Pharmaceuticals Slow to Meet Drug-Tracking Laws

Computerworld - Pfizer Inc. last week unveiled plans to begin shipping its first drug product equipped with radio frequency identification tags to thwart theft and counterfeiting.

However, the company, along with many other drug firms, is still not prepared to meet the conditions of new legislation in two large states requiring that pharmaceutical firms trace prescription drugs as they move through the supply chain.

A new Florida law requires that by July 1, wholesale distributors operating in the state provide a so-called electronic pedigree system that can track drugs through the supply chain. A similar California law goes into effect Jan. 1, 2007.

While Pfizer is adding RFID tags to all packages of Viagra sold in the U.S. so that pharmacies and wholesalers can verify the authenticity of the drug (see "Pfizer to use RFID tags on Viagra to prevent fakes"), the application can't track and trace medicines through distribution channels in accordance with the laws.

In a statement, Pfizer said that extending its RFID program to comply with the e-pedigree laws would require that all parts of the supply chain invest in compatible technology. Each part of the chain would also have to agree to capture and share information about product movement, the statement said. Pfizer said it will further explore its use of RFID technology this year.

Despite facing deadlines to meet the Florida and California requirements, many other pharmaceutical firms have also been slow to create systems that can generate a pedigree, said Laura Ramos, an analyst at Forrester Research Inc.

"They have a public position that whatever the legislation is, they will meet" the requirement, she said. "Behind the scenes, they are scrambling."

In a September Forrester study, Ramos reported that a survey of executives at 20 pharmaceutical and wholesale drug distributors, which account for 80% of drugs sold worldwide, found that none had yet built a pedigree system. The survey further found that seven of the companies had done no work on electronic pedigrees and that none of the remainder had moved past the early phases of such projects.

Tom Loane, vice president and CIO at Teva Pharmaceuticals Industries Ltd.'s North American division in North Wales, Pa., said his company is still studying the issue and defining a strategy.

"We do not yet have a plan," he said.

Ronald Bone, senior vice president of distribution support at McKesson Corp., the largest pharmaceutical distributor in the U.S., said his company is integrating its warehousing system with an undisclosed software package to comply with the Florida legislation.

The software,