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By The APICS Interview | May/June 2012 | 23 | 3

APICS magazine | The APICS InterviewCreating a stronger pharmaceutical supply chain through unique packaging solutions

Editor’s note: Rick Seibert is vice president of business development at Sharp Corporation, a provider of contract packaging services to the pharmaceutical industry. Here he discusses with APICS magazine managing editor Elizabeth Rennie vulnerabilities in the prescription drug supply chain, serialization and track and trace, authentication, anti-counterfeiting, and other relevant topics for today’s prescription drug supply chain.

Rennie: Many countries have begun addressing vulnerabilities with new regulations that require the serialization (the act of placing a unique mark on each level of packaging) of drug products. What types of serialization initiatives have you worked on at Sharp Corporation?
Seibert: Currently there is no US or international standard that exists for the coding and configuration of serialized pharmaceutical products. Due to lack of shared standards, different countries, as well as companies with pharmaceutical market segments, have taken their own customized approach to meeting the perceived serialization solution. While the US solution has trended toward a pedigree model, international markets have migrated toward an authentication or point-of-sale verification model.

As Sharp Corporation is part of United Drug PLC, we have been engaged in development and deployment of both models. In fact, the absence of an international or domestic US standard for serialization has been both a challenge as well as a blessing for Sharp.

Why do you say it’s both a challenge and a blessing?
As a contract packaging services provider, we need to develop and deploy systems to support companies that produce and distribute products into all major international markets. The primary markets we serve are the United States/North America, Western Europe, South America, and Japan. We must also service a range of customer sophistication that varies from large pharmaceutical companies with serialized solutions supported by major [enterprise resources planning] (ERP) vendors, such as SAP and Oracle, to small, virtual companies that have no [information technology] or technical infrastructure whatsoever and that rely on Sharp infrastructure.

Our serialized solutions need to be compliant with international standards requirements as they evolve and must also have open architecture that enables collaboration and data sharing with various middleware and ERP packages deployed across a diverse customer base.

To date, we have implemented approximately 12 serialized packaging solutions for virtual companies through top-tier large pharmaceutical companies. We have not implemented a complete pedigree system that includes a comprehensive solution utilized by wholesalers or point-of-sale dispensation. These last two nodes of the US pharmaceutical supply chain have not yet embraced serialized solutions based on the lack of a national or US standard for serialized packaging solutions.

What are your packaging solutions used for primarily?
The solutions we have deployed [are] used as anti-diversion, anti-counterfeiting, and patient-assistance tools … At Sharp, we are aggressively working on solutions where we can offer a range additional services that extend beyond the immediate compliance and regulatory compliance requirements for serialization.

Can you explain the difference between current regulations and what your company aims to achieve?
The regulations are targeted toward authentication and anti-counterfeiting. Outside of the United States, specifically in Europe, the serialized packages provide a tool to limit parallel trade operations. Parallel trade occurs when a product that is produced to be sold into Market A with Market A pricing is sold in Market B at Market B pricing. In Europe, pricing is set by government agencies, which are the primary payers for the drug products. Parallel trade is legal, but disrupts the supply chain in that, oftentimes, products intended for sale in lower-priced markets are diverted and sold into higher-priced markets. This disrupts the supply chain and also the pricing and reimbursement models throughout the chain. Aside from detection of counterfeit products, a serialized product can also be detected at the point of sale.

At Sharp, we are passionate that a serial number will become a technology “thread” that will connect a patient or end user to an extended list of services that will support improved clinical outcomes in the near future. The same serial number thread will provide for additional value-added services for the brand owners and pharmaceutical companies and their extended supply chains, as well. Value-added services enabled by serialized pharmaceuticals include access to co-pay assistance programs, authentication, anti-counterfeiting, reimbursement services, compliance and adherence solutions, returns services, recall services, parallel trade detection and deterrence, patient and care provider education services, market analytics, contract management and compliance, et cetera.

What is the basic idea behind serialization—achieving a complete history through track and trace, or is it more than that?
I personally believe that the driving force behind the serialization movement is based on the need to verify that a packaged drug product is authentic and is therefore clinically safe for use by the patient. With this overarching objective in mind, a serialized package provides for additional visibility throughout the entire supply chain and creates opportunities for all members of the supply chain to gain some competitive advantage by exploiting the technology.

What types of challenges or unforeseen hurdles have you encountered when serializing drug product at a unit-of-sale level? Can you share some examples of issues you’ve faced and how you’re working to overcome them?
The two largest hurdles we’ve had to overcome are the impacts on the operations workforce and the exchange of data between our customers and our suppliers. In the serialized world, efforts to minimize human intervention must be considered. [When] packaging products at speeds up to 300 units per minute, caution must be taken to assure that a manual intervention does not cause any parent-child aggregation to be broken. Current practices dictate compliance at lot number and expiration date levels. Serialization changes the paradigm into a lot size of one, which is a culture-changing impact on operations employees. Line design, implementation, and employee training are crucial to the successful launch of serialized solutions.

With regard to data sharing, the lack of international standards becomes the main issue to address. Discussion and agreement on the data format, standards to deploy, database structure, reporting requirements, et cetera, need to be discussed and agreed upon as early as possible in the project life cycle.

Can you please share one or two lessons learned that you think would be valuable to APICS magazine readers?
It is easy to underestimate the complexity and challenges involved with developing and implementing a serialized solution for pharmaceutical products. There is no real substitute to executing an actual project from concept through commercialization. Many companies have taken a pilot approach, which is an excellent proxy to an actual commercial project. I would suggest that anyone taking on a pilot or commercial trial project should budget 12-to-15 months from concept through completion of the project. I would also suggest that anyone implementing a serialized solution find a partner with commercial experience with these technologies. Customized solutions, especially with regard to serial number management systems, add significant risk to the success of the project.

It’s not as easy as it may seem, so get some real-world experience and get to know what you don’t know. Pick your partners wisely, and don’t try to customize until you’ve mastered the basics. Don’t look at serialization as a compliance or regulatory burden; look at it as an opportunity or tool that can reinvent your supply chain. Use it … to add value to your brand, to connect with your patients and clinicians, and to integrate more closely with your supply chain partners.

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