In particular, FDA is providing the one-year compliance extension to allow supply chain stakeholders to establish the necessary systems and processes for secure, interoperable electronic tracing at the package level, including providing transaction information that includes serialization to the package level for each package included in a transaction. Just a few days later, FDA issued two related DSCSA guidance documents. One extends the compliance deadline for wholesalers and dispensers regarding certain Verification Requirements, and the other focuses on FDA expectations for Enhanced Drug Distribution Security at the Package Level, acknowledging that FDA had previously extended the compliance date for these requirements.

Background

Under the DSCSA, enacted by Congress on November 27, 2013, trading partners — including drug and biological product manufacturers, wholesale distributors, dispensers, and repackagers — are subject to requirements for enhanced drug distribution security under section 582(g)(1) of the Federal Food, Drug, and Cosmetic Act (FDCA). These requirements are scheduled to take effect starting November 27, 2023; however, FDA has heard from industry and lawmakers that there would likely be supply disruptions, potentially leading to patient access problems and drug shortages, if compliance were required by November of this year.

In the past few months, letters from trade associations for manufacturers, wholesalers and dispensers have highlighted that many trading partners will not be ready by the November 27, 2023 date. Industry has explained that this could lead to significant disruptions in patient care and harm to patients. Similarly, a bipartisan letter from Members of Congress expressed concern regarding the upcoming deadline, sharing their understanding that supply chain participants are facing difficulties meeting requirements. Among other requests, the letter asked FDA to assess the readiness of trading partners, consider a phased approach to implementation, and issue compliance policies through guidance by the end of August 2023.

Compliance Policy on Enhanced Drug Distribution Security Requirements

In response to these and other comments, FDA acknowledged that the Agency “understands that additional time beyond November 27, 2023 may be needed for systems to stabilize and be fully interoperable for accurate, secure, and timely electronic data exchange.”  Accordingly, the guidance announces that FDA does not intend to take action before November 27, 2024 to enforce the DSCSA requirements relating to the following requirements that relate to electronic tracing at the package level:

• Including in transaction information the elements of the product identifier (i.e., the standardized numerical identifier consisting of the NDC and serial number, lot number, and expiration date) at the package level for each package;
  • FDA does not intend to enforce this requirement for product introduced in a transaction into commerce by the product’s manufacturer or repackager before November 27, 2024 through such product’s expiry (section 582(g)(1)(B));
• Transaction information and transaction statements being exchanged in a secure, interoperable, electronic manner in accordance with applicable standards (section 582(g)(1)(A));
• Systems and processes for verification of product at the package level, including the standardized numerical identifier, which includes serialization (section 582(g)(1)(C));
• Systems and processes necessary to promptly respond with the transaction information and transaction statement if requested by a Federal or State official associated with a recall or for the purposes of investigating a suspect product or an illegitimate product (section 582(g)(1)(D));
• Systems and processes necessary to promptly produce the transaction information for each transaction going back to the manufacturer, as applicable:
  • In the event of a request by a Federal or State official on account of a recall or for the purposes of investigating a suspect product or an illegitimate product; or
  • In the event of a request by an authorized trading partner, in a secure manner that ensures the protection of confidential commercial information and trade secrets, for purposes of investigating a suspect product or assisting a Federal or State official (section 582(g)(1)(E)); and
• Systems and processes to allow acceptance of saleable returns that are associated with the transaction information and transaction statement for each product (section 582(g)(1)(F)).

While providing industry with this additional time, FDA emphasizes that the compliance policy is not intended to provide a justification for delaying efforts by trading partners to implement the enhanced drug distribution security requirements.  “FDA strongly urges trading partners to continue their efforts to implement necessary measures to satisfy these enhanced drug distribution security requirements.” (emphasis in original).

Compliance Policy on Verification Requirements for Wholesalers and Dispensers

FDA also extended by one year the compliance policies covering certain verification requirements that were set to end on November 27, 2023 under its earlier September 2019 and October 2020 guidances. In final guidance, FDA states that it does not intend to take action before November 27, 2024 against wholesale distributors who do not verify saleable returned products or have the verification systems and processes in place required for such products. FDA further states that it does not intend to take action before November 27, 2024 against dispensers who do not verify the product identifier for suspect product or illegitimate product. The Agency explains these compliance policies are intended to minimize possible disruptions in prescription drug distribution and to align with FDA’s intention to generally not enforce the DSCSA enhanced drug distribution security requirements before November 27, 2024.  

Final Guidance on Enhanced Drug Distribution Security Requirements

In the final guidance “Enhanced Drug Distribution Security at the Package Level Under the Drug Supply Chain Security Act,” FDA clarifies the requirements for enhanced drug distribution security and provides recommendations on the necessary systems and processes for enhanced product tracing and enhanced verification. This final guidance largely mirrors the draft guidance issued in June 2021, but FDA notes that references to compliance by November 27, 2023 are subject to the compliance policies articulated in the guidances described above.

If you have any questions on how to comply with the requirements of the Drug Supply Chain Security Act, please contact either of the authors of this alert or the Hogan Lovells attorney with whom you generally work.     

Authored by David Horowitz and Deborah Cho.