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TraceLink reveals webinar survey findings about how companies have adapted to lot-level requirements and DSCSA serialization deadlines.

The Drug Supply Chain Security Act (or the DSCSA) is a name that seems to be on everyone’s lips these days. With 2016 teetering to a close—and the looming November 2017 deadline coming ever nearer—many companies are making fast and furious plans to finalize their serialization implementation efforts.

On Tuesday, December 13, TraceLink and Actionable Research hosted a webinar titled “Global Drug Supply, Safety and Traceability Report: Using 2015 Lot-Level Learnings to Understand Future Serialization Challenges.” The companies surveyed 331 professionals in the pharmaceutical industry, including pharmaceutical manufacturers, wholesale distributors, hospitals, and pharmacies in an attempt to understand lot-level compliance challenges.

One of the two webinar presenters, Shabbir Dahod, President and CEO, TraceLink, participated in an exclusive Q&A with Pharmaceutical Processing about the findings of the survey as well as an overview of the industry’s serialization efforts. His edited responses are below.

To start, what led you to survey these 331 pharmaceutical industry professionals? What were some of the questions you asked them?

Dahod:

We recognized that some of the preconceived notions about the supply chain were not what we were seeing being implemented and executed by our customers, so we wanted to test that to understand why. Then, once we went down that path, we wanted to know the challenges around the network topography, partner relationships, and information exchange requirements to make sure we understood the full breadth of the supply chain for lot-level implementation. We also wanted to learn about how lot-level was implemented by the industry to apply those learnings to how the industry can better prepare for serialization.  

In your opinion, what were some of the most impactful findings of the survey? Did anything surprise you?

Dahod:

I was surprised by a few things. Most notably, the perception that 90 percent of prescription drugs sales go through the “Big Three” wholesalers is a narrow way to view the supply chain. When you take all pharmaceutical companies, equally weighted, since every company needs to comply with the regulations, then the distribution network becomes much broader than just the “Big Three.”

It’s a different perspective on how to view the compliance challenge. By the sheer number of relationships in the supply chain at all levels—wholesalers, upstream, downstream—I surprised by how varied and complex it became.

The other aspect I was surprised by were that information requests among trade partners were bi-directional. Everyone had needs for information beyond compliance in order to be successful at complying with the law.

Finally, the percentage of companies unable to comply with lot-level regulations, at the time of the survey, was very surprising to me. 

Did your findings differ significantly across companies in the supply chain (pharmaceutical manufacturers, wholesale distributors, etc.)?

Dahod:

The findings certainly differed across all three segments, mostly in the lot-level and serialization readiness portions, given the different DSCSA deadlines for each segment.

Most notable differences were seen in the dispensers’ methods of managing lot-level compliance (50 percent did it manually, 64 percent of hospitals sent paper T3, and 54 percent of retail pharmacies sent paper T3).

When looking ahead to serialization, 32 percent of hospitals and 41 percent of retail pharmacies were not at all familiar with the 2020 requirement that they accept only serialized product.

How have companies that sell product into the U.S. adapted to DSCSA lot-level requirements?

Dahod:

Overall, we found that the majority of respondents found compliance achievable—but difficult. Across all segments, more than half of the companies are sending documentation to some (but not all) trading partners and some were not able to address the requirements at all. 

We also found that many respondents used a combination of a purchased solution, existing business system, custom software, and a manual approach to comply with lot-level requirements.

Generally, for those who did achieve compliance, respondents reported that it was more difficult to achieve on multiple fronts. For pharmaceutical companies, implementation complexity and cost of IT upgrades were the biggest surprise. Thirty-five percent underestimated implementation complexity and 30 percent underestimated the cost of IT upgrades. 

Wholesalers were more challenged by implementation complexity and operational impact—with 49 percent of them underestimating implementation and 40 percent did not predict the extent of the impact on their business operations.  

Across all respondents, what was the biggest concern for serialization and which segments feel that they are ready?

Dahod:

All three segments acknowledge that serialization is expected to be more challenging than lot-level. Respondents pinpointed the following areas of concern:

  • Pharmaceutical companies expect increased complexity across the board. About half of these companies feel that serialization will be more challenging in terms of data volumes, customer connectivity, overall implementation, and operational impact.
  • Wholesalers are most concerned with implementation and operational impact, considering these to be the most challenging. 

In terms of serialization readiness, only 54 percent of pharmaceutical companies believe they’re ready. Of those who do feel prepared, nearly one third cited their understanding of all the requirements as the main reason. Only 22 percent of distributors feel their company is prepared. Those who don’t feel prepared worry about the clarity of implementation requirements and connectivity to suppliers.

Dispensers are still learning that there is a requirement. Thirty-two percent of hospitals and 41 percent of retail pharmacies were not at all familiar with the 2020 requirement that they accept only serialized product. Twenty-nine percent of hospitals and 46 percent of retail pharmacies were also unaware of the 2023 stipulation that all transaction data be exchanged between them and their suppliers electronically. 

In your opinion, how prepared were companies for the upcoming serialization deadlines? If their preparedness could be improved, what are your recommendations for next steps?

Dahod:

We’re seeing through our customer base that the industry is beyond the 50 percent mark now (since this survey was taken to measure 2015 findings). The last 20 percent of the industry (pharmaceutical manufacturers) will be challenged to make the November 2017 deadline.

How have serialization efforts impacted the relationships between companies in the pharmaceutical supply chain (such as manufacturers and wholesale distributors)?

Dahod:

We’ve already seen that it’s making companies in the pharmaceutical supply chain better business partners, allowing them to collaborate more effectively, share more information, and improve individual operations. All areas are being addressed that were not being addressed before. It’s improving everyone’s execution.

Have you found that there are certain areas in serialization implementation that many companies are pushing for customization (vs. standardization)? If so, please explain.

Dahod:

In reference to standardized digital formats for serialization, one-fourth of pharmaceutical companies haven’t thought through the details. When asked how they will enable and deliver electronic serialization data, 35 percent of pharmaceutical companies and 62 percent of wholesalers are unsure of their preferred format for sending serialization data. The pharmaceutical companies know what they want and have a clear preference for EPCIS, whereas the undecided wholesalers are split between EPCIS and serialized ASNs.

In your survey, what percentage of companies have been unable to achieve compliance at all? Why do you think that is?

Dahod:

Nineteen percent of pharmaceutical companies, 11 percent of wholesalers, and 20 percent of dispensers did not achieve lot-level compliance. 

I think they started too late, underestimated the amount of effort, and are not expecting to be inspected.

What aspects of serialization pose the most risk to the industry’s success?

Dahod:

The information exchange—just the sheer scale of information processing. It’s a technical challenge to be able to meet those requirements and efficiently connect with all their partners and exchange data efficiently in the format that each partner needs.

To view the webinar, click here.

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