Epedigree - Laws

Laws

ePedigree laws are in a rapid state of flux with states changing the "drop dead" date for compliance with tracking and authentication years beyond the original dates set by Florida and California. The definitive requirements will include serialization. Companies that focus purely on achieving compliance will miss the opportunity to use regulation as a business driver. The ability to track and serialize unit level saleable packages (e.g. bottle of 25 pills) not just cases or pallets can create business value in knowing exactly where their products are purchased can do the following: 1) Minimize cost of chargebacks through 100% accurate adjudication. Chargebacks account for 2-15% of gross revenue for a pharmaceutical manufacturer. 2) Minimize risk by increasing accuracy in Medicare/Medicaid pricing calculations by fully knowing all fees, rebates, and chargebacks that should be applied to a specific unit sale. Over $4B in fines have been handed down for improperly calculating Medicare/Medicaid pricing. 3) Limit liability of having to recall entire lots of product because a (non-serialized) shipment was stolen - see example: 4) Achieve visibility for manufacturers in the labyrinth that is the wholesale distribution network to more accurately forecast demand and measure sales & marketing programs.

Although simple epedigree systems are an important first step, significant improvement in public safety would result from a more standardized and automated approach. The larger and more difficult task of providing for an Automated Epedigree System has been suggested, but not required by any state. Such a system would require fairly significant changes to supply chain companies' data interchanges and would certainly require advanced Track and Trace technology (with bar codes or RFID). The requirements that come closest to an Automated Epedigree System have been proposed by California. In March 2008, the California Board of Pharmacy (CBOP) published its "E-Pedigree Requirements" which are scheduled to go into effect in a phased approach between 2015-2017. If the FDA establishes electronic pedigree regulations they would supersede California's. CBOP has proposed an XML standard document and the law requires an "interoperable electronic system".