processes in place to implement EDDS requirements, the business is at risk.

With stabilization behind us, let Gateway Checker put you on the fast path towards supply integrity and regulatory compliance. Visit our website to view our services, or contact our team with any questions.

What Is Exempt, per recent DSCSA Update 

Posted by bryan hanley On November 22, 2024 at 8:45 pm | Comments Closed

According to the DSCSA Exemption Announcement from the FDA on October 9th, here are the specific components of the legislation that eligible trading partners are exempt from. 

Section 582(g)(1)(A-F) for Manufacturers and Repackagers, Wholesale distributors, and Dispensers 

‘‘(A) The transaction information and the transaction statements as required under this section shall be exchanged in a secure, interoperable, electronic manner in accordance with the standards established under the guidance issued pursuant to paragraphs (3) and (4) of subsection (h), including any revision of such guidance issued in accordance with paragraph (5) of such subsection. 

‘‘(B) The transaction information required under this section shall include the product identifier at the package level for each package included in the transaction. 

‘‘(C) Systems and processes for verification of product at the package level, including the standardized numerical identifier, shall be required in accordance with the standards established under the guidance issued pursuant to subsection (a)(2) and the guidances issued pursuant to paragraphs (2), (3), and (4) of subsection (h), including any revision of such guidances issued in accordance with paragraph (5) of such subsection, which may include the use of aggregation and inference as necessary. 

‘‘(D) The systems and processes necessary to promptly respond with the transaction information and transaction statement for a product upon a request by the Secretary (or other appropriate Federal or State official) in the event of a recall or for the purposes of investigating a suspect product or an illegitimate product shall be required. 

‘‘(E) The systems and processes necessary to promptly facilitate gathering the information necessary to produce the transaction information for each transaction going back to the manufacturer, as applicable, shall be required—  

‘‘(i) in the event of a request by the Secretary (or other appropriate Federal or State official), on account of a recall or for the purposes of investigating a suspect product or an illegitimate product; or 

‘‘(ii) in the event of a request by an authorized trading partner, in a secure manner that ensures the protection of confidential commercial information and trade secrets, for purposes of investigating a suspect product or assisting the Secretary (or other appropriate Federal or State official) with a request described in clause (i). 

‘‘(F) Each person accepting a saleable return shall have systems and processes in place to allow acceptance of such product and may accept saleable returns only if such person can associate the saleable return product with the trans- action information and transaction statement associated with that product. 

Section 582(c)(4)(D) For Wholesale Distributors 

(D) VERIFICATION OF SALEABLE RETURNED PRODUCT: Beginning 6 years after the date of enactment of the Drug Supply Chain Security Act, upon receipt of a returned product that the wholesale distributor intends to further distribute, before further distributing such product, the wholesale distributor shall verify the product identifier, including the standardized numerical identifier, for each sealed homogeneous case of such product or, if such product is not in a sealed homogeneous case, verify the product identifier, including the standardized numerical identifier, on each package.

Section 582(d)(4)(A)(ii)(II) and (B)(iii) for Dispensers with 26 of more full-time employees* 

‘‘(II) Dispenser must promptly conduct an investigation in coordination with trading partners, as applicable, to determine whether the product is an illegitimate product beginning 7 years after the date of enactment of such Act, verifying that the product identifier, including the standardized numerical identifier, of at least 3 packages or 10 percent of such suspect product, whichever is greater, or all pack- ages, if there are fewer than 3, corresponds with the product identifier for such product 

‘‘(iii) RESPONDING TO A NOTIFICATION —Upon the receipt of a notification from the Secretary or a trading partner that a determination has been made that a product is an illegitimate product, a dispenser shall identify all illegitimate product subject to such notification that is in the possession or control of the dispenser, including any product that is subsequently received, and shall perform the activities described in subparagraph (A). 

*Recall that an exemption was given to dispensers with 25 or less full-time employees already until November 27th, 2026. This is one year after the dispensers with 26 or more full time employees. 

For any questions regarding the exemption, feel free to contact the Gateway Checker team 

 

 

 

 

 

Verification Router Services: A Solution to Drug Shortages? 

