GS1 Healthcare US HEALTHCARE SUPPLIER TOOL KIT. Global Trade Item Number (GTIN )

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1 GS1 Healthcare US HEALTHCARE SUPPLIER TOOL KIT Global Trade Item Number (GTIN ) Release 2.1 Aug Published: August 2015 All contents copyright 2015 GS1 US Page 1 of 53

2 Table of Contents EXECUTIVE SUMMARY... 4 ABOUT GS INTRODUCTION TO STANDARDS & THE HEALTHCARE SUPPLY CHAIN... 6 HOW STANDARDS HELP TO SOLVE SUPPLY CHAIN PROBLEMS... 6 HOW THE STANDARDS WORK TOGETHER... 7 HOW STANDARDS BENEFIT THE HEALTHCARE SUPPLY CHAIN... 9 ABOUT THE STANDARDS GLOBAL LOCATION NUMBER (GLN) GLOBAL TRADE ITEM NUMBER (GTIN ) GLOBAL DATA SYNCHRONIZATION NETWORK (GDSN ) UNITED NATIONS STANDARD PRODUCTS AND SERVICES CODE (UNSPSC ) THE CASE FOR THE GLOBAL TRADE ITEM NUMBER (GTIN ) THE PROBLEM: PRODUCT IDENTIFICATION THE SOLUTION: STANDARDIZED TRADE ITEM IDENTIFIERS WHAT IS A GTIN? HOW ARE GTINs ASSIGNED TO PRODUCTS? HOW IS A GTIN USED? IDENTIFICATION OF PRODUCTS LINK TO PRODUCT INFORMATION ADVANTAGES OF USING GTINs IN THE HEALTHCARE SUPPLY CHAIN BENEFITS TO HEALTHCARE SUPPLIERS SUPPLY CHAIN BENEFITS COMPETITIVE ADVANTAGES GTIN SUNRISE IMPLEMENTING GTINs IN YOUR COMPANY STEP ONE: ESTABLISH EXECUTIVE SUPPORT STEP TWO: FORM A GTIN MANAGEMENT ADVISORY GROUP STEP THREE: ESTABLISH YOUR GTIN OPERATIONAL TEAM STEP FOUR: DEVELOP & INITIATE PROJECT COMMUNICATION STEP FIVE: INITIATE EDUCATION FOR THE ADVISORY GROUP & OPERATIONAL TEAM STEP SIX: ASSESS INFORMATION SYSTEM ISSUES & MAKE NECESSARY CHANGES STEP SEVEN: IDENTIFY/ALLOCATE GTINS STEP EIGHT: ESTABLISH IMPLEMENTATION STRATEGY STEP NINE: ENGAGE CUSTOMER INVOLVEMENT STEP TEN: CONDUCT TRANSACTIONAL TESTING WITH CUSTOMERS STEP ELEVEN: MAKE ADJUSTMENTS TO INITIAL GTIN IMPLEMENTATION PLAN STEP TWELVE: CREATE STANDARD OPERATING PROCEDURES All contents copyright 2015 GS1 US Page 2 of 53

3 ANALYZING GTIN ROI FOR YOUR COMPANY BACKGROUND INFORMATION RE: ROI FROM GTIN USE IN OTHER INDUSTRIES HOT SPOTS FOR ROI Supply Chain Management Operational Efficiency Competitive Advantage LESSONS LEARNED & BEST PRACTICES FREQUENTLY ASKED QUESTIONS (FAQs) GLOSSARY REFERENCES APPENDIX A: GTIN DATA FORMATS APPENDIX B: INTEGRATION OF NDC/NHRIC INTO GTINs CREATING A 14-DIGIT GTIN CREATING A 12-DIGIT GTIN APPENDIX C: GS1 APPLICATION IDENTIFIERS APPENDIX D: ILLUSTRATIONS OF BAR CODED GTINs GS1 SYMBOLOGIES ENCODING GTIN GS1 SYMBOLOGIES ENCODING GTIN WITH SERIAL NUMBER GS1 SYMBOLOGIES ENCODING GTIN WITH LOT NUMBER GS1 SYMBOLOGIES ENCODING GTIN WITH EXPIRATION DATE GS1 SYMBOLOGIES ENCODING GTIN WITH SERIAL, LOT & EXPIRATION DATE APPENDIX E: DATA DRIVER APPENDIX F: ABOUT YOUR GS1 COMPANY PREFIX APPENDIX G: GENERIC 850 PURCHASE ORDER WITH GTIN & GLN APPENDIX H: GENERIC 856 ADVANCED SHIP NOTICE (ASN) WITH GTIN & GLN All contents copyright 2015 GS1 US Page 3 of 53

4 Executive Summary The purpose of this document is to provide guidance to healthcare suppliers about the need for standardized product identification in order to improve supply chain efficiency and patient safety, and to meet the U.S. healthcare industry 2012 GTIN Sunrise date. To that end, it introduces and explains the GS1 Global Trade Item Number (GTIN), and how it facilitates consistent product identification and accurate product information across all of your supply chains. In addition, the benefits to both supply chain management and competitive advantage are discussed, and guidance for assessing GTIN ROI for your company is included as well. Finally, this document provides detailed steps for implementing GTIN in your company. Using this document, you will better understand how the use of GTIN for product identification will best fulfill your need for accurate product information in order to support supply chain efficiency and customer satisfaction. And, using this document, you will learn how to get that effort underway today! This document is a companion to the Healthcare Provider Global Trade Item Number (GTIN) Tool Kit published July The use of both documents will increase understanding of all healthcare supply chain partners and facilitate a meaningful dialogue concerning implementation and benefits. GS1 Healthcare US would like to thank the members of thegs1 Healthcare US Product Identification Workgroup for their hard work and dedication in developing the first U.S. Healthcare Supplier Tool Kit for GS1 standards. All contents copyright 2015 GS1 US Page 4 of 53

5 About GS1 ABOUT G S1 GS1 is a neutral, not-for-profit, global organization that develops and maintains the most widely-used supply chain standards system in the world. GS1 Standards improve the efficiency, safety, and visibility of supply chains across multiple sectors. With local Member Organizations in over 110 countries, GS1 engages with communities of trading partners, industry organizations, governments, and technology providers to understand and respond to their business needs through the adoption and implementation of global standards. GS1 is driven by over a million user companies, which execute more than six billion transactions daily in 150 countries using GS1 Standards. ABOUT G S1 US GS1 US, a member of the global information standards organization GS1, brings industry communities together to solve supply-chain problems through the adoption and implementation of GS1 Standards. Nearly 300,000 businesses in 25 industries rely on GS1 US for trading-partner collaboration and for maximizing the cost effectiveness, speed, visibility, security and sustainability of their business processes. They achieve these benefits through solutions based on GS1 global unique numbering and identification systems, barcodes, Electronic Product Code (EPC )-enabled RFID, data synchronization, and electronic information exchange. GS1 US also manages the United Nations Standard Products and Services Code (UNSPSC ). ABOUT G S1 HEALTHC ARE GS1 Healthcare is a global, voluntary healthcare user group developing global standards for the healthcare supply chain and advancing global harmonization. GS1 Healthcare consists of participants from all stakeholders of the healthcare supply chain: manufacturers, wholesalers & distributors, as well as hospitals and pharmacy retailers. GS1 Healthcare also maintains close contacts with regulatory agencies and trade organizations worldwide. GS1 Healthcare drives the development of GS1 Standards and solutions to meet the needs of the global healthcare industry, and promotes the effective utilization and implementation of global standards in the healthcare industry through local support initiatives like GS1 Healthcare US in the United States. ABOUT G S1 HEALTHC ARE US GS1 Healthcare US is an industry group that focuses on driving the adoption and implementation of GS1 Standards in the healthcare industry in the United States to improve patient safety and supply chain efficiency. GS1 Healthcare US brings together members from all segments of the healthcare industry to address the supply chain issues that most impact healthcare in the United States. Facilitated by GS1 US, GS1 Healthcare US is one of over 30 local GS1 Healthcare user groups around the world that supports the adoption and implementation of global standards developed by GS1. All contents copyright 2015 GS1 US Page 5 of 53

6 Introduction to Standards & the Healthcare Supply Chain Suppliers in the healthcare industry use GS1 standards with their consumer goods retail customers and have experienced the many benefits of using one industry standard in the United States and globally. Healthcare suppliers, like suppliers in other industries, have found that using GS1 standards improves information quality and promotes efficient business processes. These improvements translate to significant real world benefits, including simplified supply chain management, reduced labor costs, more efficient payment and reporting processes, better cash flow, and increased customer satisfaction. As healthcare suppliers have been experiencing the benefits of using GS1 standards with their retail customers, a movement to adopt and implement data standards in the healthcare supply chain has been building across the healthcare industry. This movement has its roots in two revealing studies. First, the Efficient Healthcare Consumer Response (EHCR) study of 1996, the first comprehensive analysis of healthcare standards, found that $11 billion is wasted each year in the healthcare supply chain primarily because data standards are either entirely lacking or not as widely used or well-developed as in other industries. 1 Second, a groundbreaking report on patient safety issues by the Institute of Medicine in 1999 (and a follow-up report five years later) cited staggering statistics about medical error 2 and widespread systemic problems. 3 The problems highlighted in those studies have risen to the forefront of national attention today, and the momentum behind the movement to adopt and implement data standards in the healthcare supply chain is directly related to the fact that standards are essential for solving those problems. In response, a growing number of hospitals, healthcare suppliers and healthcare-related organizations have chosen the GS1 System of standards to help them improve supply chain efficiency and patient safety. For over thirty-five years, the GS1 System has provided globally accepted identifiers and a common language for the communication of supply chain information about products, services and locations in order to improve the accuracy, speed and efficiency of business processes. The GS1 System is the most widely used supply chain standards system in the world, utilized in twenty-three sectors and industries including GS1 s core sectors of Healthcare and Fast Moving Consumer Goods (FMCG), as well as Transport, Defense and many others. How Standards Help to Solve Supply Chain Problems Without standards, supply chain partners are left to develop their own identifiers and data formats, resulting in numerous proprietary standards for healthcare suppliers and providers to manage. The existence of numerous standards causes supply chain inefficiencies and inaccurate data that insert unnecessary cost and confusion into business processes. For healthcare, the absence and/or under-utilization of data standards has resulted in medical errors, widespread systemic problems and $11 billion wasted in the healthcare supply chain each year. Accurate product and location information is essential for all supply chains in order to support orders, invoices, deliveries, as well as customer service and marketing activities. Global standards provide a common language All contents copyright 2015 GS1 US Page 6 of 53

