Guest Column

RFID fights counterfeit menace

RFID is an effective tool to tackle the problem of counterfeiting prevalent in the pharma industry today. Ravi Mathur presents his views on the issue

Counterfeit drugs are a huge problem not only for our society but also for the Pharma industry globally. It most importantly affects the brand equity of India in global markets as a major exporter and manufacturer of Pharma drugs and other medical products. The annual cost of counterfeiting to the pharmaceutical industry is $68 billion.

Electronic Product Code (EPC) or Radio Frequency Identification (RFID) is the best medicine against counterfeit drugs and item level tagging, which can help eliminate this problem.

EPC is an innovation, an outcome of extensive research undertaken by the Auto-ID Center, Massachusetts Institute of Technology (MIT), Boston, which was funded and sponsored by the USFDA, Baxter, Reckitt Benckiser, Abbott Labs, Pfizer, Johnson & Johnson, amongst 100 other leading companies across industry segments.

EPC based RFID technology uses RFID tags affixed on cases and consignments and a serialised Electronic Product Code for identification, detection and subsequent segregation of genuine and counterfeit pharma drugs and medical supplies globally. This would obviously benefit all stakeholders—pharma manufacturers, health regulators and pharma distribution supply chain including chemists, druggists, stockists most importantly, consumers.

RFID tracking, in general, could help improve the integrity of the supply chain. Companies can maintain much tighter control over legitimate shipments by clearly identifying and tracking products, cartons and pellets, and ensure that they aren't hijacked or stolen. This can prevent products from falling into the hands of counterfeiters, who could dilute or alter the drugs and then foist them on unsuspecting pharmacies and consumers.

Much of the effort centers on 'authentication' and 'track and trace' technologies. “The appeal of RFID and EPC technology is the ability to uniquely identify individual products throughout the supply chain and create seamless visibility,” says Lisa Clowers, Vice President of Supply Chain Processes & Technology at the Healthcare Distribution Management Association (HDMA), Reston, Virginia. It is a non-profit organisation, set up in US to secure safe and effective distribution of healthcare products.

Counterfeit detection and efficient expiration management of pharma drugs and medical supplies through deployment EPC based RFID technology facilitates higher quality patient care world-wide. This technology also has possibilities of being deployed in a big way in India by virtue of its applications in detection of counterfeit merchandise, asset tracking, and traceability across national and global supply chains, product recall, arresting of pilferages and shrinkages, enhanced supply chain efficiencies, wastage control in supply chains.

The FDA Policy

The organisation that is responsible for regulating pharmaceutical safety in the USFDA. Since the US is such a huge pharmaceutical market, FDA policy has a world-wide effect on manufacturers. The story of the French RFID tags on Viagra therefore begins with a 1988 set of FDA regulations enacted, following the passage of the Prescription Drug Marketing Act (PDMA) of 1987. In 1987 the Prescription Drug Marketing Act (PDMA) was written to address the problems of drug counterfeiting in the pharmaceutical supply chain. Pharmaceuticals pass through many different points in the distribution chain from the factory to the local pharmacist. This leaves the system vulnerable to the introduction of counterfeit drugs. For this reason, the PDMA requires verification of the source of pharmaceutical shipments. The method of accounting for where a pharmaceutical comes from and verifying it to be legitimate is called the 'chain of custody'. It has been largely paper-based for many years.

The FDA has been investigating the use of information technology to make the chain of custody less labor-intensive and more secure. They issued a report in February 2004 that discussed various ways of automating the chain-of-custody 'pedigree' of a drug. This report, Combating Counterfeit Drugs - A Report of The Food and Drug Administration, was the first to propose the use of RFID tags to create a secure “e-pedigree” that could be physically tied to each pharmaceutical unit of sale (box, bottle, blister pack, case, or pallet).

Pfizer and TAGSYS are implementing RFID technology to protect the pharmaceutical supply chain from counterfeit and black-market drugs. The launch product for the technology is Pfizer's much-counterfeited Viagra. Other manufacturers like GlaxoSmithKline and Purdue Pharma have also announced plans to tag their products. Within India, Ranbaxy has become the first company to affix EPC/RFID tags in response to Wal-Mart directive effective from 1st January 2005.

Optimising the Supply Chain has also been one of the biggest challenges of the Healthcare sector. It globally loses $ two billion due to overstock and expiry. RFID helps in optimising supply chain which would enable to achieve 30 percent stock reduction, 30 percent increase in value added time and seven percent reduction in supply chain costs. It also helps in FIFO management, recalls of expired drugs, real-time tracking of expensive and critical instruments, restrict the access of drugs to authorized staff, accurate matching of test specimens to the patients, reduction in medical errors.

Another very big concern area for this sector is medical errors. (Approx) 75,000 patients die in USA alone each year from medical errors which is caused by patient misidentification or medication misidentification. This can be eliminated altogether by the use of RFID tags which can be placed on test specimens & accurately linked to a patient's records. The Role of EPCglobal India: EPCglobal India, a division of GS1 India, is a regional Member Organisation of EPCglobal, the not-for-profit organisation set up to establish global standards regarding the development, implementation and adoption of Electronic Product Code (EPC) and Radio Frequency Identification (RFID) technology and support of the EPCglobal Network.

The Author is the CEO GS1 India. GS1 India has been set up as a not-for-profit Organisation in 1996 under the Ministry of Commerce, Government of India and represents a joint Industry-Government collaborative initiative at bringing global best practices & standards for enhancing efficiency in Supply Chain Management into India