Increasing efficiency & security in the Pharma Supply Chain.

(Note: While this analysis was first shared in 2004-2005, it is still relevant today in 2007)  In a direction setting communication on November 15 2004, the US FDA identified RFID (Radio Frequency Identification) as a potential key technology for track-and-trace throughout the Pharma supply chain.

The FDA wants to rapidly promote RFID usage by the U.S. drug supply chain by 2007. RFID uses electronic tags on product packaging to allow manufacturers and distributors to precisely track drugs as they move through the supply chain. Unlike bar codes, the RFID tags can identify unique products and cannot be duplicated. RFID tags can carry more information, and encryption for additional security is also possible.

Industry leaders are seeing value of RFID in the following areas: Fine-grained Inventory Management (expiry-date management based on the environment’s effects on the active ingredients) Improved blocking to Counterfeiting Better control over Drug Recalls Improved tracking of Products during diversions

Some projects have been initiated:

• Pfizer to place RFID tags on all bottles of Viagra for sale in the US in 2005.
• Purdue Pharma is placing RFID tags on bottles of OxyContin to authenticate and track & trace this pain medication.
• GlaxoSmithKline plans to use RFID tags on at least one product deemed susceptible to counterfeiting.

While the initial projects have started, it is important to acknowledge that the RFID technology and standards are evolving, and large software vendors like SAP, Oracle, and IBM are still firming their products. Existing track-and-trace systems are not going to be displaced overnight.

As a Pharma Supply Chain executive, your question is: How do I integrate RFID with existing ERP, SCM, WMS, manufacturing and packaging apps to get real-time drug shipment status?The answer lies in doing a combination of buy and build. The need is to buy hardware and software that is somewhat mature, build necessary integration with existing supply chain systems, and keep the solution flexible to accommodate changes in technology and regulations. In addition to deploying RFID tags and readers, you also need to ensure that the solution is capable of filtering out huge amounts of data while recognizing relevant information.