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Global Tracking Regulations Present Challenges and Benefits

​​By Torben Vogt and Mari Serebrov

Drug makers are facing an ever-increasing challenge as more countries implement serial- ization and tracking regulations and set compliance deadlines in an effort to ensure the safety and quality of prescription drugs being sold within their borders. Complying with reg- ulations coming into effect will be a demanding task due to a lack of global harmonization.

The foundation of any tracking system is serialization, which entails affixing to finished drugs a unique serial number and barcode or radiofrequency identification (RFID) that can then be verified at the point of sale. But this basic step is fraught with complexities and variants. Some countries may require verification at each step of the supply chain; others may require it only when the drug passes to the end user. Most countries are requiring serialization at the unit level; this also is the case for California, discussed below. On the federal level, the US is considering starting with serialization at the lot level.

The numbering system a country chooses also adds to the challenges of compliance. For instance, countries such as Turkey and France are following GS1 standards, which include the Global Trade Item Number unique numbering scheme, while China is imposing its own numbering system.1 In addition to the serial number, most countries want a bar- code, either a two-dimensional (2D) matrix or a linear barcode.

A second level of tracking involves aggregation, which entails putting a separate number and barcode on each bundling of the product so scanning will show the individual serial numbers of all the units included in that bundle, shipper box or pallet. Some coun- tries do not require aggregation, others require it up to a certain level and still others expect it throughout the supply chain.

Another tracking requirement is an epedigree, an electronic document that moves through the supply chain with the drug, and records each sale, trade or purchase of the product. Currently, epedigrees are not required by the countries that have implemented a tracking system, but some, including the US, are proposing them. The level of detail and amount of data contained in an epedigree could vary greatly from country to country. An additional variant involves the point of origin for the document––whether it starts with the finished product or the active pharmaceutical ingredients (APIs). Regardless of which tracking elements a national scheme requires, a database is needed to tie them all together and to enable speedy verification of product authenticity at the point of sale. Different models are on the table, and many look to the well-functioning Turkish model, which has been operating for more than two years.

Country Regulations, Deadlines

Several countries, including China and the US, have been working on a tracking system for years, but Turkey took the lead in 2009 as the first to mandate serialization at the unit level. The Turkish Ministry of Health (MOH) regulations require serializing and tracking, based on unique serial numbers and 2D data matrix barcodes, for all packs and all aggre- gated levels (i.e., bundles, shipper boxes and pallets) reimbursed by the government. The regulations extend to promotional samples, hospital packaged products, prescription drugs and over-the-counter drugs.

Every entity in the Turkish supply chain – from the manufacturer to the wholesaler to the pharmacy – is required to send electronic serial number records to the national data- base in order for the product to pass to the next step of the supply chain and, eventually, for the pharmacy to obtain reimbursement from the MOH.

China has had requirements for serialization and aggregation since 2008. A short list of essential drugs (EDL) must be marked with a unique serial number and a machine- readable linear barcode on the carton. In contrast to other markets, valid serial numbers for the Chinese market are issued by China’s Food and Drug Administration. In addition, aggregation of serial numbers and barcodes is required up to the shipper box level. The EDL has gradually been expanded and will, from 2015, include all pharmaceutical prod- ucts sold in China.

A little further out is the implementation of the European Medicines Association’s Falsified Medicines Directive (FMD). That directive, which will be adopted in the laws of the Member States, requires all drugs sold in the European Union (EU) to be serialized by 2017. The regulations to implement the directive are expected to be issued late this year or early in 2014 as delegated acts.

The directive calls for serial numbers and 2D data matrix barcodes on individual packs of prescription drugs and other medicines at risk of being falsified. While it stops short of serialization for APIs, the directive does require APIs imported into the European Union, as of 2 July 2013, to be accompanied by written confirmation from the Competent Authority of the exporting country. The statements, to be issued for each manufacturing site and API, ensure that the product was made in accordance with manufacturing, inspec- tion and enforcement standards equivalent to those in the EU. Substances produced in non-EU countries with a regulatory framework deemed equivalent to that of the EU do not need the written confirmation.2

As the EU has yet to implement serial numbers and associated 2D barcodes,, several Member States have proceeded with their own codification systems, which vary greatly. In 2005, Italy became one of the first EU members to implement a barcode-based system. Its “Bollini” label features an Italian product license number with a sequential number. Belgium requires a sequential code that includes four different elements, and in France, the CIP13 requires printing a 2D data matrix containing product number, batch number and expiry date.

Meanwhile, securPharm, a consortium of pharmaceutical trade associations in Germany, is conducting a pilot program to give the EU directive a test run. The pilot involves manufacturers, wholesalers and retail pharmacies that will test an end-to-end authentication system using 2D barcodes. While it builds on an earlier pilot conducted by the European Federation of Pharmaceutical Industries and Associations, the new project includes two databases instead of one centralized database. Manufacturers will store serial data on one database; pharmacies will use the other when they run authentication checks. The goal is a harmonized, EU-wide system.3

With the same goal in mind, a partnership of organizations involved in the EU phar- maceutical supply chain developed the European Stakeholder Model, which entails a 2D barcode system containing the product number, batch number, expiry date and serial number. Using this model, the manufacturer would submit the serial numbers of the shipped product packs to a national repository that would be checked by the pharmacist to validate a code when the drug is dispensed to a patient.4

While the US has yet to enact national pharmaceutical tracking legislation, several states have passed statewide tracking regulations. California’s requirements, which require unit-level tracking and electronic pedigrees, are set to go into effect on a stag- gered basis from 2015 through 2017, but they are likely to be pre-empted by legislation proposed in Congress that would require serialization at the lot level with a later transition to unit-level tracking.5

Preparing for Serialization

Acquiring the necessary equipment and setting up a secure infrastructure to handle mul- tiple sets of regulations is a big investment. Multinational companies will need to build flexible IT systems with codification templates for each market. Any system must be able to capture the information necessary to connect individual serial numbers, in keeping with each market scheme, to the drug unit and then submit that serial number to the appropri- ate country database so it can be verified at the point of sale.

