The FMD: business risks and why NMVOs matter

EU capsuleThe famous delegated act (now a delegated regulation, DR) - the remaining piece of the Falsified Medicines Directive puzzle - was published on February 9. Set your timers to three years and press the button. No more what-ifs, wait-and-sees, or wishful thinking. The time to act is now.
Most of the key details in the DR have been heavily trailed since last year, and the basic technical principles have been around since the FMD was adopted in 2011. Here are some highlights:

Serialization (needed)

For marketing authorisation holders, the latest DR means coding packs (serialisation) and applying tamper-evidence. Many have already gone well down the path to compliance, but we still hear of companies who have yet to start the process. There really is no more time to waste. These projects are complex and take a finite time that is hard to crush down. They need the involvement of hardware and software vendors whose lead times are getting longer. The most popular suppliers can be choosy because a queue is forming. We are already seeing much less flexibility on pricing and contracts. Manufacturers who didn't put FMD money in 2016's budget will need to find some. Starting the project in next year's budget cycle is too late.

Tamper-evidence (under-estimated)

The star of the FMD story in recent years has been digital traceability. The Cinderella character is tamper-evidence. Making sure that the pack cannot be secretly opened and reclosed is conceptually simple and any ISO-compliant technology will be acceptable. However, there are machinery costs, consumables (glue, seals etc) not to mention line cleaning, inventory management, process issues etc. The good news is that tamper-evidence and serialisation equipment can often be integrated into one new machine. One final thought: your tamper-evident closure should ideally contain a hidden security feature so you know if a suspect but apparently unopened pack has had the seal replaced.

Aggregation (not needed?)

The basic requirement for unit-of-sale pack coding, or serialisation, is onerous enough. But what if your downstream business partner wants you to go further? Many large distributors would prefer to receive aggregated data, i.e. to have the ability to scan one code on the outside of a shipper box or pallet and infer the identities of all the unit packs inside without opening the box. The data aggregation needed for this during production imposes yet greater costs and complexities on manufacturers and many are avoiding it because the FMD doesn't require it. Yet big distributors get a lot of returns for normal business reasons - 2 per cent is typical. Risk-based verification rules in the FMD will require them to check the codes on those packs. They would much rather scan an aggregated shipper than unpack it and re-work it. So don't assume that aggregation is off the table in Europe.

Repositories (critical)

So much for the direct business risks and costs. There are also some subtler worries. What if the number repository system is unreliable? Recall that the FMD proposes nationally-managed entities, often referred to as National Medicine Verification Organisations or NMVOs, to run the data verification system in their country. There are three pre-approved technology providers who will be vying for this business, and the next few months will see a flurry of business development and contracting activity as a couple of dozen major medical IT projects get under way simultaneously across the EU. Don't expect everything to go smoothly over the next three years.

The impact for distributors and manufacturers will be severe if these national systems are poorly implemented, late, error-prone, slow or difficult for pharmacists to use. If there are large numbers of packs coming back due to downstream system failures then it will present a major additional cost burden.

Extra people and systems will be needed to untangle and re-work the data and to make the product saleable again. For manufacturers who aren't aggregating during production, even getting a whole, pristine, unopened pallet or shipper case back will mean breaking down to unit pack level, checking the codes, re-boxing, etc. This means that if you are a manufacturer you should get closely involved with the NMVO selection process (either directly or through your trade association) in the countries in which you operate. Ask awkward questions, check system designs and confirm vendor capabilities.  Understand if they have practical experience and expertise to match. Make sure they have a service which is fully compliant with the DR and will allow manufacturers to test their 2D codes before the implementation deadline. Time spent now on ensuring the right approach will be well spent.

Planning (imperative)

The FMD and its new DR sequel should be welcomed. They present a technical challenge but the benefits will be real and long-lasting. A wave of traceability initiatives around the world will improve patient safety and provide the enabling technology for other benefits such as better pharmacovigilance, improved adherence, mobile health etc.

Getting ready to comply with FMD will take the full three years, so the time to plan and act is now.

Mark Davison is principal consultant and chief executive of Blue Sphere Health

Image courtesy of Shutterstock / Per Bengtsson

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