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Friday, November 15, 2013

Pharmaceutical Supply Chain Security

Susan Thaul
Specialist in Drug Safety and Effectiveness

The drug package that a community pharmacist hands to a patient, or a hospital pharmacist sends to a patient’s bedside, or a physician administers in the medical office has reached the end of a complicated path. That path is called a supply or distribution chain. The upstream portion of the chain includes the journey of each active and inactive ingredient and their chemical components to the manufacturer that creates the finished drug product. The downstream chain, which this report addresses, includes the repackagers, wholesale distributors, associated storage and transport companies, and, finally, the dispenser. Dispensers include independent community or chain pharmacies, hospitals or other health care facilities, and physicians’ offices.

Usually the supply chain provides consumers with unadulterated prescription drugs. However, the chain is potentially vulnerable, and when it breaks, a dispenser might provide a counterfeit product containing no active ingredient, less-than-labeled dosage, or a dangerous substitution. The dispenser might also provide a mishandled or diverted drug that has become sub- or superpotent or has gone past its expiration date. In addition to the potential harm to patients, these security breaches can affect a manufacturer’s reputation and financial bottom line.

Congress has addressed pharmaceutical supply chain security several times over the past 107 years. The 1906 Food and Drugs Act focused on labeling; the 1938 Federal Food, Drug, and Cosmetics Act (FFDCA) addressed adulteration, misbranding, and the registration and inspection of manufacturing establishments; and the Prescription Drug Marketing Act (PDMA, P.L. 100- 293) required that wholesale distributors be licensed by the states and required that a wholesale distributor, except one in a specified ongoing relationship with the manufacturer, provide to the purchasing distributor or dispenser a statement—called a pedigree—“identifying each prior sale, purchase, or trade of such drug.” More recently, the Food and Drug Administration Amendments Act of 2007 (FDAAA, P.L. 110-85) required the Secretary to “develop standards and identify and validate effective technologies for the purpose of securing the drug supply chain against counterfeit, diverted, subpotent, substandard, adulterated, misbranded, or expired drugs”; and, in 2012, the Food and Drug Administration Safety and Innovation Act (FDASIA, P.L. 112-144) expanded registration and reporting requirements. Despite current federal law and actions by state legislatures, opportunities for breaches of the supply chain continue to exist. The 112
th and 113th Congresses have worked to craft a set of national requirements that would protect both patient and manufacturer, and allow the assignment of accountability for identified problems, while attempting to manage cost and avoiding a confusing patchwork of state legislation.

In their work, House and Senate policymakers have been considering many decisions. These include, for example, definitions; pedigrees; track-and-trace technologies; serialization; lot- and unit-level requirements; authentication; interoperable data collection and systems; data confidentiality and access; requirements for transaction reporting and notification regarding suspect deliveries; implementation timing; licensure, registration, and accreditation standards for entities in the supply chain; accountability; cost; and the relationship between federal and state laws. After passing individual bills (H.R. 1919 and S. 959), majority and minority leadership of the House Committee on Energy and Commerce and the Senate Committee on Health, Education, Labor, and Pensions announced an agreement on September 25, 2013. The House passed the text of the agreement, H.R. 3204, on September 28, 2013, and the bill awaits Senate action. 

Date of Report: October 31, 2013
Number of Pages: 21
Order Number: R43106
Price: $29.95

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