7 for that information that can be used by any supply chain partner, in any industry, in any location around the world. Global standards promote simplicity, consistency and accuracy in supply chain communications. In today s complex markets, supply chain lines are blurring and channels of distribution for various sectors are overlapping. This is especially true of the healthcare industry where manufacturers of healthcare products often supply both hospitals and consumer goods retailers in both the U.S. and across the globe; pharmacies and hospitals purchase consumer goods as well as healthcare products; and the pharmaceutical supply chain has expanded to include supermarkets and consumer goods retailers in addition to traditional pharmacies. Global standards are essential in this environment. How the Standards Work Together GS1 Identification Numbers provide the link between an object and the information pertaining to it. When users assign a GS1 Identification Number, they define a set of standardized information (known as attributes) about the object to which that identifier relates (e.g., size, weight, location) The GS1 System specifies the list of attributes that must be defined for each GS1 Identifier, and provides a precise definition as well as acceptable values and data formats for each attribute. Standardized attributes about products include core data like selling unit, item dimensions, and product classification. Once defined by the user, those attributes are then stored in a GDSN-certified Data Pool and shared with supply chain partners using the Global Data Synchronization Network (GDSN ). Through this process, GS1 Identification Numbers not only identify an object, but also provide a link to information about that object. This linkage is tremendously valuable. In fact, twenty-three industry sectors have used GS1 Global Trade Item Numbers (GTIN ), Global Location Number (GLN) and the GDSN as the foundation for a wide range of efficiency building solutions that have improved their operations and supported their business processes for decades. Likewise, with GTINs, GLNs and the GDSN, the healthcare supply chain can lay the foundation for a wide range of solutions to improve supply chain efficiency and patient safety across the healthcare industry. All contents copyright 2015 GS1 US Page 7 of 53

8 To illustrate this, Figure 1 uses the image of a house to represent the connection between the standards and how they support the healthcare supply chain. The roof of the house represents the ultimate goals: supply chain efficiency and patient safety. In order to raise that roof and achieve those goals, the healthcare supply chain needs a strong foundation and pillars of support. Figure 1: Building Patient Safety with GS1 standards The foundation is the basis on which the pillars and the entire house are built. To achieve supply chain efficiency and patient safety, the ultimate goals in our house example, the strongest foundation is built with global standards that can be used by all supply chain partners regardless of industry sector or location. GTIN (standardized product identification), GLN (standardized location identification), and GDSN (standardized product definitions) provide such a foundation by fostering consistency and accuracy in supply chain information. Pillars are built on the foundation to raise the house and support the roof. The pillars in Figure 1 represent the numerous and ever-evolving tools and applications that healthcare supply chains can use to improve supply chain management and patient safety. The foundation of global standards provides the basis for developing those tools. Of course, a house can be built on a lesser foundation, like proprietary standards implemented across an individual organization. Although such a house can still realize some improvements to safety and efficiency, only a house built on a strong foundation of global standards has the interoperability across all supply chain partners to maximize safety and efficiency. The tools and applications represented in the pillars of Figure 1 advance the goals of supply chain efficiency and patient safety by improving healthcare business processes. Automatic Data Capture (e.g., scanning a bar-coded GTIN on a bottle of medication or hospital room) replaces manual data entry, which reduces human error and expedites the process of recording information. e-commerce replaces paperwork with automated transactions that are more efficient and accurate. Electronic Record Management using standards for various types of information (e.g., medical devices, medication, etc.) ensure compatibility and interoperability with other systems, optimizing both the records and the systems. Asset and Equipment Tracking systems identify specific assets and locations so facilities know where those assets are when they need them (e.g., IV pumps, blood pressure monitors, wheel chairs, etc.). Traceability applications promote supply chain security by facilitating product recalls and reducing the risk of counterfeit goods. All contents copyright 2015 GS1 US Page 8 of 53

9 How Standards Benefit the Healthcare Supply Chain Global standards provide a common language for product and location information that can be used by any supply chain partner, in any industry, in any location around the world. Global standards support healthcare business processes and can bring many benefits to the healthcare industry, such as: Fewer medication errors through efficient automated identification: the right product for the right patient at the right time through the right route and in the right dose More effective product recalls Efficient traceability More time with patients, less time spent on manual documentation Cost reduction through increased supply chain efficiency Improved order and invoice processes More efficient receiving Reduced inventory Increased productivity in business processes Improved shelf management Improved service levels/fill rates Improved management of manufacturing/supply costs Elimination of the need for re-labeling with proprietary codes Supports regulatory compliance In the journey to improve supply chain efficiency and patient safety, global standards have a large role to play. This tool kit is intended to guide you on that journey so that you can start realizing these benefits today. Efficient Healthcare Consumer Response (EHCR), Improving the Efficiency of the Healthcare Supply Chain, November Produced by CSC Consulting, Inc. Copyright 1996, American Society for Healthcare Materials Management, Health Industry Business Communications Council, Health Industry Distributors Association, National Wholesale Druggists Association, and GS1 US (formerly the Uniform Code Council), jointly and severally. 2 To Err Is Human: Building a Safer Health System. Institute of Medicine (1999). The National Academies Press. 3 Lucian L. Leape, M.D., Donald M. Berwick, M.D., Five Years After To Err Is Human: What Have We Learned?, Journal of the American Medical Association, May 18, 2005, 293 (19): All contents copyright 2015 GS1 US Page 9 of 53

10 About the Standards The GS1 System is an integrated suite of global standards that provides for accurate identification and communication of information regarding products, assets, services and locations. Using GS1 Identification Numbers, companies and organizations around the world are able to globally and uniquely identify physical things like trade items, assets, logistic units and physical locations, as well as logical things like corporations or a service relationship between provider and recipient. When this powerful identification system is combined with the Global Data Synchronization Network (GDSN), the connection is made between these physical or logical things and the information the supply chain needs about them. Global Location Number (GLN) The Global Location Number (GLN) is the globally unique GS1 Identification Number for locations and supply chain partners. The GLN can be used to identify a functional entity (like a hospital pharmacy or accounting department), a physical entity (like a warehouse or hospital wing or even a nursing station), or a legal entity (like a health system corporation). The attributes defined for each GLN [e.g., name, address, location type (e.g., ship to, bill to, deliver to, etc.)] help users to ensure that each GLN is specific to one unique location within the world. Global Trade Item Number (GTIN ) The Global Trade Item Number (GTIN) is the globally unique GS1 Identification Number used to identify trade items (i.e., products and services that may be priced, ordered or invoiced at any point in the supply chain). GTINs are assigned by the brand owner of the product, and are used to identify products as they move through the global supply chain to the hospital or ultimate end user. The GTIN uniquely identifies a product at each packaging level (e.g., a blister of two aspirin tablets; a bottle of 100 aspirin tablets; etc.). Global Data Synchronization Network (GDSN ) Each user not only defines and maintains its own GLNs and GTINs with their associated attributes, but is also responsible for sharing this information with its supply chain partners. To support those efforts, the Global Data Synchronization Network (GDSN) provides an efficient and effective approach to (1) storing GS1 Identifiers with their associated attributes, (2) checking to make sure that the identifiers and attributes are properly defined and formatted, and (3) sharing that information with supply chain partners. The GDSN offers a continuous, automated approach to data management that ensures that supply chain information is identical among trading partners, increasing data accuracy and driving costs out of the supply chain. United Nations Standard Products and Services Code (UNSPSC ) The United Nations Standard Products and Services Code (UNSPSC) is a hierarchical set of product categories used by supply chain partners worldwide to classify their products and services. The UNSPSC provides a single, global classification system for all products and services in all industry sectors. Use of the UNSPSC enhances company-wide visibility of spending analysis, and promotes cost-effective procurement. As a result, the UNSPSC is used extensively around the world in electronic catalogs, search engines, procurement application systems and accounting systems. The United Nations Development Program (UNDP) and Dunn & Bradstreet (D&B) jointly created the UNSPSC in 1998 through the merger of the U. N. Common Coding System and D&B's Standard Products and Services Classification. GS1 US serves as the code manager for the UNSPSC. All contents copyright 2015 GS1 US Page 10 of 53

