FDA Exempts Manufacturers from WDD and 3PL Annual Reporting

By January 24, 2017 April 30th, 2018 DSCSA, Serialization, Track and Trace

The FDA’s recently published draft guidance for the industry, “Annual Reporting by Prescription Drug Wholesale Distributors and Third-Party Logistics Providers: Questions and Answers,” is one of the most helpful DSCSA guidance documents issued to date. The clarity it offers is a departure from its ambiguous predecessors, which often left (and sometimes created) many unanswered questions. This new document resolves some of those issues by responding to a total of 39 questions. While they are specific to wholesale drug distributors (WDD) and third-party logistics providers (3PL) annual reporting of state licenses, it’s worth everyone’s time to read it over, especially manufacturers.

Answers from the FDA

The first Q&A in the guidance document addresses manufacturers:

Question: “Is a manufacturer, currently licensed by a State as a wholesale distributor, required to report this license?”

guidance image for blogAnswer: “A manufacturer that is engaged in wholesale distribution, as defined in section 503(e)(4) of the FD&C Act (21 U.S.C. 353(e)(4)), as amended by the DSCSA, is required to report information related to its wholesale distributor license (see section 503(e)(2)(A) of the FD&C Act). However, the distribution of a manufacturer’s own drug is exempt from the definition of wholesale distribution (section 503(e)(4)(H)). As a result, if a manufacturer is only distributing its own drug, it would not be engaged in wholesale distribution, and would not be required to report under Federal law, even if the manufacturer has a wholesale distributor license issued by a State.”

I imagine the FDA gets this question a lot. In 2015 the FDA established a registration database for WDDs and 3PLs. Since then more than 23,000 entries have been entered into the system. Interestingly, thousands of them are manufacturers. The DSCSA does not require manufacturers to register, but also did not exempt them from registering. Through many discussions with our manufacturer-clients, I learned that even though it wasn’t a requirement, manufacturers felt it was better to be safe than sorry. This abundance of caution resulted in thousands of manufacturer entries in the WDD and 3PL database.

Waiting… and Waiting… for Licensing Regulation

The DSCSA, as it was written, intended to enforce national traceability standards as well as national standards for prescription drug wholesalers, including licensure. There was much success with the former – it pre-empted state-level pedigree laws and unified the industry on one national product tracing rule. The latter, however, has been slow in coming. The DSCSA requires that the FDA, no later than two years after DSCSA enactment, “establish by regulation standards for the licensing of” wholesale distributors, “including the revocation, reissuance, and renewal.”

The deadline was 14 months ago, and we are still waiting for the licensing regulation. And there’s been a price to pay: Absence of a national standard has created general confusion, local issues, and inconsistencies from state to state. At the FDA’s public meeting on November 10, 2016, the HDA and other stakeholders described the problems that are arising—and worsening—due to the lack of licensure standards for WDDs and 3PLs. “Some States are imposing requirements that are contrary to and more burdensome than what the DSCSA requires,” said the HDA in its comments to the FDA on November 14, 2016.

The DSCSA presents daunting challenges for partners in the pharmaceutical supply chain. And it’s an equally challenging policy for the FDA to execute and regulate, due in large part to the fact that the majority of the requirements in the DSCDSA exist in uncharted territory—such as national licensure standards, serialization, and returns verification. Similar to the industry peers, the FDA has limited resources, budget, and qualified people.

More like this, Please

In summary, I do appreciate any guidance from the FDA that offers clarity to the industry. Companies governed by the DSCSA are making significant investments in people, processes, and new systems. Clarity and guidance from above can help them protect those investments, and save them from taking a wrong turn that could result in significant waste. This new guidance is a must read, for everyone. I urge you to familiarize yourself with the information—perhaps it will save you from undertaking unnecessary tasks in the name of compliance.

DSCSA, Track and Trace, and Serialization Guidance from LSPediA

To get your business on the road to DSCSA compliance, contact LSPediA. We can ensure you understand and successfully implement a DSCSA strategy using our industry-tested serialization toolkits and our new, innovative traceability solution, Rx Chain.

 

About LSPediA – Life Sciences Solutions

LSPediA is a leading provider of enterprise software and services designed for pharmaceutical manufacturers, wholesale distributors, and dispensers. With help from LSPediA, customers can better implement serialization and aggregation processes to meet global regulations, DSCSA requirements, and future track-and-trace mandates.

We value long-term relationships and work with our clients’ internal teams to properly define roadmaps, create architectures, and implement systems that align to vital business goals, ultimately helping them derive maximum value from their investments, both now and well into the future.

For more information about LSPediA, call +1 (248) 973-2008, email info@lspedia.com, or visit our website at www.lspedia.com.

For additional information, contact: Julianne Jahn jjahn@lspedia.com