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DRUG WHOLESALERS SHOULD QUARANTINE RETURNS UNTIL PRODUCTS ARE DESTROYED, FDA STATES IN PROPOSED GUIDELINES FOR STATE WHOLESALER LICENSING REQUIREMENTS

Executive Summary

Returned drug products should be quarantined by drug wholesalers until they can be destroyed or returned to the manufacturer, FDA asserts in proposed guidelines to help states set wholesaler licensing requirements. Published in the Sept. 13 Federal Register, the proposal stipulates that returned drugs "shall be quarantined and physically separated from other prescription drugs until they are destroyed or returned to their supplier." Such products include "drugs which are outdated, damaged, deteriorated, misbranded, or adulterated," the document states. The guidelines are required by the Prescription Drub Marketing Act, a.k.a. the Drug Diversion Act. The proposed guideline reflects FDA's earlier guidance letter regarding hospital returns. In the Aug. 1 letter, the agency advised that returns of prescriptioned drug products from hospitals and other nonprofit institutions will not be considered resales or trades, which are banned under the newly enacted drug diversion law, if the wholesaler who received the returned shipment either destroys the products or returns them to the manufacturer. FDA made no provision for the wholesaler's resale of the products back into distribution. Enacted on April 22, the diversion law requires the agency by Oct. 20 to publish final guidelines for state licensing of wholesale drug distributors. The legislation mandates that the guidelines "include minimum standards for storage, handling, and recordkeeping" of prescription drug products. Within two years after the guidelines are published, the law further prohibits all interstate distribution of prescription drugs by wholesalers not licensed by a state in accordance with the guidelines. Under FDA's proposal, damaged goods to be quarantined by wholesalers are identified as drugs "whose immediate or sealed outer or secondary containers have been opened or used outside the care, custody, or control of their supplier." The guidelines also stipulate that a product whose standards are in doubt should "be destroyed unless examination, testing or other investigation proves that it meets appropriate standards of safety, identity, quality, strength, and purity." One nonmanufacturer has made arrangements for actual testing of products in the wake of congressional concerns about drug diversion. The chain Revco contracted with an independent laboratory to test drug products purchased from unauthorized distributors. FDA said such doubts might be raised by "evidence arising from the circumstances of a return"; by "the conditions under which returned drugs have been held, stored, or shipped before or during their return; or" by "the condition of the drug or its container, carton, or labeling, as a result of shipping." The proposal's recordkeeping standards state that "wholesale drug distributors shall establish and maintain inventories and records of all transactions regarding the receipt and distribution or other disposition of prescription drugs." Records should include the name and address of the supplier and the address of the location from which the products were shipped, the identity and quantity of the products received and disposed of, expiration dates, and dates of receipt and disposition. Such records should be made available to law enforcement agency officials for "two years following the labeled expiration dates of the drugs," the document states. In the preamble to the regulation, FDA noted that its guidelines reflect model guidelines developed by the National Association of Boards of Pharmacy (NABP) and recommended by Congress. "In developing these guidelines, the agency has followed the recommendation of the House of Representatives' Committee on Energy 7 Commerce that it consider the Guidelines for the Inspection of Wholesalers issued by [NABP]," FDA said. The agency "also considered the Proposed Uniform Standards of Practice for Wholesale Drug Distribution" adopted by the National Wholesale Druggists Association board in November 1986, the preamble adds. "Written policies and procedures" should be kept by wholesalers to follow "for the receipt, storage, security, inventory, and distribution of drugs," the guidelines state. Established procedures should also be followed for the ready recall of each lot or batch of product. In addition, procedures should call for first-in, first-out inventory rotation, FDA said. Deviation from the such a rotation should be permitted only if it "is temporary, appropriate, and documented," the guideline states. Procedures should also provide for "reporting losses or thefts and for correcting all errors and inaccuracies in inventories." Storage standard include a provision that facilities have "sufficient space and environmental and security controls to assure that stored drugs do not become adulterated or stolen, and that damaged, adulterated, and misbranded drugs are segregated from other drug products." FDA said basic physical security measures should be present "to deter theft of drugs and the resulting diversion of stolen items." The guide also warns against the compromise of computerized inventory control systems and the alteration of electronic records to hide diversion. Storage standards also should emphasize maintenance of "appropriate temperature conditions" to avoid drug deterioration that can result from adverse (usually elevated) temperatures, the proposal states. Wholesalers should be required to examine in detail all ingoing and outgoing shipments "to prevent acceptance and distribution" of "contaminated or otherwise unfit" products. Under minimum requirements, the guidelines call for states to screen applicants for licenses carefully and deny applicants whose history suggests that doing so would reduce the potential for diversion. The preamble explains that states should "consider an applicant's past history, including any criminal violations, which may reflect upon the applicant's ability to prevent drug diversion. Where granting a license would not be in the public interest, state authorities may deny a license to an applicant." The preamble notes that the guide provides for "suspension or revocation of licenses, and permits fines, imprisonment, or civil penalties upon conviction of violations of federal, state, or local drug laws." The guidelines also establish minimum standards for personnel so that employees are qualified "by education or experience" to perform their duties.

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