11 The Case for the Global Trade Item Number (GTIN ) The Problem: Product Identification There is currently no universally adopted product identification standard for all healthcare-related products. The absence of universal, standards-based product identification has led to serious problems in healthcare supply chains. For example: 60% of all invoices generated in the healthcare supply chain have errors and each invoice error costs $40 to $400 to reconcile. 1 The lack of standards for unit of measure combined with the lack of distinct identifiers for different product packaging levels causes confusion and ordering errors. For example, providers may receive twenty boxes of sterile pads when they actually meant to order twenty cases, or they may order fifty arm splints and receive 500 because splints are sold in units of ten. These issues are highly problematic for healthcare suppliers. With intense competitive forces, regulatory changes and increasingly sophisticated customers, one theme common to all healthcare suppliers is the ever-growing pressure to improve efficiency and enhance competitive advantage. 2 However, as the above examples illustrate, the absence of universal, standards-based product identification directly undermines that effort by driving up transaction costs and hindering customer satisfaction. In response, many healthcare participants (e.g., hospitals, manufacturers, distributors, etc.) began assigning their own proprietary numbers to products. Although that would have been complicated enough, the use of different identification numbers for the same product extends much further than healthcare manufacturers, distributors and providers. American healthcare suppliers often sell their products to countries around the world, each of whom may have their own product identification requirements. Moreover, in today s complex markets, supply chain lines are blurring and channels of distribution for various sectors are overlapping. For example, suppliers of healthcare products often supply both hospitals and consumer goods retailers, and manufacturers of healthcare products often manufacture non-healthcare related products as well. As a result, healthcare suppliers selling their products in other sectors face product identification requirements associated with those other sectors as well. The existence of numerous product identifiers for the same product has created its own problems. Maintaining all of the various numbers has become a nightmare, requiring suppliers to create and manage maps between all of the various product identification numbers in their systems. Moreover, it promotes islands of automation with territorial demarcations across product lines, geographical markets and/or channel of distribution (i.e., IT systems using different product identifiers and thereby inhibiting corporate-wide visibility and analytics). As all of this shows, the absence of globally accepted, standardized product identifiers has resulted in an error-prone, inefficient approach to product identification that undermines supply chain management and efficiency. 1 William L. Rosenfeld & John L. Stelzer, Data Synchronization in Healthcare: A Solvable Problem, Sterling Commerce, 2 GE Fanuc Automation. A Manager's Guide to Overall Equipment Effectiveness (OEE). Modern Machine Shop. April (Retrieved on September 17, 2008.) All contents copyright 2015 GS1 US Page 11 of 53

12 The Solution: Standardized Trade Item Identifiers The solution to these problems is standards-based product identifiers. The use of a globally accepted, standardized approach to identifiers provides a common language to facilitate the communication of product information among all supply chain partners, regardless of sector or geography. This supports the efficient exchange of accurate product information with supply chain partners to support orders, returns and recalls. Moreover, the use of standards-based identifiers enables a healthcare supplier to efficiently and effectively manage information about all of their various product lines. This facilitates the flow of accurate product information within the company/organization itself, and across the various systems the company/organization uses to manage their operations. The GS1 System provides globally accepted identifiers, standards and a common language for the communication of supply chain information. The GS1 Identifier for products is the Global Trade Item Number (GTIN ). For decades, this GS1 Identifier has facilitated the sharing and communication of product information among supply chain partners in twenty-three industry sectors in 150 countries across the globe. Moreover, it has provided the foundation for innovative improvements in supply chain management for many American industries, including the impressive and well-documented advances in the retail and grocery industries directly attributable to their adoption and implementation of GTINs in particular and the GS1 System in general. What is a GTIN? A Global Trade Item Number (GTIN) is the globally unique GS1 Identification Number used to identify trade items (i.e., products and services that may be priced, ordered or invoiced at any point in the supply chain). GTINs are used to identify individual trade item units (like a box of 15 Brand X tissues), as well as all of their different packaging configurations (like a carton of six boxes of Brand X tissues). GTINs are assigned by the brand owner or manufacturer of the product, and are used to identify products as they move through the global supply chain to the hospital or ultimate end user. In fact, GTINs are already being used across the healthcare sector today, from prescription drugs, to medical devices, to healthcare supplies. In today s complex markets, supply chain lines are blurring and channels of distribution for various sectors are overlapping. Global standards that can be used by all supply chain partners, independent of industry sector or location, are essential in this environment. This is especially true of the healthcare industry where manufacturers of healthcare products often supply both hospitals and consumer goods retailers; pharmacies and hospitals purchase consumer goods as well as healthcare products; and the pharmaceutical supply chain has expanded to include supermarkets and consumer goods retailers in addition to traditional pharmacies. GTIN is a standard that can be used by all supply chain partners, independent of industry sector or location. As a result, healthcare suppliers can use GTINs for all aspects of their business: they can use GTIN virtually anywhere in the world to identify their healthcare and non-healthcare related products to all of their healthcare and non-healthcare customers. All contents copyright 2015 GS1 US Page 12 of 53

13 How are GTINs Assigned to Products? The GTIN is a number a globally unique, standards-based, identification number for trade items. Manufacturers are responsible for generating GTINs for their products (known as allocation). The GS1 System provides clear, structured data standards and allocation rules that manufacturers follow when allocating GTINs in order to ensure that their GTINs are globally unique and in a consistent format. It should be noted that some healthcare products are assigned identification numbers for regulatory purposes. For example, pharmaceutical products are assigned a National Drug Code (NDC), and medical/surgical products are assigned a National Health Related Item Code (NHRIC). GS1 allocation rules give pharmaceutical and medical/surgical manufacturers the option of integrating these regulatory identifiers into their GTINs, and many manufacturers opt to do so. There are two basic steps for allocating a GTIN: (1) First, GS1 US assigns a GS1 Company Prefix to the manufacturer. The GS1 Company Prefix is part of the data structure for all GS1 Identifiers (e.g., GTIN, GLN, etc.) and provides the foundation for generating all of the GS1 Identification Numbers. (To determine if your company already has a GS1 Company Prefix, please call GS1 US at ) (2) Second, the manufacturer assigns/generates their own GTINs based on their GS1 Company Prefix and the GS1 standards and GTIN Allocation Rules. (A link to the GS1 allocation rules for the healthcare sector is provided in the References page of this document.) When a manufacturer allocates a GTIN, they also define a prescribed set of data about the product to which that GTIN relates. These product description attributes define master data that is consistent across all instances of the product (e.g., size; color; brand information; etc.). GS1 US provides an online tool, known as Data Driver, to support users in allocating GTINs and defining the associated attributes. The GTIN and its associated attributes are then saved in a database (like a GDSN-certified Data Pool) and shared among supply chain partners. The final step for the manufacturer is to mark all of their products with the applicable GTIN so that they can be properly identified as they move through the supply chain. In order to do this, manufacturers encode the GTIN into data carriers [i.e., bar codes and/or Radio Frequency Identification (RFID) tags], and then affix a data carrier to each product. Data Carriers provide symbolic representations of GTINs that facilitate automatic identification and data capture (e.g., the black bars and spaces on the bar code). In addition, most data carriers include a human readable version of the GTIN as well to facilitate manual data entry when necessary (e.g., the numbers below the black bars of the bar code). The graphic below provides an example of a bar coded GTIN. Figure 2: GTIN Bar Code The graphic shows a GTIN encoded in a GS1-128 bar code. Appendix D provides graphical illustrations of GTINs encoded into each of the GS1 bar codes. Manufacturers can not only encode a GTIN into data carriers, but they can also encode item specific information on the data carrier as well (e.g., expiration date; lot number; batch number; etc.). Encoding item specific attributes into data carriers enables manufacturers to communicate item specific information (in addition to a GTIN) wherever the data carrier is scanned. This can be especially important with healthcare-related products like prescription drugs where lot number and serial number may be required. All contents copyright 2015 GS1 US Page 13 of 53

14 ! This section is intended to provide some basic information about the processes involved in GTIN allocation. Further information about the topics touched on in this section can be found in the various appendices of this document, specifically: Appendix A: GTIN Data Formats Appendix B: Integration of NDC/NHRIC into GTINs Appendix C: GS1 Application Identifiers Appendix D: Illustrations of Bar Coded GTINs Appendix E: Data Driver Readers seeking more detailed information about how to create a GTIN should consult the GS1 US Product Catalog and GTIN Allocation Rules. (See the References section of this document for links.) How is a GTIN Used? As described above, GTINs are assigned by the manufacturer of a product. Once assigned, GTINs are used by supply chain partners to (1) identify products as they move through the supply chain, and (2) to provide a link to the information pertaining to a product. Both of these uses are equally important. Identification of Products Manufacturers mark their products with the applicable GTIN to support supply chain partners in accurately identifying products. Using a globally accepted, standardized product identifier supports supply chain partners in accurately identifying products as they move through the supply chain to the ultimate end user. Supply chain partners can enter GTINs into their computer systems either by manual data entry (i.e., typing) or automatically via the data carrier (i.e., bar code scanners or RFID readers). The option of entering a GTIN into an IT system automatically using data carriers (as opposed to typing it in) enables users to record a GTIN with as minimal manual intervention as possible, increasing both speed and accuracy. This promotes a safer and more secure supply chain, and can be especially useful for prescription drugs and recalls. Link to Product Information The GTIN not only identifies a specific trade item, but also provides the link to the information pertaining to it. This enables supply chain partners to simply reference a GTIN in supply chain communications, as opposed to manually entering all of the necessary product information. Using a GTIN to reference trade item information promotes efficiency, precision and accuracy in communicating and sharing product information. For this reason, a GTIN is required in many types of e-commerce transactions, and is commonly used on purchase orders, as well as delivery and payment documents. All contents copyright 2015 GS1 US Page 14 of 53