Posted by bryan hanley On November 8, 2024 at 1:21 pm | Comments Closed

Published November 8th, 2024

The Importance of Collaboration to Address Drug Shortages

On October 31st, 2024, I listened to a compelling LinkedIn conversation hosted by Chip Davis of the Healthcare Distribution Alliance, titled “Working Collaboratively to End Drug Shortages.” Joined by Laura Bray of Angels for Change and April Gile of the End Drug Shortages Alliance (EDSA), the panelists emphasized the crucial role of collaboration in addressing the issue of drug shortages. Both of their organizations have taken tremendous strides in addressing the issue of drug shortages, an issue adversely impacting millions of Americans every single year. 

When organizations work as individuals, rather than cooperating, little is accomplished to address the drug shortage crisis. In the conversation, Bray stressed “I have so many examples of times where 3 people in a room did way more than 30 individual organizations trying to solve [the drug shortage crisis]. 30 people in a room working to the same goal can truly solve the crisis and save lives.” The complexity of supply chains and other communication barriers make cooperation more difficult; however, its organizations like theirs that are helping make this process easier. 

To address shortages, we must bring together supply chain partners who typically don’t interact with each other. As April highlighted in the conversation, transparency and proactiveness are the keys to success. She noted: 

“How do we identify shortage risks in a preventive way, ahead of a shortage vs. behind it? How do we think about promoting transparency between these partners who have really never worked (together) before around inventory awareness, and really create an effective collaboration approach to prevent disruptions ahead of time vs. being responsive after a disruption occurs.”  

Pharmaceutical partners must invest in systems and processes that encourage greater transparency across the supply chain; one of these solutions is product verification through the Verification Router Service (VRS). 

Could VRS Help Solve the Problem?

Though most understand VRS as a means to handle saleable returns, product verification through VRS could provide other benefits. VRS can help proactively address drug shortages in a variety of ways, assuming supply chain partners verify product both at the time of order receipt and delivery.  By identifying replenishment rates to better address supply and demand, authenticating sources to prevent improper disposals, and providing up-to-date product information to support inventory turnover, there is a major role VRS can play in addressing shortages. 

Traceability is currently limited to a one-up, one-back system, where partners only track drugs one partner before (direct supplier) and one partner after them (direct buyer). However, as drugs make their way from manufacturers to end consumers, there are usually 4-5 stops they make along the way; these stops include wholesalers, distributors, third-party logistic providers, and/or other partners. It’s clear to see how supply chain visibility and transparency can be limited from start to finish; product verification through VRS systems, if used effectively, can help address the drug shortage crisis. 

The challenge? Making VRS data available for every supply chain partner. Currently, VRS data goes directly back to the manufacturer. However, in consideration of the role VRS could play in proactively addressing the drug shortage issue, could we consider making the data available to all supply chain partners? Could centralizing this data for analysis address the root cause of drug shortages better than current methods? While industry partners would need to collaborate extensively for this to work, the added transparency and visibility integral to resolving the drug shortage crisis would make it well worth it. 

What do you think? Do you see a future where VRS helps prevent and resolve drug shortages?  

Revisiting Florida’s Plan to Import Drugs from Canada

Posted by bryan hanley On October 23, 2024 at 11:07 am | Comments Closed

An FDA-Approved Plan with Major Implications

Earlier this year, the FDA authorized Florida’s proposal to import select drugs from Canada under section 804 of the FD&C Act. The law allows companies to import prescription drugs in bulk if doing so saves Americans money and doesn’t put the health and safety of Americans at risk.

According to the office of Florida Governor Ron DeSantis, the proposal will save the state an estimated $180 million annually. More specifically, this program will reduce the price the state pays for medications used by certain groups, including older populations, foster children, and incarcerated individuals. Florida will begin with importing small cases of chronic medication, including those treating HIV/AIDS, mental illness, prostate cancer, and urea cycle disorder.

The FDA has emphasized that for Canadian drugs to be imported into the US, Canadian partners and American companies receiving them must adhere to additional security requirements. These include specifying the drugs they plan on importing, verifying drug authenticity and compliance with FDA-approved specifications, and relabeling these drugs in accordance with FDA policy.

