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FDA Encourages RFID
Demir Barlas
November 16, 2004
Compliance Policy Guide for feasibility studies is next step in
top-level electronic pedigree and authenticity program; plenty of
manufacturer benefits in an inefficient supply chain
The U.S. Food and Drug Administration (FDA), which has been looking
carefully at radio frequency identification (RFID) technology as a way
to track and trace drugs from the point of manufacture to sale, this
week announced the creation of a Compliance Policy Guide for RFID
pilots and created a RFID Workgroup to ease and spread RFID adoption.
These initiatives are in service of the FDA's larger goal of embedding
RFID throughout the U.S. pharmaceutical supply chain by 2007.
2007 marks 20 years after the FDA first decided to establish an
electronic pedigree for certain drugs. The FDA has had to wait several
years for technology to catch up to and enable its vision, which is
that of encoding drugs with information about their ingredients,
manufacture, NDC and lot numbers, and sales orders and other
transaction information as they move from the factory to the consumer.
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The main benefit to consumers is that they can be sure that their
drugs (such as Viagra and OxyContin, which are going to be RFID-tagged
by Pfizer and Purdue Pharma, respectively, from now on) are not
counterfeit. This benefits pharmaceutical industries as well, as they
will not have to compete against pirated versions of their products.
There is a purer benefit for pharmaceutical industries in RFID's
advanced track and trace capabilities, that a lot of waste can be
taken out of what analyst Bruce Hudson of META Group says has been a
historically inefficient supply chain. "People buy for a little bit,
then get credit at a higher cost than they bought for," he says, by
way of example. "Or things can be returned three times." There's also
the problem of diversion. In short, Hudson says, "The pharmaceutical
supply chain is notorious for poor data management."
RFID isn't the only thing that'll help with that data management.
Electronic pedigree laws in Florida, for example, do not stipulate
that a pedigree be entirely electronic, so it could be force process
changes away from the technology realm. When California's law goes
into effect in 2007, though, the mandate will be for all-electronic
pedigrees. Even this isn't a boost solely for RFID, as Hudson points
out. "We'll see a combination of high-value items tagged with RFID and
lower-value items serialized with barcodes."
Hudson cautions observers to remember that this is not a mandate per
se. "The FDA will never go so far as to mandate a technology, which is
what Wal-Mart has done with EPC RFID." |
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