In addition to the IT system, companies may have to install new cameras, printers and other equipment on their packaging lines so serial numbers and barcodes can be properly placed on the product. Companies already have to run batches of drugs with dif- ferent labels for each market. As more tracking regulations go into effect, they will have to ensure that the correct serialization for each market matches the labeling.

Most companies are contracting with external consultants to advise on the evolv- ing regulatory requirements and to help develop a secure system that will ensure global compliance.

Putting such a system together is likely to take more time than drug makers or regu- lators expect. Since everyone is trying to become compliant before the deadlines, the demand for consultants and equipment is outpacing the supply. The resulting bottleneck has created lead times of up to a year on selected equipment orders. It is likely to get worse as China’s deadline approaches. If companies do not want to be stuck in a queue in 2015, they need to get their consultants on board and equipment ordered as quickly as possible.

Drug makers that rely on contract manufacturers should make sure all their contrac- tors already are working toward compliance with the various tracking requirements that are coming into effect. Even though the tracking systems will have to be installed at the manufacturer’s facility, the Marketing Authorisation Holder, which most often is the actual drug maker, will be the one held accountable for compliance. If drugs are not properly seri- alized when a country’s deadline rolls around, they will likely not be allowed in that market.

Multiple Benefits

Over time, drug makers should realize a number of benefits from serialization. By ensuring that the correct drug gets to the patient, a good tracking system will reduce a company’s liability. It also will cut down on the volume of counterfeit and fake drugs on the market.

While counterfeit and spurious drugs are a global health issue, the incidence varies by market and disease type. For instance, more than a third of malaria drugs available in Sub-Saharan Africa and Southeast Asia are thought to be counterfeit or substandard, according to the US Food and Drug Administration (FDA).6 However, the World Health Organization (WHO) has found the incidence of counterfeit medicines is low – less than 1% of market value – in most industrialized countries with strong regulatory systems and market controls.7

Given the price of drugs in industrialized nations, the problem is likely to grow if precautions are not taken. Counterfeit Avastin, which lacked the active ingredient of the cancer medication, was used in at least 19 medical practices in the US in 2012 and early 2013. A year earlier, UK officials seized Truvada and Viread, HIV/AIDS drugs, which had been diverted and were being sold in falsified packaging. The WHO also found that, in more than half the cases of pharmaceuticals purchased over the Internet from illegal sites, the medicines were counterfeit.8 If the fake drugs were removed from the market, drug makers would inevitably see some of this revenue return to their books.

Serialization at the unit level, coupled with aggregation, will make a company’s sup- ply chain more effective and improve its overall logistics. The tracking system will provide data on where a specific product is located at each time point. Such capabilities can enhance supply chain planning and enable leaner operations.

Another benefit of unit-level serialization is the ability to conduct a more targeted recall. Instead of having to recall entire lots when something goes wrong, a company could surgically recall only the problematic packs.

Drug makers willing to go beyond the serialization requirements could realize addi- tional benefits by embedding more data in their barcodes. For instance, a barcode could contain useful patient information that could be read using a smart phone app. A com- pany also could improve its pharmacovigilance by building a link to an adverse event form into the barcode. While serialization generally will not be required for investigational drugs used in clinical trials, sponsors may find it a useful tool for tracking the treatment of individual patients in a large trial. Other innovative uses, both for regulators and industry, are sure to surface as the technology advances and people become more comfortable with its capabilities.


Torben Vogt is the global serialisation practice lead at NNIT, responsible for driving the development of NNIT’s Serialisation and Trace & Trace services. Vogt started his career in the life sciences industry with a 14-year stint with the Novo Nordisk Bioindustrial Group. He then joined Actavis Inc. as vice president of IT. Mari Serebrov is an award-winning journalist who has cov- ered regulatory affairs for nearly three decades. She is the author of the BioWorld Data report, The Biosimilars Game: A Scorecard for Opportunities, Threats and Critical Strategies.


  1. GTIN (Global Trade Item Number). GS1 website. Accessed 12 July 2013.
  2. “Falsified medicines directive: imported active substances need written confirmation to guarantee GMP standards.” 2 July 2013. European Medicines Agency website. news/2013/07/news_detail_001840.jsp&mid=WC0b01ac058004d5c1. Accessed 7 July 2013.
  3. securPharm – the German shield against counterfeit medicines. securPharm website. tional-sites/english.html. Accessed 13 July 2013.
  4. About us. European Stakeholder Model website. Accessed 13 July 2013.
  5. California’s E-Pedigree Law. California Board of Pharmacy website. shtml. Accessed 13 July 2013. 
  6. “FDA Invention Fights Counterfeit Malaria Drugs.” 24 April 2013. Food and Drug Administration website. http://www.fda. gov/ForConsumers/ConsumerUpdates/ucm349110.htm. Accessed 7 July 2013.
  7. “Medicines: spurious/falsely-labelled/falsified/counterfeit (SFFC) medicines.” May 2012. World Health Organization website. Accessed 7 July 2013.
  8. Ibid.

© 2013 by the Regulatory Affairs Professionals Society. All rights reserved.







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