What – Exactly – Does the FDA Mean By ‘Verification?’

By February 19, 2019 March 14th, 2019 DSCSA, Industry Insight, News, VRS

The clock is ticking for wholesale drug distributors, who have just nine months before they’re hit with the FDA’s November deadline for verifying saleable returns. Under provisions of the Drug Supply Chain Security Act, wholesale drug distributors will need to demonstrate that they’re verifying each product identifier on all restocked returns.

There’s just one little problem: No one knows what “verification” really means.

Man scanning package with VRS and 2D barcode

As much as $11 billion in saleable returns depends on effective serialization.

“The FDA has never specifically stated what would be an appropriate means to “verify,” says Anita Ducca, Senior Vice President of Regulatory Affairs for the Healthcare Distribution Alliance. “We’ve all been trying to determine what would meet the DSCSA verification requirements.”

Instead of waiting for the FDA, the pharma industry is moving to establish its own preferred standard – Verification Router Service.

What’s the best practice?

The need to identify a single best practice for verification is clear for several reasons:

  • There’s a lot of money at risk. The HDA estimates that annual drug returns total nearly 59 million units with a value of $13 billion. Of those returns, $11 billion constitutes saleable products.
  • The FDA is serious about enforcement. As I noted last week, the agency already fired an expensive warning shot, directly citing DSCSA requirements when it issued a Form 483 Warning Letter to one of the country’s largest wholesale distributors after slapping the company with $150 million fine over suspicious product handling.
  • Wholesalers and manufacturers are scrambling. Some VRS solution providers still have their software on the drawing board, making it difficult for wholesalers and others making a purchasing decision to be sure what they’re buying will meet FDA standards.
  • What worries me the most: Research conducted by the HDA finds that some companies could be wasting time and money pursuing verification options that are doomed to fail.

Let me expand on that last point. The HDA examined nine scenarios for saleable returns under the verification standard that kicks in this November. This 2016 study surveyed seven pharmaceutical manufacturers and six pharmaceutical distributors, with striking results: Out of nine verification approaches, researchers found only two the alliance could recommend to satisfy DSCSA rules.

The scenarios included:

  • Three for manufacturers: Scanning Product Identifiers at the time of shipment and sending that data to trading partners; sending all PIs to every direct trading partner; or sending PI data to a central database.
  • Six for Distributors: Scanning all inbound or outbound products; setting up a point-to-point interface with every manufacturer; using a portal set up by each manufacturer; calling or emailing each manufacturer directly to verify returns; and installing a Verification Router Service.

You can scan these brief descriptions and immediately see how expensive, complex, and impractical most of them would be to implement. Some responses would require a distributor to hire staff to build and manage its own in-house database of Product Identifiers and connect it with each individual trading partner.

Even one of the two approaches recommended by the HDA was far from simple. That would involve manufacturers scanning and aggregating all product identifiers in shipments, then transmitting that data to each individual distributor. Each of those distributors, in turn, would need to build its own internal database to verify returned product.

Why VRS is the choice

As you might guess, the other HDA recommendation was using a Verification Router Service, a central, external repository for PIs that can easily be accessed by manufacturers and distributors and linked to warehouse scanners. Manufacturers get to maintain all their product information internally and queries can be handled automatically. That’s why we at LSPediA focused our verification solution on creating a stand-alone VRS application guaranteed to seamlessly integrate with any and all existing serialization applications.

One reason suppliers will want to hew to this HDA recommendation is that it’s the only guidance out there.

“Although the FDA has never publicly disagreed with any of our nine scenarios, it has not specifically stated its agreement, either,” Anita Ducca told me. “The FDA also hasn’t published guidance of its own.”

The most activity we’ve seen from the FDA so far has been to issue draft guidance on verification systems for industry comment last fall. While the draft spells out many specific details for meeting DSCSA requirements, the document doesn’t outline any specific solution.

Instead of waiting, the industry is moving solidly in favor of VRS as the preferred solution. A recent LSPediA survey found that nearly 40 percent of the manufacturers polled preferred using only a VRS system and wouldn’t share EPCIS data with their customers. That will leave any trading partner depending on EPCIS data-sharing out of luck to verify returns. In addition, LSPediA found that two-thirds of trading partners were either planning to add a VRS platform or already had purchased one.

It’s easy to see why VRS is so quickly emerging as the dominant pharma supply chain solution. VRS is simple, efficient, and dependable. That’s obvious to all of us in the industry. It won’t be long before the FDA gets on board, too.

About LSPediA – Life Sciences Solutions

LSPediA is a leading supply chain software provider for the pharmaceutical industry. LSPediA’s serialization solution RxChain®, RxChain™ Mobile, and Saleable® protect pharma companies against regulatory risks and improves supply chain efficiency. Pharmaceutical manufacturers, wholesale distributors, dispensers, and healthcare providers partner with LSPediA to manage serial data, distribute serialized drug products, verify the validity of the drug product. To learn more, please call (248) 973-2008, email us, or visit www.lspedia.com.