Extending the Stabilization Period

PC: Do you believe there is any chance of the FDA extending the stabilization period beyond Nov. 27, 2024?

Rowe: If history repeats itself, there's been some sort of delay in enforcement pretty much for every major deadline up until now. Now, I will say that you are correct. The FDA has recognized that small dispensers or pharmacies need more time to get ready, and it was announced right before the public meeting—and then was reinforced at the public meeting—that any pharmacies with 25 or fewer pharmacy and pharmacists on staff, would have another extension of the stabilization period, another two years. So actually, Nov. 27, 2026 for those smaller pharmacies. I think primarily pointed at independently owned pharmacies, was really the goal there. So the FDA has extended it, but only for those entities that qualify.

What FDA has stated is that any other type of trading partner—manufacturer, wholesaler, a larger dispenser—regarding the stabilization period, they're very adamant that it is not going to be extended in a broad fashion. What the FDA was really posing at the meeting and in their updated guidance was that they're not going to offer broad enforcement discretion, but if you as a specific trading partner don't feel that you can comply with the requirements after Nov. 27, you could file an individual waiver exemption or exception—fondly called a WEE—so the FDA is saying, we're not going to give a broad delay, but you, as an individual trading partner, can get one, but it's up to FDA’s review.

A lot of the public meeting was spent on how feasible is that, how many companies will apply. There are many companies now that maybe weren't thinking about filing for a waiver and exemption that are now. I think that's the stance from the FDA. I'll put on my Michael Rowe hat here—one of the recommendations that I made at the public meeting was that there still needs to be another relief valve beyond a trading partner-specific relief valve. And what I mean by that is, we have a customer that sends data, and then their customer goes, “Hey, you sent me the wrong data. Can you fix it?” It's those types of errors where the product is still good, and if a risk-based analysis is done to prove that it's not a suspect drug, can we at least let that product move so a patient doesn’t get impacted at the end of the day? I think that's the big worry. It’s not that there are companies simply not passing data, but it's when there's a problem with the data. we can't quickly fix it right now. So one of the recommendations that I hope FDA takes into consideration is almost a threshold risk-based approach that says, “as long as there's these other measures that are done to verify that the product is authentic, can we let the product go through, even though maybe the data isn't with that product.”

We obviously have to limit that. We can't make it super broad, because that could impact patient safety. If there's a blanket bypass allowed, that could potentially, like counterfeiters, go in and say, “Oh well, I'm operating under this bypass threshold allowance,” so it's got to be balanced, but I fear that if we even move the needle another 10%, that could make roughly a quarter of all medicines in the US quarantined at any given day.

There's not that much safety stock in the supply chain, and you now have a pharmacy that has a patient there trying to get the medicine, and they're saying, “I can't order the product because it's stuck at a wholesaler in quarantine because there's bad data on it.” It's going to be a hard—maybe pun, not intended—pill to swallow, to say, well, this is actually authentic product, but I can't give it to you because I can't validate the serial number.

So I think it's going to be a difficult position for a lot of companies to be in. I don't think FDA will give another broad enforcement delay like they have in years past, where they say everybody gets another year. It's going to be very controlled, very measured.

It was actually quite funny at the FDA public meeting, they did one of those word doodles, where people type in their response and they said, “what do you think FDA should do, or what do you what do you think about the stabilization period, and what should happen next?” As more people type in the same word, the bigger it gets on the screen. So all of a sudden, everyone starts saying, “enforce DSCSA, do not delay.” That becomes the biggest thing on the board, and then this other word stops coming up, “delay, delay, delay, delay.” So now up on the screen, you have two words that are in complete polar opposite of one another. I'm in the camp of another broad delay is not going to be beneficial to the industry.