Suspect and Illegitimate Products. Francis B. Palumbo, PhD, Esq. University of MD School of Pharmacy Center on Drugs & Public policy

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1 Suspect and Illegitimate Products Francis B. Palumbo, PhD, Esq. University of MD School of Pharmacy Center on Drugs & Public policy

2 The Pharmacy Profession Pharmacists, have always enjoyed the comfort of believing that the products they dispensed were not counterfeit. In fact they rarely, if ever, gave it a thought. Events of the last decade or more have changed this.

3 FDA Counterfeit Drug Cases Opened Year No. of cases opened

4 Extent of Counterfeit Drug Problem WHO estimates that the worldwide sales of counterfeit drugs are $32 billion annually FDA has received different figures describing the global counterfeit problem and does not report an estimate for the United States FDA estimates that in some countries the counterfeit rate is around 10% (South East Asia), but as high as 40% in other countries (Mexico, Colombia, Argentina) If even 1 percent of the ~4 billion outpatient prescriptions dispensed in the US were counterfeit, that still amounts to ~40,000 prescriptions per year!

countries the counterfeit rate is around 10% (South East Asia), but as high as 40% in other countries (Mexico, Colombia, Argentina) If even

5 Secondary Unauthorized Wholesale Distributors & Risk of Counterfeits Approximately 6,000 registered wholesale distributors in the U.S. Many are unauthorized (It is not illegal to be unauthorized)

6 Authorized Distributor The PDMA defines an authorized distributor of record as a wholesaler that has an ongoing relationship with the manufacturer to distribute the drug.

7 Ongoing Relationship 21 CFR 203.3(u) Manufacturer and distributor enter into a written agreement Distribute manufacturer's products for a period of time or a number of shipments, or Distribute only certain specific products of that manufacturer

agreement Distribute manufacturer's products for a period of

8 Secondary Unauthorized Wholesale Distributors & Risk of Counterfeits Movement to seek change in certification process Background checks by states NABP s Verified Accredited Wholesale Distributors Program (VAWD) 548 as of December11, 2013 (Source: NABP Website) Stricter documentation on origin of drugs

states NABP s Verified Accredited Wholesale Distributors Program (VAWD) 548

9 Distributor Licensing & Pedigree Requirement by State (as of ) No Legislation or regulation 20 Enacted legislation; rules pending 3 Proposed legislation 1 Final Rules adopted 18 Rules pending; no legislation 0 Enacted legislation 8 Source:

legislation 1 Final Rules adopted 18 Rules pending; no legislation 0 Enacted

10 DQSA Provisions Expressly Preempt All state laws relating to drug pedigree and track and trace Any state laws for the licensing of distributors that are inconsistent with federal requirements.

11 Dispensers v Wholesalers Wholesalers purchase in large volumes (e.g. cases). Pharmacies purchase smaller amounts (e.g. one or several bottles of product). An individual pharmacy could need to track thousands of packages and account for returns, out of date, destruction, pilferage, etc.

12 Impact on Workflow & Cost of Doing Business Highly dependent on the degree to which all of the transactions and records (easily retrievable) can be automated. For example Transaction history Transaction statement Lot level information for recalls or investigations Disposition of illegitimate product Returns (not a problem as long as returning to the entity from which obtained) Sales to another dispenser to fulfill a specific patient need are exempted.

For example Transaction history Transaction statement Lot level information for recalls or investigations

13 Costs (examples) Cost of equipment to read the coded information and maintenance of the equipment. Cost of additional hardware and/or software Cost of qualified personnel to deal with all of this new reporting and tracking Cost to vendors to do some of the work (could it be an add-on service from existing computer vendors?) Other

Cost of additional hardware and/or software Cost of qualified personnel to deal

14 Reimbursement? Within our existing system of drug distribution in the U.S., would dispensers be able to capture any of these expenses in their fees? Part D is still handled by competitive PDPs Insurance plans and employers still use PBMs who negotiate and live in a competitive world State Medicaid programs are unlikely to raise fees to accommodate this Etc.

Part D is still handled by competitive PDPs Insurance plans and employers still use PBMs

The Drug Supply Chain Security Act: Readiness and Implementation Update

The Drug Supply Chain Security Act: Readiness and Implementation Update Connie Jung, RPh, PhD U.S. Food and Drug Administration Center for Drug Evaluation and Research Office of Compliance Office of Drug