fda guidance

Welcome to the new world of serialized pharma products

Nov. 28 marks the first day when the US industry meets the DSCSA serialization mandate


After a 12-month postponement from the original deadlines written into the 2013 Drug Supply Chain Security Act, Nov. 27, 2018 was the last day for which wholesalers were to receive unmarked unit-of-sale pharma packages; from now on, they will include a 2D barcode (plus human-readable elements) that are intended to give each package a unique identifier.

Don’t be surprised, though, if Nov. 28 feels just like Nov. 27. Earlier this year, FDA clarified that unmarked product already in hand at distributors by Nov. 27 could still go into commercial distribution, at least for as long as the expiration date on the package was not exceeded—and that “grandfathering” represents some $4-5 billion worth of product already sitting in distribution centers. (Word was that some manufacturers were bulking up their inventories, expressly to get products shipped before the serialization deadline, so that figure is probably conservative.)

A big question has been how many manufacturers would actually be ready by the deadline. A spring survey by the GS1 organization and major wholesalers showed that at mid-year, roughly 21% of products were serialized. That number has undoubtedly jumped since then, but is probably not at 100%. Will FDA shut off the flow of unserialized product? Probably not—but noncompliance will carry high risk going forward.

A third factor for the relative quietude is that the serialization deadline for manufacturers is just one of a series of deadlines that started in 2015 and will continue to 2023. In coming years, pharmacies are supposed to verify that they are receiving serialized product, and later being able to track those serial numbers through their systems, entirely electronically.

Still, Nov. 28 is an important milestone for an initiative that kicked off around 2004 at FDA (and, arguably, could be traced back to the 1988 Prescription Drug Marketing Act). It’s been a long time coming, and an expensive one: IT costs are running around $1 billion for the industry; hardware costs have been estimated at $750,000-$1 million per packaging line, and if there are 5,000 packaging lines affected (including lines outside the US, but serving the US market), some $4-5 billion has been invested by the industry. Sources indicate that packaging line efficiency drops by 20-50% upon the start of serialization, then improves (under the best circumstances) to a 5% drop—and that has an ongoing operational cost penalty. Wholesalers are still scrambling to figure out how to verify delivery of serialized packages without opening each case as it arrives and performing a manual check—a process that could be a crushing burden to the fast-turnaround practices at most facilities.

This year represents the midpoint in the ten-year process (2013-2023) of implementing DSCSA. It has come a considerable distance, but still has a long way to go.