RFID Strategy -- Pharmaceutical E-Pedigrees and RFID

Oct. 15, 2007
Florida, California give impetus to initiative stalled at Federal level.

A recent announcement from Nosco focuses on the use of RFID in the pharmaceutical supply chain. This news prompted me to review the current state of the e-Pedigree initiative for pharmaceuticals. I found that Florida state law has pushed forward standards for electronic signature capture and verification. And a recent announcement from California could drive e-pedigree compliance (including RFID use) for significant chunks of the market by January 1, 2009.

But just what is driving the pharmaceutical e-pedigree initiative? I'd like to explore this question before delving into Nosco's RFID technology news.

Recap of FDA policy

As I have covered previously, the e-Pedigree requirements are grounded in a 1988 set of FDA regulations enacted following the passage of the Prescription Drug Marketing Act (PDMA) of 1987.

The PDMA was written to address the problems of drug counterfeiting in the pharmaceutical supply chain. Pharmaceuticals pass through many different points in the distribution chain from the factory to your local pharmacist. This leaves the system vulnerable to the introduction of counterfeit drugs. For this reason, the PDMA requires verification of the source of pharmaceutical shipments. The method of accounting for where a pharmaceutical comes from and verifying it to be legitimate is called the "chain of custody." It has been largely paper-based for many years.

Since 2004, the FDA has been investigating the use of RFID technology to make the chain of custody less labor-intensive and more secure. At the time, the FDA anticipated that the e-pedigree would be achievable by 2007. However, in late 2006, a Federal judge in New York ruled that the FDA requirements placed an undue burden on small pharmaceutical manufacturers. The current status of the FDA e-pedigree program is in doubt pending the outcome of the Federal case. But, as is often the case, large states are driving technology even as the Federal effort stalls.

A Modest Step Forward

Florida took a significant step in 2006 by expanding the state requirements for paper-based pharmaceutical pedigrees. As part of the provision, Florida set up a system for electronic verification of pedigrees. The system relies on the existing EDI backbone and utilizes public key infrastructure (PKI) digital signatures. This was a significant development for the RFID market, since the methods used under the Florida program are easily integrated into an RFID tagging solution. In fact, the Florida requirements are acknowledged and supported in the recently released EPC Global "Pedigree Ratified Standard" dated January 5, 2007.

The Florida requirements are effective today. They provide a system for both paper-based and electronic pharmaceutical pedigree transactions. Combined with the recently released EPC pedigree RFID information standard, these requirements provide an impetus to move towards RFID-based e-Pedigree solutions in one of the nation's most populous states.

An Ambitious Vision

While Florida takes an evolutionary approach to e-Pedigrees, California has enacted a law that seeks to transform the pharmaceutical industry. This is similar to the role California played in setting automotive emissions standards in the 1970s. California hopes to lead a technology standard by virtue of its sheer market size.

The recently enacted California e-Pedigree law requires drug companies, wholesalers, and hospitals to enact electronic traceability for pharmaceuticals by January 1, 2009. It does not specify the use of RFID tags, but industry opinion is that every mid-sized or larger drug company will put an RFID tag on at least one product in response to this law.

Industry Responds to Opportunity

The Nosco press release mentioned previously points to a significant initiative to sell RFID solutions to meet the requirements of the new California law. Nosco is a manufacturer of pharmaceutical packaging. They have partnered with Hewlett Packard, Systech International (a packing and software technology vendor), and e-pedigree software developer SupplyScape to provide a fully compliant solution to the California e-Pedigree requirements. The solution incorporates packaging line technology, RFID tags, barcodes, readers, e-pedigree software and system integration solutions. This solution is available now to allow customers to gain experience with the process prior to the legal deadline of 2009.


The future for e-pedigree solutions looked uncertain at the end of 2006, given the stalled progress of the FDA initiative. However, the perceived benefits of e-pedigree solutions are so significant that states are moving forward with their own requirements. Industry is beginning to respond with solutions. Expect the RFID market to become very active around pharmaceutical e-pedigree topics throughout the rest of 2007. Given the size of the California market, I anticipate more major product announcements timed for the trade shows scheduled for early 2008.

Paul Faber is a Principal with Raleigh, N.C.-based Tompkins Associates, a supply-chain-solutions consulting firm. As the chief manager of RFID equipment implementation at Tompkins Emerging Technology Center, he possesses extensive experience in material handling solutions, systems integration, and installation. Paul has managed field integration and operations activities at material handling sites around the world.

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