Not Everyone Sees the Potential Benefits 

However, despite the cost-saving claims from Florida as well as the FDA’s approval of the change, many question the decision and the proposed benefits. Many experts believe this policy change will not solve the high-price issue of prescription drugs in the US. Critics argue the Canadian drug supply is too small, which means the change will not only have a minor impact on price reduction in the US, but could lead to major shortages throughout Canada. Four days after the policy change, the Canadian Government released the following statement:

“The Government of Canada is taking all necessary action to safeguard the drug supply and ensure Canadians have access to the prescription drugs they need and has been clear in its position: bulk importation will not provide an effective solution to the problem of high drug prices in the US.”

Accordingly, prominent members within the pharmaceutical industry have counteracted against the ruling; Stephen Ubl, President and CEO of Pharmaceutical Research and Manufacturers of America (PhRMA), believes the ruling has detrimental implications on American pharmaceutical supply chains. “The importation of unapproved medicines, whether from Canada or elsewhere in the world, poses a serious danger to public health,” Ubl claimed following the approval.

What Does this Mean for Compliance?

As to how these Canadian imports will comply with DSCSA Requirements, in particular Enhanced Drug Distribution Requirements, remains questionable. With Enhanced Drug Distribution Requirements delayed for connected trading partners in the US, will Canadian pharmaceutical manufacturers be expected to fully comply with DSCSA in November or will they be eligible for additional time for completion?

Is anyone aware of any Canadian pharmaceutical importation plans or activity since the policy change took effect in early January 2024?  Have Floridians spent $50 million implementing the plan? If yes, how did that ‘investment’ benefit American patients? Since more states may adopt a similar policy in the future, understanding fiscal costs and benefits is essential.

Finally, though Canadian imports must meet additional drug security requirements, will counterfeiters see this policy change as a money-making opportunity? Considering the numerous instances of domestic counterfeiting, we can’t count this out as a possibility.

Beware of Counterfeit Ozempic, says FDA

Posted by bryan hanley On October 15, 2024 at 1:05 pm | Comments Closed
Authentic Ozempic needle side by side with a fraudulent needle

Counterfeiting: A Major Issue with Drastic Consequences

On October 2nd, the FDA released an article highlighting the risk of unapproved weight loss drugs, including semgalutide and tirzepatide. These drugs pose a major risk to patients due to their lack of quality assurance. 

Illegally marketed versions of these drugs have infiltrated pharmaceutical supply chains, most notably, Ozempic. Counterfeit versions of the drug have been marketed as authentic, but could contain too much, too little, no active ingredient, or harmful ingredients. These illegal drugs pose a risk to consumers; in fact, according to a December 2023 report, 2 people died and three people were hospitalized after consuming counterfeit Ozempic.

Another DSCSA Delay

The FDA October 9th that they were delaying implementation of Enhanced Drug Distribution Security requirements, along with other requirements of section 582(g) of the Drug Supply Chain Security Act. This compliance extension would only be for trading partners who have made a documented attempt to complete data connections with immediate trading partners, or those who are already doing so. 

The FDA has emphasized the decision came from a concern over potential drug supply shortages. In the release, the FDA referenced trading partners’ struggles “resolving issues involving missing or erroneous data in electronic DSCSA transaction information and transaction statements” without delaying product distribution (including those in shortage) downstream. 

The concern for preventing supply shortages downstream is real. Preventing shortages can help minimize the risk of counterfeit products, given how shortages lead to higher rates of counterfeits as consumers are willing to pay higher prices for goods. However, what’s also important to consider is the reason behind creating Enhanced Drug Distribution Security (EDDS) requirements in the first place. 

Counterfeit Crisis: DSCSA’s Role

The Enhanced Drug Distribution Security requirements under the DSCSA were created for instances like this. Counterfeiters have become increasingly deceitful in their craft: packages with authentic lot numbers and detailed inventory trails make it very difficult to determine the legitimacy of drugs. Sight alone is simply not enough to authenticate legitimate drugs from counterfeits, especially for end consumers—just look at the image above!

Enhanced Drug Distribution Security requirements drastically reduce this risk, mandating product-level traceability and interoperability. Flagging down counterfeit Ozempic is much easier to do with EDDS requirements in place; the FDA delaying these requirements again could pose risks similar to what we’ve seen with Ozempic. 

While it’s essential to acknowledge the FDA’s commitment to preventing drug shortages, delaying EDDS requirements may bring about its own consequences.