15 Advantages of Using GTINs in the Healthcare Supply Chain Standards-based numbering systems are essential for efficient and effective communication of product information in supply chains. The GTIN is a global standard that delivers trade item data in a consistent format and structure based on the globally accepted GS1 System. As such, GTINs provide suppliers with a method for product identification that is simple and able to be used by all of their customers. With GTIN, suppliers are able to implement one, comprehensive approach to product identification in all of their systems and for all of their supply chain needs. This is because GTIN is a global standard used in twenty-three industry sectors. Suppliers can use GTIN to identify all of their products in their customer-facing communications and systems, regardless of whether that customer is a provider, pharmacy or retail outlet. Advantages of using GTINs include: International: GTINs are a global standard that can be assigned and used anywhere across the globe. Unique: The GTIN can be used to uniquely identify healthcare trade items, including every packaging configuration of a product. Multi-sector: GTINs can be used by all business sectors, enabling a healthcare product, a grocery product, a retail product, and 99% of the items used in the healthcare sector to be identified with the same standardized identification number. This enables healthcare manufacturers to use GTINs in supply chain communications with all of their customers regardless of sector, making inventory systems, ordering systems and accounting systems compatible across different operational units. Automatic Data Capture: One of the key benefits of the GTIN is that it can be encoded in many automatic data capture technologies (such as bar codes or RFID tags). This supports automatic data capture using both current and emerging technologies. Automatic data capture enables users to enter a GTIN into an IT system with as minimal manual intervention as possible, increasing both speed and accuracy. Data Integrity: Use of the GTIN for product identification enables users to leverage the Global Data Synchronization Network (GDSN) for product information. The GDSN offers a continuous, automated approach to data management that ensures that product information is identical among supply chain partners, increasing data accuracy and driving costs out of the supply chain. GS1 provides a registry service (i.e., a search tool) that enables subscribers to look up the owner of a bar code. That service, available on the GS1 website, is known as GS1 GEPIR. With GS1 GEPIR, users simply enter the GTIN displayed with a bar code, and GEPIR will identify the owner of that bar code/gtin. (A link to GS1 GEPIR is provided in the References of this document.) All contents copyright 2015 GS1 US Page 15 of 53

16 Benefits to Healthcare Suppliers GTINs enable healthcare suppliers to efficiently and effectively manage information about all of their products using a unique, global standard for product identification. This facilitates communication of accurate product information among supply chain partners and within the supplier as well, improving supply chain management and efficiency. In addition, as more and more healthcare providers and group purchasing organizations (GPOs) implement GTIN as their product identification standard of choice, suppliers implementing GTIN will be able to realize the competitive advantages of aligning with your customer s standards and supporting their patient safety efforts. The use of GTINs should be a critical component of your global data alignment strategy. Supply Chain Benefits Use of the GTIN facilitates communication of accurate product information among supply chain partners. In addition, it enables healthcare suppliers to efficiently and effectively manage information about all of their products. This promotes more efficient business practices and helps to drive down supply chain costs. As a result, there are many supply chain benefits to using a GTIN: Simplified supply chain management: GTIN strengthens business communications among supply chain partners by accurately identifying specific products with specific numbers. This facilitates the global flow of healthcare trade items and associated information. Improved information quality: Using the GTIN as the link to product information improves information quality by ensuring that product information is identical among supply chain partners. This benefits both internal and external business processes. Reduced labor costs: Use of GTIN frees staff time by eliminating the need to build and maintain cross reference tables in order to keep track of multiple proprietary identification numbers. More efficient payment and reporting processes: With the use of GTINs, sales can be reported automatically and with fewer errors, improving Electronic Data Interchange (EDI) and ebusiness transactions. Better cash flow: Use of GTIN streamlines chargeback and rebate processing, reducing the amount of money sitting in unresolved sales accounts. Competitive Advantages Use of GTINs improves order accuracy and the processing of invoices and chargebacks, which improves customer satisfaction. In addition, there is growing momentum to adopt GTINs by healthcare providers and GPOs in order to support patient safety and supply chain efficiency. As a result, there are competitive advantages to be gained by suppliers using GTINs: Improved customer satisfaction: Using GTINs improves order and invoice accuracy, reducing ordering mistakes and invoice disputes. This ensures that the purchasing experience runs smoothly for healthcare providers, improving customer satisfaction. All contents copyright 2015 GS1 US Page 16 of 53

17 Rebates and chargebacks: Use of GTINs supports the proper application of rebates and chargebacks, and assists suppliers in targeting these incentives to their best customers. Alignment with and support of customer initiatives: Increasing numbers of healthcare providers are implementing GTINs to support patient safety and supply chain efficiency efforts. In this tightly competitive market, this can translate into competitive advantages and positive PR for healthcare suppliers moving quickly to align with these efforts ahead of the curve by implementing GTINs as well.! In addition to this kit for suppliers, GS1 Healthcare US has prepared a GTIN tool kit for healthcare providers as well. Because it describes the uses and benefits of GTIN for healthcare providers (i.e., your customers), the provider tool kit may be a good resources for suppliers developing their competitive advantages business case. (A link to the Healthcare Provider Tool Kits is provided in the References page of this document.) 2012 GTIN Sunrise To improve patient safety and supply chain efficiency, organizations and companies throughout the U.S. healthcare supply chain have announced their support to adopt GS1 standards by the industry-accepted sunrise dates of 2010 for the GS1 Global Location Number (GLN) to standardize location identification and 2012 for the GS1 Global Trade Item Number (GTIN) to standardize product identification. The 2012 GTIN Sunrise date (December 2012) established by the healthcare industry calls for the adoption of GTINs in lieu of custom product numbers. The benefits of such an adoption have been delineated throughout this Tool Kit. The GS1 Healthcare US Product Identification Workgroup has been and continues to clarify what this date means to the U.S. healthcare supply chain. Healthcare supply chain participants are working to meet the following GTIN criteria by December 2012: GTINs are assigned to healthcare products. GTINs are used in business transactions. GTINs are marked on appropriate packaging levels. GTINs are scanned at points-of-delivery to enhance clinical process. GTINs are used in product returns and recalls. GTINs are registered in a GS1 GDSN-certified Data Pool. More information on the 2010 GLN and 2012 GTIN Sunrise can be found at All contents copyright 2015 GS1 US Page 17 of 53

18 Implementing GTINs in Your Company GTIN implementation provides the essential foundation for larger initiatives aimed at improving efficiency (like GDSN, UNSPSC product classification, and contracting), as well as enhancing competitive advantage (like supporting patient safety and supply chain management initiatives in customer hospitals). There are four primary activities in the supplier implementation effort: Create a GTIN database. Integrate GTIN into information systems like invoicing, accounts receivable, rebates, etc. Ensure correct labeling of products to meet GS1 standards (i.e., bar code and/or EPC tags). Create and maintain Standard Operating Procedures. Within the U.S. healthcare supplier community, there is tremendous variation in terms of knowledge and use of the GS1 System. Some suppliers employ GTIN for their retail markets, but not yet for healthcare markets. Some use GTINs for both. Some have not yet used the GS1 System at all. Wherever your company is on the standards journey, procedures and processes should be reviewed, updated and refined.! These implementation steps have been written for manufacturers who are new to the process of assigning GTINs to their products. Nonetheless, the steps can still be utilized by companies more familiar with this effort. So, what exactly does it take to implement GTINs by a healthcare supplier? What are the steps and who is involved? This section answers these questions with detailed, step by step instructions for implementing GTINs. Standard Operating Procedures (SOPs) of several major manufacturers were consulted in the development of this section, and lessons learned and best practices gleaned from those SOPs have been integrated. The implementation steps delineated here involve critical areas such as establishing executive support, determining implementation strategy, forming cross-functional teams, creating internal and external communication strategies, initiating supplier and customer involvement, and establishing standard operating procedures. It should be noted that GTIN implementation is a process, and many of the steps will be taking place concurrently. For links to all of the Tools listed in the implementation steps, please refer to the References section of this document. All contents copyright 2015 GS1 US Page 18 of 53

19 Step One: Establish Executive Support The goals in this step are to inform and educate executive management on standards adoption and the need for industry-wide implementation, and to obtain executive approval to proceed with implementation. Many times this step is initiated in response to external pressures like a Dear Supplier letter from a major customer. As with any project that will impact the business processes of the organization, the support of senior management is critical. * As stated above these steps are written for the manufacturer who is just beginning to mark products with GTINs. A manufacturer that already has a GS1 Company Prefix may want to review these steps to ensure that their GTIN process aligns with current industry practices. To obtain GS1 Company Prefix, call GS1 US at Actions Prepare a presentation on the value of a proactive GTIN implementation plan. In your presentation: Determine the present state of the company in terms of readiness for GTIN implementation. Gather Dear supplier letters, GPO announcements, 2012 GTIN Sunrise information, and competitor s progress in this area as part of the intelligence gathering process to support the business case. Use the Standardization Stat! awareness video developed by the healthcare industry to increase awareness, at all organizational levels, of the need for standards adoption. Consult use cases such as the Seton Family of Hospitals / BD Success Story. Contact GS1 Healthcare US for standard presentation charts. Cite the benefits identified in these materials. Include language to speak to specific stakeholders as necessary (e.g., reinforce enhanced business benefits as GTIN use becomes more robust; speak to the trend to GS1 standards at providers and GPOs; etc). Tools GTIN presentation and industry use cases from the GS1 Healthcare US Online Document Library Product Identification folder Standardization Stat! industry awareness video from the GS1 Healthcare US Website GTIN announcements from the GS1 Healthcare US Document Library Industry Announcements folder 2012 GTIN Sunrise information Seton Family of Hospitals / BD Success Story Emphasize that customer needs, potential regulation and business processes should drive technology, and determining the best way to implement GTIN in the company or revising the current process requires examination of current business processes. Assess your competitors to determine if they already mark products using GTIN and other GS1 standards. In your presentation, emphasize the risk of losing contracts to those currently using GTIN and the opportunity for competitive advantage over those not. Deliver the GTIN presentation and implementation plan to senior management. Secure approval to initiate the project and form the needed teams (i.e., GTIN Management Advisory Group, and the GTIN Operational Team). Determine the costs associated with joining GS1 US, obtaining a Company Prefix, and implementing GTIN. In addition to this tool kit for suppliers, GS1 Healthcare US has prepared a GTIN tool kit for healthcare providers as well. Because it describes the uses and benefits of GTIN for healthcare providers (i.e., your customers), the provider tool kit may be a good resources for suppliers developing their competitive advantages business case. (A link to the Healthcare Provider Tool Kit is provided in the References page of this document.) All contents copyright 2015 GS1 US Page 19 of 53

