Counterfeiting and diversion
Counterfeit drugs are a growing global problem, one that the biotech industry shares with other sectors in the life sciences.
While some of the most troublesome cases involving counterfeit drugs have flowed through traditional drug distribution channels,
globalization of drug manufacturing techniques and direct-to-consumer product delivery via the Internet, mail, and direct-to-door carriers have formed new distribution channels for counterfeit drugs. Other issues
include increased production of counterfeit pharmaceuticals and biotechnology products in locations that are sources of supply
for legitimate products, such as China.
The introduction of counterfeit or diverted biotechnology products into legitimate channels is a real threat that requires
oversight from brand owners and their supply chain partners. The impact of counterfeit drugs is felt across the whole supply
chain—at times with fatal outcomes. There are a number of mechanisms and techniques either in use or in development and design
to ensure that the biotech product is authentic and to combat counterfeiting. This includes a drug pedigree or, in conformance
with pending California legislation, an ePedigree. (An ePedigree is an electronic record containing the information regarding
each transaction resulting in the change of ownership of a prescription drug from the manufacturer through distribution to
the dispensing of an individual unit of a drug by a pharmacy or hospital. Companies are required by FDA to maintain pedigree
reports and must be prepared to have them audited.) With proper implementation and controls, the chain of custody for a pedigree
document can be established, creating a high degree of confidence in the origins and authenticity of an item.
Forging the links across the chain of custody
Short product life cycles—that is, compounds and components that are susceptible to variations in temperature, vibration,
and environmental factors—create challenges for all participants in the biotech supply-chain community. Visibility across
the chain of custody in an increasingly global network has become a necessity.
When addressing the challenges of global logistics, with additional complexity of regulatory compliance, one should take into
account both sources of demand and supply, providing additional oversight in the chain of custody. Product protection through
specialized packaging and information technology components, including temperature sensors, monitors, and auto-identification
tools, should be introduced to ensure that delicate life-saving compounds are not compromised on the path from production
to patient. Standards, policies, procedures, and processes to safeguard the security of the supply chain should be agreed
to by all participants (no matter how small their role) and should be reinforced by clearly defined service level agreements
and reporting mechanisms. With all company participants focused on the same goal of delivering a better quality of life to
patients, true supply-chain transformation is possible.
CARLA REED is a principal at Tunnell Consulting, Inc., tel. 610.337.0820, reedc@tunnellconsulting.com
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