Counterfeit Drug Reporting: FDA Focuses On Numbers, Industry Worries About Process

FDA revises estimate of annual drug counterfeit reports from 5,000 to 1,000; PhRMA wants manufacturers to play consulting role, while wholesale distributors say trading partner who discovered problem should provide sole notice.

At the urging of a trade association, FDA has revised the number of annual drug counterfeit notifications it expects to receive from 5,000 to 1,000.

FDA included the original figure in a June 2014 Federal Register notice announcing the availability of a draft guidance implementing the Drug Supply Chain Security Act (DSCSA). The guidance includes tips and scenarios to help trading partners identify a suspect product and prevent it from entering the supply chain (Also see "FDA Setting “Vigilance” Standards For Track And Track Process" - Pink Sheet, 10 Jun, 2014.).

The DSCSA requires trading partners – manufacturers, repackagers, wholesale distributors and dispensers – to notify FDA and all immediate trading partners that they have reason to believe they may have received an illegitimate product. The notification provision became effective Jan. 1.

In a Sept. 15 Federal Register notice, FDA responded to comments on the draft guidance it received from 20 different organizations, companies and individuals. The agency highlighted its lower estimate of counterfeit reports. However, industry primarily voiced concern about the notification process.

The Healthcare Distribution Management Association, which represents primary wholesale distributors, mentioned in its comments that FDA’s estimates of expected annual notifications may be high.

“As wholesale distributors report receiving typically two or three alerts a year through the Counterfeit Alert Network, 5,000 notifications appears to be overly generous and we similarly believe it unlikely that wholesale distributors would need to file 2,500 illegitimate product reports to the agency in a single year,” the group said.

Should Trading Partners Submit Separate Notices?

However, HDMA primarily sought clarification on the notification provisions.

“To avoid multiple notifications which could number in the hundreds or thousands for a single illegitimate product event – we especially urge FDA to specify that only the trading partner that made the determination that a product is illegitimate has the duty to make the illegitimate product notification to the agency,” HDMA stated.

FDA said commenters had requested clarification about whether every trading partner should submit a separate notification to FDA about the same illegitimate product. The agency punted on this question, citing DSCSA provisions that require trading partners with illegitimate product in their possession or control to submit a notification.

The Pharmaceutical Research and Manufacturers of America asked FDA to strongly encourage trading partners to consult with the manufacturer before concluding a product is suspect or illegitimate. The Biotechnology Industry Organization also said the manufacturer should be consulted early in the process of identifying potentially suspect product.

The agency did not address this directly but noted that commenters had requested a field to indicate that the company making the notification has consulted with the manufacturer when determining if a product is illegitimate. FDA said the statute requires wholesale drug distributers, dispensers and repackagers to coordinate with the manufacturer when making such a determination and noted that there is a field on form FDA 3911 where the company making the notification can identify the manufacturer.

PhRMA also asked the agency to revise its recommendations as to how trading partners might identify suspect product. It advised FDA to emphasize that the product characteristics FDA included in its list of strategies to identify suspect product, such as a broken seal, are unlikely to be suggestive of a suspect product without being accompanied by other factors.

In addition, the association said FDA should respond to a request for termination of a notification in a shorter period of time than the 10 business days specified in the draft guidance.

Companies Can Use Existing Systems To Evaluate Products

FDA noted that several commenters had indicated that the 10-day timeframe for FDA to provide a consultation in response to a request for termination is too long and could result in drug shortages. The agency responded that it will review and consult with notifying parties regarding requests for termination “as soon as possible.” It said the timing will depend on the number of requests and the circumstances surrounding them.

As for who should initiate a termination, FDA said it believes that the trading partner making the notification should make the request since it knows if the illegitimate product in its possession or control has been satisfactorily dealt with. The agency said the guidance has been amended to clarify this point.

The Pharmaceutical Distribution Security Alliance, a coalition of manufacturers, repackagers, wholesale distributers, third-party logistics providers and pharmacies, criticized the specific scenarios FDA said could significantly increase the risk of a suspect product entering the pharmaceutical distribution supply chain. The group said many of the scenarios are overly broad and should be “narrowly tailored to prevent unnecessary concern and confusion in the distribution chain.”

For example, the guidance lists “purchasing from a source new to the trading partner.” PDSA said this typically should not increase the risk of a suspect product entering the distribution chain.

In addition, PDSA said trading partners should be given the flexibility to use existing systems and processes for identifying and evaluating suspect product on a case-by-case basis.

FDA said it agreed with this recommendation and that the final guidance will specify that trading partners “can use existing systems and processes to provide notification to trading partners that they believe may have received the illegitimate product or a product with high risk of illegitimacy.”

Manufacturers/Repackagers To Submit 80% Of Notifications

In addition to reducing the estimated number of counterfeit drug reports it expects to receive annually, the agency also revised its assumption as to which entities would be submitting the most notifications. It originally estimated that approximately 50% of the notifications will be made by manufacturers and repackagers, 45% by wholesaler distributors, and 5% by pharmacies.

Based on a comment it received and the fact that only manufacturers submit notifications of high risk of illegitimacy, FDA said it changed the proportion of notifications to be made by manufacturers and repackagers to 80% (800), and those to be made by wholesale distributers to 16% (160), and by pharmacies to 4% (40).

While the 800 figure represents the bulk of the reports, it represents a small portion of the approximately 6,500 manufacturers and repackagers registered in the FDA establishment and drug product listing database. The agency also estimates there are approximately 69,000 pharmacy sites in the US and that about 40 of them will provide notification an average of once per year.

Further, FDA said that because approximately 30 wholesale distributors are responsible for over 90% of drug distributions based on sales, and because FDA is estimating that over 2,200 small wholesale distributors might be responsible for the remaining 10% of drug sales, it estimates that distributors will be responsible for making an estimated 160 notifications.