20 Step Two: Form a GTIN Management Advisory Group The goal in this step is to establish an Advisory Group. Formation of a cross-functional Group including members outside of supply chain functions promotes buy-in, supports communication efforts, and ensures proper input from the areas most impacted by implementation. Actions Recruit and solicit commitments for participation. The Group should include: Tools Packaging Engineers Financial Controller Regulatory Teams Legal Counsel Supply Chain Distribution Accounts Payable Public Relations (internal) Information Systems (business & operational) Information Systems Implementation Analyst Group Purchasing Representative Primary Distributor Representative Marketing Customer-facing Teams (e.g., Call Center, Catalog, etc.) GTIN presentation materials (prepared in Step 1 above) Step Three: Establish Your GTIN Operational Team The goal in this step is to establish a GTIN Operational Team. The preliminary focus of this team is to access the company s current GTIN process, if any, and to develop an as-is model. Development of the to be model for the day-to-day utilization and maintenance of the GTIN as a support tool, as well as the path to reach this point, will require the involvement of multiple individuals. Depending on the size of the company and its product line, this team may consist of one individual or many, and may operate as part of a packaging division or as one person in a marketing/sales department. Actions Identify and select participants. Establish the role of each participant. Update job descriptions to reflect the new responsibilities of the team members, if needed. Provide education and training, if needed. Training, at a minimum, should include What is a GTIN and 2012 GTIN Sunrise information. Tools GTIN presentation materials (prepared in Step 1 above) GTIN announcements from the GS1 Healthcare US Document Library Industry Announcements folder 2012 GTIN Sunrise information GS1 Healthcare US Web Seminars Seton Family of Hospitals / BD Success Story All contents copyright 2015 GS1 US Page 20 of 53

21 Step Four: Develop & Initiate Project Communication The goal in this step is to inform your internal and external community. Utilize internal communication tools such as newsletters and intranet to introduce the concept of the GTIN to your company, and external communication tools like websites and corporate letters for your customers. The Advisory Group member from Public Relations should be enlisted in this effort. Actions Announce organizational commitment to GTIN internally using newsletters and other media. Announce commitment to implement GTIN externally to your customers. (Note that you can lift some of the rationale directly from this tool kit.) Tools GTIN presentation materials (prepared in Step 1 above) GTIN announcements from the GS1 Healthcare US Document Library Industry Announcements folder 2012 GTIN Sunrise information Step Five: Initiate Education for the Advisory Group & Operational Team The goal in this step is to educate company participants. A base level of knowledge about GTINs, GS1 Healthcare US and GS1 standards is necessary for all active participants. Actions Participate in GS1 US web seminars. Train staff including marketing, customer relations and sales. Train staff utilizing GTIN work teams, both free and fee based. GS1 Healthcare US Product Identification Workgroup Meets weekly, Monday, 10:00 AM ET. Must be a GS1 Healthcare US member to participate. Tools GTIN presentation materials (prepared in Step 1 above) GTIN announcements from the GS1 Healthcare US Document Library Industry Announcements folder 2012 GTIN Sunrise information GS1 Healthcare US Web Seminars All contents copyright 2015 GS1 US Page 21 of 53

22 Step Six: Assess Information System Issues & Make Necessary Changes The goal in this step is to evaluate the readiness of your information systems, and make the appropriate system changes required to accommodate the use of GTIN, and possibly other GS1 Application Identifiers like Lot, Expiry Date and Serial Number. The capability of your information system to contain and utilize GTIN numbers and other Application Identifiers must be assessed, and the necessary changes budgeted and programmed keeping in mind the 2012 GTIN Sunrise date. Actions Meet with your IS system experts (including different disciplines within the IS department), internal and external, to review implementation strategy and understand implications for your information systems including (at a minimum) supply, invoicing, accounts receivable, sales and returns. Establish a collaborative plan to make the necessary changes and prepare information systems. Develop a plan to populate your internal systems with GTINs. Develop a formal SOP to maintain systems. Step Seven: Identify/Allocate GTINs The goal in this step is to ensure that GTINs have been properly allocated for each of the products at every packaging level manufactured by or for your company. Your databases may already contain many GTINs; however, at this point you will need to ensure that they are correct and accurate. Therefore, this effort will encompass assessing the GTINs you may already have allocated for omissions or misassignments, and then determining if there are any additional GTINs that need to be allocated. This is a critical step as your customers will soon begin demanding this information for data integrity sub-routines in their receiving systems. At a minimum, there must be a standard process to assign GTINs to every product at every level of packaging. The most common mistake is assigning the same GTIN to different packaging levels, which leads to returns, lost sales and customer dissatisfaction. Therefore, the key here is to ensure that a different GTIN is assigned to every level of packaging. In order to support users in this effort, GS1 US provides an online tool, known as Data Driver, to new members as part of their membership benefits. Legacy members can obtain Data Driver by upgrading their membership to GS1 US Partner Connections. (See Appendix E for more information about Data Driver.) Actions Identify the level of depth (i.e., packaging level) that your GTIN numbering system will need to accommodate to support operations. Contact your customers to identify any other information that they may require in addition to the GTIN. Tools At the Heart of Healthcare Product ID Brochure GTIN Allocation Rules Data Driver (Appendix E) All contents copyright 2015 GS1 US Page 22 of 53

23 Step Eight: Establish Implementation Strategy The goal in this step is to establish data storage referencing GTIN. At this point, you are ready to establish a GTIN utilization strategy and corresponding data packaging level chart. The establishment of your organization s GTIN packaging level is a critical step in the implementation process. It is necessary to consider not only how business is currently conducted, but also future business processes and supply system possibilities. In order to do that, current and possible distribution and billing systems must be clearly understood. In addition, discussion of rebate and chargeback processes as they apply to your company is also critical, as is the discussion of when to join GDSN. The Group must decide which tables/databases in the company s IT systems that must contain GTINs. The question that must be asked is: where are proprietary numbers used today that can be replaced with GTINs? At a minimum, the Group should consider the tables/databases in the following IT systems: purchasing, replenishment, recall, ebusiness, rebates and chargebacks, classification [i.e., United Nations Standard Products and Services Code (UNSPSC)], inventory management, transportation, payer systems (e.g., Medicare), etc. A cross-reference between the old number and the GTIN is critical. This cross-reference table must be transmitted to your company s call center and to your customers. The easier it is for the customer to place this information in its master product file, the easier it will be for them to continue to order the product. Therefore, both soft and hard copies must be provided to customer, and inclusion of the cross-reference table as part of the sales catalog will ensure that customers can easily adopt the new numbering system. Actions Analyze your organization s current and future supply chain models and distribution systems. Consider organizational evolution (e.g., regional, national, global, GDSN). Each system should be surveyed as to GTIN use. Once the initial survey is finished, it is recommended that the survey findings be re-circulated to the Group for review and validation. After completion of the survey review and validation, the Group should meet to discuss the results and to identify the first areas/systems in which to implement GTINs based on customer demand, value added benefits, patient safety, or all of the above. Tools GS1 Healthcare US Web Seminars Seton Family of Hospitals / BD Success Story! Please give the following information to your technical team to support their work in this step: Depending on the data carrier used, GTINs can be represented as 8 digits, 12 digits, 13 digits, or 14 digits in length. In order to accommodate each variation, it is highly recommended that a GTIN always be represented in software applications as 14 digits by right justifying and zero filling to the left as appropriate. In order to preserve any leading zeros that may be present, it is also recommended that the GTIN field be represented in a database as a text field, not as a numeric field. This information should be provided to systems engineers as they prepare to integrate GTINs into IT systems. All contents copyright 2015 GS1 US Page 23 of 53

