The pharmaceutical industry is increasingly falling victim to counterfeit medicines, reimbursement fraud and theft throughout the supply chain. These challenges and the potential risk to patient safety have led to the introduction of serialization requirements in many of the world’s major markets.

Complying with new track and trace requirements can be a complex and time consuming task. As pharmaceutical manufacturers take steps to prepare for new regulations in the U.S. and Europe, this article discusses the serialization challenge from a contract development and manufacturing organization (CDMO) perspective. It also explains what a pharmaceutical company should expect from its CDMO in the run-up to the regulatory changes.

The CDMO challenge
Counterfeit medicines are a profitable business with low risks, compared with supplying narcotics. A good example is counterfeit Viagra, which could earn a profit margin as high as 25,000 percent.¹

To ensure that security is maintained from the production and packaging of medicines to consumption by the patient, a CDMO must take responsibility for its link in the pharmaceutical supply chain.

From November 2017, all licensed drug products sold in the U.S. must be serialized to comply with the U.S. Drug Supply Chain Security Act. Similarly, from early 2019, the serialization of licensed drug products will be a legal requirement in Europe.

For many CDMOs, the challenge of ensuring a robust serialization process is enormous. Multiple production lines, in multiple locations, must be equipped with the software and hardware to perform serialization in line with varying regulations across the globe. Not only that, teams must be trained and individual client needs must be understood and met. For Recipharm, 85 percent of its production will require serialization. So, with looming deadlines on the horizon, how can a CDMO and its customers work together to face these challenges head on?

Understanding the requirements
While selecting the right serialization solution provider is important, the key is to understand the customer and market requirements. It is common for drug developers to operate across different markets, and so understanding the geographic complexities of track and trace regulations is key. While big pharma has a solid grasp of regulations, smaller and mid-sized companies may need to rely on their CDMO partner for advice to clarify the varying requirements.

Drug developers should also expect their CDMO to assist them with understanding their own unique needs. For example, how many products will they need to serialize and for which markets? Will they require randomized serial numbers to be generated by the CDMO? If not, will they generate serial numbers centrally and distribute them to the manufacturing plant?

It’s also important to agree to the fine details such as how does the pharmaceutical company plan to send its serial numbers and master data to the CDMO? Critically, how can each customer’s IT system link up with the CDMO’s to ensure the simple transfer of data? By mapping out all the requirements at an early stage in the process, the path towards compliance becomes clearer and potential obstacles can be addressed.

Potential hurdles
It is critical that you understand the potential hurdles you may come up against along your serialization journey. Only then can a plan to overcome them be formulated. As we see it, there are three potential hurdles linked to serialization.

First, the timing for serialization is critical. In fact, the European Stakeholder Model (ESM) suggests that four to five years is a realistic timeframe for implementation. It’s important to act now, or risk being left behind. Create a clear roadmap for serialization implementation across your sites, with a view to having production lines equipped and staff trained well ahead of the deadlines. This will allow time for any issues along the production line to be overcome before serialization becomes a legal requirement.

Secondly, cost is also a potential barrier for many drug developers, particularly smaller and mid-sized players. There are obvious financial implications of introducing new technologies and processes, however CDMOs should work with their customers to reduce the burden where possible. For example, spreading the cost of serialization across a supply agreement can be more manageable than a large upfront cost.

Thirdly, potential disruption is a major factor as production lines and operators adjust to new systems. In fact, evidence suggests that productivity or overall equipment effectiveness (OEE) can decline by as much as 10 percent when first introducing a serialization process. This further validates the need for production lines to be operational ahead of the legal requirements to eliminate any downtime issues in the early stages. Lower production levels could also be planned for in advance of the serialization process becoming operational.

What to expect from a CDMO partner
Given the importance of serialization regulations, drug developers should expect a certain level of knowledge from their contract manufacturing partner. The CDMO should have an understanding of geographic complexities and a plan in place to adapt to future track and trace regulations. Serialization regulations have been in place in Asian markets such as Turkey, Korea and China for a number of years and therefore a track record in dealing with similar requirements may be expected.

By establishing a dedicated taskforce, CDMOs can ensure that the necessary expertise exists within their organization. If a sufficient amount of attention is devoted to the challenge, the CDMO will be better positioned to add value to the serialization journey. It’s important that the project has senior buy-in within both the CDMO and the sponsor organization to ensure that serialization is a priority for both partners. A centrally coordinated project team should manage activities such as supplier evaluation, user requirement specifications (URS) and information system (IS)/ information technology (IT) issues, along with continuously monitoring legislative and technical developments in the area.

Of course, security of the serialized data is critical. Data flow, data management and storage are fundamental activities that the CDMO should have carefully considered. The design of the interfaces both internally—between systems at line-level, site and enterprise resource planning (ERP) level—and externally—how customers, governments or third parties will receive serial numbers—should also be mapped out. The CDMO must design its IS architecture to support this.

CDMOs should also offer a level of customization with their serialization offering. Given that contract service providers have a number of customer needs to meet, they must offer a solution that is adaptable to individual requirements. This may relate to printing techniques, anti-tampering strategies or the ability to handle serial numbers in different formats. While standard solutions can be applied to many customer requirements, flexibility is key.

Summary
Serialization is a complex area and the requirements are likely to develop and change over time. What is important now is that CDMOs work together with their customers to map out each of their unique requirements and assist in the journey to compliance. There is no time to be complacent as a poorly planned project could mean that pharmaceutical companies face disruption to their product supply and loss of sales. Those CDMOs that place serialization firmly on their agenda can find a competitive advantage in an increasingly crowded market. 

References

1. ‘Fat profits behind steady rise in fake drugs worldwide’, Deutsche Welle, September 30th, 2013.

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Staffan Widengren, director corporate projects, Recipharm, is program manager for the Recipharm global serialization project and part of a global steering committee that is working closely with clients globally to ensure they plan and implement changes that comply with pending regulatory requirements for drug serialization. Staffan has been working as quality director/qualified person and general manager within Recipharm since 2002 and in June 2015 began to head up Recipharm’s global serialization initiative. For more information about Recipharm and its services visit www.recipharm.com.