Issues

GPhA Position

U.S. consumers currently benefit from of the world’s most secure prescription drug supply chain. The Food and Drug Administration (FDA) and the U.S. pharmaceutical industry are exceptionally vigilant against the distribution and sale of counterfeit and adulterated medicines. Filling over 69% of the prescriptions in the U.S., the generic pharmaceutical industry is heavily vested in ensuring the security of the U.S. drug supply. GPhA believes that the problem of counterfeit medicines raises a very significant public health concern that must be addressed systemically on a range of levels—from local to global, and throughout the drug supply chain.

Low cost generic drugs are rarely if ever targeted by counterfeiters, who rather focus on more profitable and expensive brand-name products. Nonetheless, while the generic industry supports numerous anti-counterfeiting efforts, some anti-counterfeit efforts would require implementation of unique serialization of each unit of sale (e.g., bottle of pills) and electronic "track and trace" capabilities that would be both prohibitively expensive and unnecessary for low cost generic drugs. Indeed, as FDA recently acknowledged "counterfeiting is quite rare within the U.S. drug distribution system," and GPhA knows of no instance of a counterfeit generic product occurring in the normal chain of distribution. In general, about 1-2% of drugs are targeted by counterfeiters. Imposing such broad measures as serialization of all products and the creation of an electronic track and trace pedigree system would raise costs considerably for generic medicines. Thus, GPhA encourages the review of such proposals and urges regulatory authorities to make precise determinations of where the vulnerabilities are in the supply chain so that strategies may better address actual vulnerabilities, as opposed to formulating broad overreaching measures to overcome perceived vulnerabilities.

GPhA remains committed to working with state and federal lawmakers to ensure that future pedigree laws will best serve consumer interests by being practical, focused, and uniform across the country to preclude the unintended consequence of erecting cost barriers to the distribution of affordable, safe and legal generic medicines.

Key Points

Background

In 1988 Congress passed the Prescription Drug Marketing Act (PDMA) which required pedigree to be provided when drugs passed outside of the "normal chain of distribution" (i.e., manufacturer to authorized distributor to pharmacy). Congress found that pedigree was necessary in such instances because "most of the drugs that were counterfeits, stolen, expired, or obtained through fraud were handled by secondary wholesalers, who were not authorized to distribute that manufacturer's product." Manufacturers and their authorized distributors were exempted from these requirements, as clearly the introduction of counterfeit medicines into the supply chain would rarely if ever occur in this link of the supply chain. However, these requirements were stayed by FDA and finally enjoined in 2006 by a federal district court in New York in large part because the passing of pedigree information had not been mandated, making the requirements potentially too difficult or impossible to fulfill.

In the last Congress, legislation was introduced by Reps. Stephen Buyer (R-Ind.) and Jim Matheson (D-Utah) that would urge the establishment of national standards for an electronic tracking system. The bill garnered some support because it called for a single uniform national pedigree standard, as opposed to a patchwork of differing state-by-state laws. However, the bill would ultimately require serialization of all products, even for low cost generics that would be at little or no risk of being counterfeited. Other federal legislative proposals included Rep. Dan Burton’s (R-IN) Reducing Fraudulent and Imitation Drugs Act, which called for Radio Frequency Identification (RFID) tracking of all prescription drugs, both brand and generic. Such a system is currently years away from being feasible.

On the state level, about half of the states have supported a "normal chain of distribution" model for pedigree, which reflects the same principles that Congress supported when it passed the PDMA. In contrast, California has passed a law requiring serialization of all products at the unit level and implementation of an interoperable electronic track and trace system. The law includes language providing for preemption of California requirements in the event federal legislation is enacted. The bill is "technology neutral," meaning it gives manufacturers to flexibility to use the most cost-effective track and track technology for their products. And the law extended the implementation date to 2015, so that brand and generic drug manufacturers would not face the impossible task of implementing an electronic track and trace pedigree system in time to reach compliance by the former deadline of 2009.