24 Step Nine: Engage Customer Involvement The goals in this step are to prepare customers and to identify partner(s) for testing. This is the most important step in this process. What do your customers want? Collaboration and communication with your customers is critical to implementation success. So, now that an implementation plan and initial database has been established, review recent use cases (e.g., Seton Family of Hospitals / BD Success Story) and engage strategic customers in a process of communication about your organizational plans. It is recommended that a trusted partner be selected first to align the initial implementation. Actions Dialogue and explain global GS1 standards implementation and process. Determine customer capabilities. Analyze impact to operations and staff. Step Ten: Conduct Transactional Testing With Customers The goal in this step is to successfully exchange purchase transactions with customers. At this point, you are ready to conduct transactional tests with your customers. The testing process will provide validation of information system capabilities and operational impact, and may include your MMIS, EDI transactions, contracts, etc. It is recommended that suppliers first perform this step with their top/key customers.! NOTE: Generic EDI transactions using both GTINs and GLNs are provided in Appendices G and H. Actions Document critical success factors. Make adjustments as identified. Communicate with community. Step Eleven: Make Adjustments to Initial GTIN Implementation Plan The goal in this step is to review the initial plan and make corrections based on work group experiences and lessons learned. As a result of the testing process, potential adjustments must be made to all aspects of the program, from internal processes through communications. Actions Adjust plan to achieve the most benefits, either in terms of supply chain management, operational efficiency, financial benefits, or all of the above. Tools Project Implementation Plans All contents copyright 2015 GS1 US Page 24 of 53

25 Step Twelve: Create Standard Operating Procedures The goals in this step are to document standard operating procedures that establish the necessary control, maintenance and support of GTIN and AIDC of products, and obtain sign off and funding, both internally and externally. Following testing and the implementation of the necessary adjustments, it is necessary to prepare standard operating procedures for internal and external staff. The Advisory Group and Operational Team should be heavily involved in this process.! Several manufacturer standard operating procedures were reviewed in the preparation of this document. The content differed depending on the market served by the supplier. Nonetheless, all shared the same mantra that the GS1 standards must be adhered to and a process to ensure on-going conformance is critical to customer satisfaction. The dangers of increasing production at the expense of bar code/epc quality must be emphasized. Increased output is counter-productive if products are returned or if fines are levied due to non-conformance to GS1 standards. Analyzing GTIN ROI for Your Company In today s dynamic healthcare environment of declining reimbursement and a reduced labor pool, healthcare suppliers expressed a need to establish a return on investment (ROI) for the use of GTIN. Indeed, demonstration of positive ROI for GTIN supports companies challenged daily by the allocation of scarce resources. This section provides guidance and a model to help each company determine their own return on investment based on their individual needs and circumstances. The model is provided as a starting point for any company wishing to pursue ROI analysis.! It is good to note that beyond the analysis provided in this section for the ROI of GTIN alone, additional benefits and ROI can be found in the implementation of GTIN as part of the implementation of the full GS1 System of standards, including Global Location Numbers (GLNs) and the Global Data Synchronization Network (GDSN). (For more information about GLNs and the GDSN, please refer to the Healthcare Supplier Tool Kits prepared on those topics by GS1 Healthcare US.) Moreover, most early adopter organizations have realized additional value in unanticipated areas like process improvement and infrastructure development. And, many have noted the value of a new business philosophy or way of doing business which places the company in an advantageous position to address some of the upcoming challenges anticipated in healthcare over the next few years. Background Information re: ROI from GTIN Use in Other Industries The implementation of standards-based product identification in other industries has been found tremendously valuable, as discussed and analyzed at length in the article 17 Billion Reasons to Say Thanks. The following excerpt is provided to support your efforts to discuss the benefits of GTIN implementation and ROI: In October, 2001 AT Kearney was engaged by the Grocery Marketing Association (GMA) and the Food Marketing Institute (FMI) to evaluate and provide recommendations for e-commerce collaboration. Recommendations of this study included the adoption of an industry-wide, standardized numbering system, providing benefits and savings across the supply chain such as out of stocks, cost of reconciling invoice errors, receiving times, and speed to market. More significant, but more difficult to capture, were the benefits from supply chain visibility and collaboration, that can drive significant inventory reductions across the whole supply chain. All contents copyright 2015 GS1 US Page 25 of 53

26 In the book industry, the move to computerize book information led to the realization that a descriptive/alpha system was too cumbersome. In the grocery industry, the idea had been around, but the evolution of commercially viable scanning equipment signified an opportune moment. It is significant to note that both industries adopted an all-numeric schema. Only in the grocery industry have significant attempts been made to quantify the benefits of using GTINs. Net benefits (after implementation costs) were initially estimated at approximately 1% of sales, but more recently revised to 2.8% of sales, or US$8 billion. These benefits were primarily due to increased process efficiencies and productivity gains. The same studies also estimate that an additional US$15 billion of benefits could potentially be realized through improved collaboration. In the case of the book industry, the benefits and savings of using a standard product identification numbering system were considered so obvious that a cost/benefit analysis was not even done to quantify anticipated results. In conclusion, the agreement to adopt a standardized product identification numbering system provides the foundation to reap extensive benefits throughout the supply chain, not only for all the individual members but also in growing the whole industry. 3 Hot Spots for ROI There are various functions and business processes which will be directly impacted and improved through the use of GTIN. These functions and business processes serve as hot spots for capturing return on investment of GTIN implementation. In order to support your ROI analysis, a list of ROI hot spots is provided below. Begin your ROI analysis by determining the amount of staff time and resources currently allocated to each of these functions. In addition, determine the amount of manual error corrections being done in each function as well. Supply Chain Management Consider each of the following scenarios before and after GTIN implementation: Wrong product shipped due to product number error in purchase order. Wrong quantity shipped due to product packaging level error in purchase order. Product information in purchase reports received from customers and their group purchasing organizations (GPOs) are incomplete. Operational Efficiency In terms of operational efficiency, consider the following for before and after GTIN implementation: Hours devoted to tracking product identification numbers. Hours devoted to dealing with product problems and errors Billion Reasons to Say Thanks: The 25 th Anniversary of the U.P.C. and Its Impact on the Grocery Industry, PriceWaterhouseCoopers, December 14, All contents copyright 2015 GS1 US Page 26 of 53

27 Competitive Advantage In terms of competitive advantages, consider the following metrics which are indicators of customer satisfaction: Customer retention statistics Response time to customers Number of complaints Issue resolution rate (% and time) Error rates Customer value (computed as sales per customer, or lifetime value of customer) All contents copyright 2015 GS1 US Page 27 of 53

28 Lessons Learned & Best Practices The following case studies illustrate lessons learned and best practices for GTIN implementation. Documents can be found in the GS1 Healthcare US Online Tools & Resources. (Visit to download.) In addition, links are provided in the References section of this document. Perfect Order and Beyond: How BD and Mercy/ROi Achieve Far-Reaching GS1 Standards Integration Seton Family of Hospitals / BD Success Story RSS Study - Pharmacia and Dept. of Veterans Affairs RSS Study - Abbott Laboratories and St. Alexius Medical Center RSS Study - Alcon Laboratories All contents copyright 2015 GS1 US Page 28 of 53

29 Frequently Asked Questions (FAQs) What is a Global Trade Item Number (GTIN)? The GTIN is the GS1 System standard term for product and process identification. The GTIN is used for the unique identification of trade items worldwide. A trade item is any product or service upon which there is a need to retrieve predefined information and that may be priced, ordered, or invoiced at any point in the supply chain. A Global Trade Item Number may be 8, 12, 13, or 14 digits in length, represented as GTIN-8, GTIN-12, GTIN-13, and GTIN-14 respectively Is a unique GTIN required for every level of packaging? Yes. There should be a unique GTIN identifying the consumer unit, an inner pack, multi-pack, case, or pallet where applicable. What is GTIN Compliance? Because of history and technical changes, bar codes can be 8,12,13 or 14 digits. A company/organization that is able to process, store, and communicate information about their products with trading partners using all GTINs, whether 8, 12, 13, or 14 digits, is considered to be GTIN compliant. To be current, a GTIN should be stored in a data base as 14 digits. Companies/organizations can become GTIN compliant by expanding the appropriate systems and applications to 14-digits. This will support the GTIN on products at all levels of packaging (consumer, inner packs, multi-packs, cases, and pallets, etc.) It is necessary to become GTIN compliant to take advantage of the benefits of data synchronization using the Global Data Synchronization Network (GDSN). If a change is made to the product does the GTIN need to change? A separate unique GTIN is required whenever any of the pre-defined characteristics of an item are different in any way that is relevant to the trading process. The guiding principle is if the customer is expected to distinguish a new item from an old item and purchase accordingly, a new GTIN should be assigned to the new. For complete information, refer to the GTIN Allocation Rules for Healthcare. What can be identified using the GS1 Identification Numbers? Trade items: Products and services upon which there is a need to retrieve pre-defined information at any point in the supply chain (Global Trade Item Number/GTIN). Logistic units: Physical units established for transport and storage of products of any kind that need to be tracked and traced individually in a supply chain (Serial Shipping Container Code/SSCC). Assets: Fixed or returnable assets (Global Individual Asset Identifier/GIAI, Global Returnable Asset Identifier/GRAI). Locations: Physical, functional, or legal entities requiring a permanent identification, such as a provider, department, or warehouse (Global Location Number/GLN). Service Relations: Public or private service provider to track any entity s service requirements and needs over a continuing relationship (Global Service Relation Number/GSRN). Note: All GS1 identifiers use the same GS1 Company Prefix assigned to the company or organization. All contents copyright 2015 GS1 US Page 29 of 53

30 What are Application Identifiers? The GS1 System uses a bar code that can carry special prefixes to identify and separate multiple identification (ID) numbers. These two-, three-, or four-digit numbers, are called Application Identifiers (AI s). When a scanner sees this special bar code, it automatically knows to look for AI s in order to separate and interpret ID numbers properly. The information that comes after the AI s can contain numeric (n) or alphanumeric (an) data characters. What is a U.P.C.? The U.P.C. on a product is both a bar code and an identification number. The bar code is the bars and spaces, properly termed an EAN/UPC bar code. The product s globally unique identification number is the 12-digit number shown below the bar code, properly termed a Global Trade Item Number (GTIN). Scanning the bar code enters the 12-digit GTIN into business applications the most common use is at the checkout counter. All contents copyright 2015 GS1 US Page 30 of 53

