House Bill Would Expand Federal Drug Pedigree Requirements and Preempt State Requirements

On April 17, 2008, U.S. Representatives Steve Buyer (R-IN) and Jim Matheson (D-UT) introduced H.R. 5839, the “Safeguarding America’s Pharmaceuticals Act,” which would substantially expand federal drug pedigree requirements.  Among other things, the legislation would authorize destruction of counterfeit drugs at ports-of-entry, revise federal drug pedigree standards and preempt State requirements, require standardized numerical identifiers on each package, require an electronic identification and tracking system to follow drugs through the supply chain, provide grants for community pharmacies to assist them in acquiring hardware and software to comply with the new tracking system, and provide enforcement incentives for States.

If enacted, H.R. 5839 would require pedigrees, in either electronic or paper form, on all prescription drugs sold in the U.S. within 6 months. Longer term, the legislation will require that  manufacturers, distributors and pharmacies put in place systems to electronically track and trace individual prescription drugs through the supply chain.

The bill calls for a risk-based approach to application of unique standardized numerical identifiers for prescription drugs.  Under the FDA Amendments Act § 913, which created FDC Act § 505D(b)(2), FDA must develop a “standardized numerical identifier” that is to be applied to a prescription drug “at the point of manufacturing and repackaging . . . at the package or pallet level, sufficient to facilitate the identification, validation, authentication, and tracking and tracing of the prescription drug.” H.R. 5839 would require that FDA develop, not later than March 27, 2010, a list of drugs at high risk for counterfeiting and diversion.  Within 18 months later, manufacturers of these high-risk drugs would be required to place standardized numerical identifiers on their products.  Manufacturers of other drugs would be required to comply according to a timetable to be established by regulation. 

The regulations are to include a process by which a manufacturer or repackager may request an exemption from the standardized numerical identifier requirement, but only if it can demonstrate that:  “the requirement would adversely affect the safety, effectiveness, purity, or potency of the drug product or would not be technologically feasible”; and “the concerns underlying the request [for exemption] could not reasonably be addressed by measures such as package redesign . . .”

The bill also calls for the development through rulemaking of an electronic drug identification and tracking system through which drug manufacturers, re-packagers, wholesale distributors, and dispensers will be able to authenticate the wholesale distribution history of any drug by authenticating its standardized numerical identifier against an interpretable electronic database.  Regulations proposing such a system are to be published by March 31, 2010, with final regulations issued not later than one year after the date of the proposed regulations.  The regulation must take into account the technical feasibility of compliance by manufacturers, repackagers, wholesale distributors, and dispensers, for different types of drugs.  Once effective, the rules would preempt any inconsistent state requirements.  (So far, the only state to enact an electronic pedigree requirement is California.  The requirement will take effect on January 1, 2011.)

The federal bill provides for grants to pharmacies to facilitate the purchase and use of a drug identification and tracking system.  To be eligible for such grants, the pharmacy must apply to the Secretary of Health and Human Services and agree to match funds.  The bill also provides for reports to Congress for delays in issuing proposed or final regulations; civil penalties for violations; and incentives for State enforcement of federal requirements.    

The Healthcare Distribution Management Association, a national association of healthcare distributors, supports the bipartisan legislation.

By Anne Marie Murphy