31 Glossary Visit the GS1 US Online Glossary for a complete list of terms Term Glossary Definition AI Application Identifier (AI) Attribute Bar Code Company Number Data Carrier Data Format Data Standard Data Structure EDI Electronic Commerce Electronic Data Interchange (EDI) GLN Global Location Number Global Trade Item Number GS1 Company Prefix GS1 System Acronym for Application Identifier (defined below). The field of two or more digits at the beginning of an element string that uniquely identifies its format and meaning within the GS1 System. A piece of information reflecting a characteristic of the object to which an identification number (i.e., GLN, GTIN, etc.) relates. A precise arrangement of parallel lines (bars) and spaces that vary in width to represent data. A number allocated by the GS1 Numbering Organization. It is combined with the GS1 Prefix (for the GS1 Member Organization) to create the GS1 Company Prefix. The GS1 Company Prefix (i.e., the GS1 Prefix + the Company Number) uniquely identifies a provider. A physical or electronic mechanism that carries data (e.g., a bar code or RFID tag). Required structure for the numerical string of a GS1 Identifier (e.g., text, length, spacing, punctuation, etc.) The entirety of all GS1 System data standardized in meaning and structure. The GS1 System data structures defined in the various lengths required for the different identification purposes, which all share a hierarchical composition. Their composition blends the needs of international control with the needs of the user. Acronym for Electronic Data Interchange (defined below). A method of business communications and management using electronic methods, such as electronic data interchange and automated data collection systems. The computer-to-computer exchange of structured information, by agreed message standards, from one computer application to another by electronic means and with a minimum of human intervention. Acronym for the GS1 Global Location Number (defined below). The globally unique GS1 System identification number for legal entities, functional entities, and physical locations. The GLN is 13 digits, comprised of a GS1 Company Prefix, Location Reference, and Check Digit. Supply side trading partner locations generally include corporate headquarters, regional offices, warehouses, plants, and distribution centers. Demand side trading partner locations generally include corporate headquarters, divisional offices, stores, and distribution centers. The globally unique GS1 System identification number for products and services. A GTIN may be 8, 12, 13, or 14 digits in length, represented as GTIN-8, GTIN-12, GTIN-13, and GTIN-14 respectively. A globally unique number assigned to companies/organization by GS1 Member Organizations to create the identification numbers of the GS1 System. It is comprised of a GS1 Prefix and a Company Number. The specifications, standards, and guidelines administered by GS1. GS1, through the Global Standards Management Process, manages the GS1 System to maintain the most implemented standards in the world. All contents copyright 2015 GS1 US Page 31 of 53

32 Term GS1-128 Bar Code Symbol GTIN Identification Number (ID) Location Number Location Reference Party Supply Chain Partner Trade item U.P.C. symbol United Nations Standard Products and Services Code (UNSPSC) UNSPSC Glossary Definition A subset of the Code 128 Bar Code Symbol that is utilized exclusively for GS1 defined data structures. UCC/EAN-128 Symbols can be printed as stand-alone linear symbols or as a composite symbol with an accompanying 2D Composite Component printed directly above the GS1-128 linear component. Acronym for the GS1 Global Trade Item Number (defined above). A numerical designation that uniquely identifies an object in the supply chain. Identification numbers are used to retrieve information previously exchanged between trading partners and stored in their computer database files. See GLN (defined above). A number within a GLN assigned by various parties to identify a different entity. A Party (or location) is any legal, functional or physical entity involved at any point in any supply chain and for which there is a need to retrieve predefined information. A Party is uniquely identified by a Global Location Number (GLN). A party to transactions in the supply chain, such as a supplier (seller) or a customer (buyer). Any item (product or service) upon which there is a need to retrieve predefined information and that may be priced or ordered or invoiced at any point in any supply chain. A bar code symbol that encodes the GTIN-12, Coupon-12, RCN-12, and VMN-12. An open, global, multi-sector standard for efficient, accurate classification of products and services, managed by GS1 US for the United Nations Development Programme. Companies and organizations use the UNSPSC to analyze various procurement and purchasing functions to reduce organizational costs and improve supply chain efficiencies. The United Nations Standard Products and Services Code structure has four categories: Segment, Family, Class, and Commodity. Acronym for the United Nations Standard Products and Services Code (defined above). All contents copyright 2015 GS1 US Page 32 of 53

33 References GTIN Workgroup To learn more about the GTIN workgroup, contact GS1 US at GTIN Allocation Rules for the Healthcare Sector wnloaderpage.aspx?did=796&ift=1 GS1 US Data Driver GS1 Company Prefix To obtain a GS1 Company Prefix, please call GS1 US at GS1 Check Digit Calculator GTIN Attributes for Healthcare Interactive Spreadsheet wnloaderpage.aspx?did=714&ift=1 GS1 Global Data Dictionary (GDD) GDSN Package Measurement Requirements GS1 Data Quality Framework Including the Data Quality Protocol GS1 GEPIR Online Healthcare Supplier Tool Kits Healthcare Supplier GTIN Quick Start Guide der/filedownloaderpage.aspx?did=793&ift=1 All contents copyright 2015 GS1 US Page 33 of 53

34 GTIN Adoption by Top Global Healthcare Suppliers der/filedownloaderpage.aspx?did=803&ift=1 Transitioning to GS1 Standards for Product Identification: a document assisting manufacturers for migrating to the GS1 Standards for product identification and barcoding wnloaderpage.aspx?did=804&ift=1 Standardization Stat! Industry Awareness Video Industry Sunrise Dates The Case for Global Data Standards in the Healthcare Supply Chain wnloaderpage.aspx?did=354&ift=1 17 Billion Reasons to Say Thanks: The 25 th Anniversary of the U.P.C. and Its Impact on the Grocery Industry wnloaderpage.aspx?did=330&ift=1 Perfect Order and Beyond: How BD and Mercy/ROi Achieve Far-Reaching GS1 Standards Integration wnloaderpage.aspx?did=999&ift=1 Seton Family of Hospitals / BD Success Story wnloaderpage.aspx?did=866&ift=1 RSS Study - Pharmacia and Dept. of Veterans Affairs wnloaderpage.aspx?did=344&ift=1 RSS Study - Abbott Laboratories and St. Alexius Medical Center wnloaderpage.aspx?did=312&ift=1 All contents copyright 2015 GS1 US Page 34 of 53

35 RSS Study - Alcon Laboratories wnloaderpage.aspx?did=314&ift=1 GS1 Healthcare US Website GS1 Healthcare US Tools & Resources GS1 Healthcare US Web Seminars All contents copyright 2015 GS1 US Page 35 of 53

36 Appendix A: GTIN Data Formats Data carriers may or may not restrict the data format of GTINs that can be encoded (e.g., GTIN-12 in UPC-A symbols; GTIN-13 in EAN-13 symbols; all GTIN data structures in GS1-128; GS1 DataBar; GS1 DataMatrix). Because some GTIN fields in databases, IT systems and bar codes require storage as a 14 digit number, it is important to understand how to encode and/or store all GTIN data structures inclusive of NDC/NHRIC as a 14- digit field length (see page 36 for step by step instructions). Regardless of the specific data format, all of the GS1 data standards implement structured, hierarchical numbering schemes in which each identifier is actually a numerical string comprised of several distinct segments. To that end, GTINs are numerical strings that consist of four segments: GS1 Indicator Digit: The indicator digit identifies packaging levels. The field consists of a numeric value from 1 to 9. (The number 0 is used as a fill character when GTIN-13, GTIN-12, or GTIN-8 are stored in 14 digit fields or bar codes.) GS1 Company Prefix: The globally unique number assigned to a company/organization by GS1 US (or by another GS1 Member Organization from around the world). GS1 Company Prefixes are assigned in varying lengths depending on the company/organization s needs. Item Reference: The number assigned by the holder of the GS1 Company Prefix to uniquely identify a trade item. The Item Reference varies in length as a function of the Company Prefix length. (Refer to the GS1 General Specifications and the GTIN Allocation Rules for the Healthcare Sector for additional information.) Check Digit: A calculated one-digit number used to ensure data integrity. To understand how this digit is calculated refer to The various GTIN data structures are presented below in the order most frequently found in U.S. healthcare: GTIN-14: Segments: 14 digits in total: one digit representing the Indicator Digit to denote packaging level twelve digits consisting of: - the GS1 Company Prefix - Item Reference assigned by the manufacturer one digit representing the Check Digit Data Carriers using the GTIN-14 data format: ITF-14 GS1-128 (formerly UCC/EAN-128), GS1 DataBar (formerly Reduced Space Symbology (RSS)), GS1 Data Matrix bar codes GS1 EPC Tags Table 1: GTIN-14 Data Format All contents copyright 2015 GS1 US Page 36 of 53

37 GTIN-12: Required in U.S. Retail and Grocery point of sale. Segments: 12 digits in total: eleven digits consisting of: - the U.P.C. Company Prefix - Item Reference assigned by the manufacturer one digit representing the Check Digit Data Carriers using the GTIN-12 data format: UPC-A UPC-E Table 2: GTIN-12 (U.P.C.) Data Format GTIN-13: Frequently required outside the United States. Segments: 13 digits in total: twelve digits consisting of: - the GS1 Company Prefix - Item Reference assigned by the manufacturer one digit representing the Check Digit Data Carriers using the GTIN-13 data format: EAN-13 bar codes Table 3: GTIN-13 Data Format GTIN-8: Segments: 8 digits in total: seven digits consisting of: - the GS1-8 Company Prefix - Item Reference assigned by the manufacturer one digit representing the Check Digit Data Carriers using the GTIN-8 data format: EAN-8 bar codes* * The GTIN-8 is available for items whose packaging does not include enough available space to permit the use an EAN-13 or UPC-A Symbol. GTIN-8s are individually assigned by GS1 member organization on request. Table 4: GTIN-8 Data Format All contents copyright 2015 GS1 US Page 37 of 53

38 Although the preceding discussion provides a high level description of the information represented by the GTIN segments, it is not intended to imply that GTINs are easily deconstructed into their component parts via visual inspection. The variability of the length of the Company Prefix and the unique methods companies use to create item reference and packaging indicators make such simple translation fruitless. Therefore, users should not use this explanation to attempt to deconstruct the GTIN into its component parts. Instead, the GTIN should only be treated in its entirety and not parsed. The following table provides examples of GTINs providing unique product identification (1) at various packaging levels and (2) using various bar codes. In addition, it displays the data format of the GTIN as it appears (1) in the bar code, and (2) in a database. Table 5: GTIN Examples and Data Formats Description Item Level Bar Code GTIN in Bar Code GTIN in Database Product A Product B Product C Product D Product E Product F Product G Product H Product I 1 Unit Consumer UPC-A Units Case ITF Unit Consumer UPC-A Pack Consumer UPC-A Pack Consumer UPC-A x12 Pack Case GS x12 Pack Case GS Unit Syringe GS1 DataMatrix Units Consumer GS Unit Unit dose blister * GS1 DataBar Units Consumer 100 blisters UPC-A Unit Consumer UPC-A Units Case ITF Unit Consumer UPC-A Pack Consumer UPC-A Pack Consumer UPC-A x12 Pack Case GS x12 Pack Case GS Unit Syringe GS1 DataMatrix Units Consumer GS Unit Unit dose blister* GS1 DataBar Units Consumer 100 blisters UPC Unit Unit Blister GS Units Shelf Pack GS x100 Pack Case GS * A product that can be separated from others on its card All contents copyright 2015 GS1 US Page 38 of 53

39 Appendix B: Integration of NDC/NHRIC into GTINs The National Drug Code (NDC) is used to identify pharmaceutical products, and the National Health Related Item Code (NHRIC) is used to identify medical/surgical products pursuant to FDA regulations. For over thirtyfive years, GS1 has supported manufacturers of healthcare products in integrating these regulatory identifiers into their GTINs. Integration of NDC/NHRIC into GTINs is optional, and not all pharmaceutical or medical surgical companies integrate their NDCs/NHRICs into their GTINs.! A brief explanation of how to create a GTIN with an NDC or NHRIC is provided below. For more information, please consult the document on this topic found in GS1 Healthcare US Document Library (Product ID folder). The Labeler Code is an identifier assigned by the FDA and encoded into the National Drug Code (NDC) and the National Health Related Item Codes (NHRIC) to identify the company. GS1 US has reserved a placeholder in its Company Prefix numbering system so that GS1 Company Prefixes for pharmaceutical and medical/surgical companies is simply their Labeler Code with an 03 appended in front. For example: FDA-assigned Labeler Code Append GS1 US Placeholder 03 GS1 Company Prefix This approach maintains the consistency of GTINs with the Labeler Code, as well as the NDC and NHRIC. In order to use a Labeler Code as a GS1 Company Prefix, manufacturers must first register their Labeler Code with GS1 US. Once the Labeler Code is registered, NDCs or NHRICs can be encoded into either 14-digit or 12-digit GTINs. Steps for both are provided below. Creating a 14-digit GTIN There are five steps for creating the 14-digit GTIN with an NDC/NHRIC encoded: Step 1: When encoding an NDC/NHIC in a bar code, begin with the Application Identifier for a GTIN: (01). Step 2: After the GTIN Application Identifier, Position One is filled with 0 (i.e., zero) as NDC/NHRIC is a reserved number range that will not conflict with GTIN-12, and 0 is always used in the leading position of a 14-digit GTIN field (either database or bar code) when GTIN-12 is encoded. Step 3: The next two positions (2 and 3) must be 03 for products identified by NDCs or NHRICs. A numeric digit 3 in Position Three indicates that the 10 digits in Positions Four through Thirteen are either a NDC or NHRIC. Step 4: The NDC or NHRIC number consists of a variable length Labeler Code on the left (assigned by the FDA; either four or five digits long) and a variable length Product/Package Code on the right (assigned by the holder of the Labeler Code; either five or six digits long). Step 5: Position Fourteen is a Check Digit for the entire GTIN. This number is calculated using the 13 preceding digits. In our particular example, the calculated Check Digit 6 is placed in Position Fourteen. All contents copyright 2015 GS1 US Page 39 of 53

40 (NOTE: Because in Step 2 Position One is a 0 and in Step 3 Position Two is a 0, there is no impact on the calculation of the check digit.) Figure 3: Illustration of NDC encoded in GTIN using GS1-128 bar code carrier (01) AI for GTIN Indicator digit GS1 Prefix FDA labeler code product/package code check digit GS1-128 Creating a 12-digit GTIN There are three steps for creating the 12-digit GTIN with an NDC/NHRIC encoded: Step 1: Position One will always be 3 for products identified by NDCs or NHRICs. A numeric digit 3 in Position One indicates that the 10 digits in Positions Two through Eleven are either an NDC or NHRIC. Figure 4: 12-digit GTIN with NDC/NHRIC Indicator Digit highlighted Step 2: The NDC or NHRIC number consists of a variable length Labeler Code on the left (assigned by the FDA; either four or five digits long) and a variable length Product/Package Code on the right (assigned by the holder of the Labeler Code; either five or six digits long). Figure 5: 12-digit GTIN with NDC/NHRIC Number highlighted NOTE: Bar codes for 12-digit GTINs with human readable format utilize hyphens in this section to display a configuration (i.e., 4 digit, 4 digit, 2 digit), as shown in Figure 5. All contents copyright 2015 GS1 US Page 40 of 53

41 Step 3: Position Twelve is a Check Digit for the entire GTIN. This number is calculated using the 11 preceding digits. In our particular example, the calculated Check Digit of 6 is placed in Position Twelve. Figure 6: 12-digit GTIN with Check Digit highlighted All contents copyright 2015 GS1 US Page 41 of 53

42 Appendix C: GS1 Application Identifiers Beyond the product description attributes defined by the manufacturer and saved in a database, there may be certain item specific attributes that manufacturers or supply chain partners want on products themselves to provide item specific information at the point where the bar code is scanned (e.g., expiration date; lot number; batch number; etc.). In order to facilitate that, the GS1 System provides Application Identifiers (AIs) for encoding item specific attributes directly into GS1 bar codes and GS1 RFID tags [known as GS1 Electronic Product Code (EPC) Tags]. GS1 Application Identifiers (AI) are a finite set of specialized identifiers encoded within numerical string of a bar code. Each AI has a two, three, or four digit numeric prefix that appears in parentheses to signal a certain type of data in the bar code numerical string (i.e., identify what the data in the next string in the bar code sequence is conveying). For example, the AI for lot/batch number is it is (10). Thus, when (10) appears in the numerical string, it means a lot/batch number follows in the next segment. There are approximately 100 AIs. The complete definitions for all of the Application Identifiers reside in the GS1 General Specifications. However, an overview is provided in the table below: Table 6: Overview of GS1 Application Identifiers AI Categories Total # Explanation 7 There is one AI assigned for each of the seven GS1 Identifiers GS1 Identifiers (i.e., GTIN, GLN, SSCC, GRAI, GIAI, GDTI and GSRN). 45 Examples: count; net weight; lot number; expiration date; etc. Trade Item Attributes Logistic Unit Attributes GLN Extensions Special Purpose 28 Examples: count of trade items contained, gross weight, gross volume, routing code 4 GLN physical location attributes. Approx. 20 Shipment Identification, Consignment Identification, Coupons, Refund Receipts, Electronic Serial Identification for Cellular Mobile Telephones, Internal Use, Payment Slips, and Customer Specified Articles GS1 AI s commonly used in healthcare include: AI (01) AI (10) AI (17) AI (21) GTIN Lot/Batch Number Expiry Serial Number GS1 AIs are standard throughout the world and are familiar to IT system developers. GS1-128, GS1 DataBar (RSS), GS1 DataMatrix, and Composite Component can all carry AIs, and more than one AI can be carried in one bar code. GS1 standardized attributes and AIs enable companies to communicate product information as well as item-specific information without encoding it in the identifier itself. All contents copyright 2015 GS1 US Page 42 of 53

43 Appendix D: Illustrations of Bar Coded GTINs GS1 Symbologies encoding GTIN AI (01) GTIN Figure 7: GTIN encoded in a UPC-A Bar Code Figure 11: GTIN encoded in a GS1 DataBar (RSS) Limited Figure 8: GTIN encoded in a EAN-13 Bar Code Figure 12: GTIN encoded in a GS1 DataBar (RSS) Stacked Figure 9: GTIN encoded in a GS1-128 Bar Code Figure 13: GTIN encoded in a GS1 DataMatrix Figure 10: GTIN encoded in an ITF-14 Bar Code All contents copyright 2015 GS1 US Page 43 of 53