If you're having trouble explaining DSCSA to your team, tell them these five things.

October 19, 2023

The Drug Supply Chain Security Act has now been on the way — and in implementation, by phases — for ten years. However, misunderstandings and misinformation still abound; far too many trading partners, especially pharmacies, don't have a clear view of what it is, how it secures the US supply chain, and what happens next month.

Read on for a quick DSCSA explainer!

1. DSCSA affects every pharmaceutical company in the supply chain.

Dating back to 2013, the law's phased rollout now spans three presidential administrations. DSCSA is the second part of the Drug Quality and Security Act, which was created after nationwide outbreaks showed dangerous vulnerabilities in drug supply chain tracking.

It applies to every company that makes, manages, handles, and sells pharmaceutical products, from drug manufacturers through patient-facing pharmacies. While certain exemptions exist, they're narrowly defined cases; the key tenets of the law apply to every pharmaceutical business.

No trading partner can fulfill the requirements of another, even if they've established tools for collaboration; for example, a dispenser that uses a distributor's portal for DSCSA data is not protected by it —  it still needs its own DSCSA system!

2. DSCSA serialization makes patients safer.

The key requirement that goes into effect in November 2023 (with cross-industry stabilization set for a year after that date) is complete item-level traceability. This requires each individual package to be traceable individually rather than solely at the lot level, as well as to be aggregated to cases and pallets.

DSCSA serialization will enable any trading partner who interacts with a package to view each event in its history, back to the manufacturer. This capability doesn't rely on any single repository of information. Instead, it uses interoperable connections between any pair of trading partners, a process that usually takes a few weeks to put in place. (This is one reason to build in a generous amount of lead time for a DSCSA implementation -- every business in the pharmaceutical supply chain will need to form and test these connections with each of their trading partners.)

The combination of item-level traceability and interoperable connections to cement an item's history, plus reports to the FDA and trading partners regarding suspect product, prevent counterfeit, redirected, or otherwise suspicious goods from entering the US pharmaceutical supply chain. Further, it ensures that any recalled or potentially dangerous products can be removed from the supply chain quickly via coordinated action.

3. It's creating an explosion of transaction data — and transaction data errors.

We're seeing an across-the-board spike in EPCIS files being exchanged. This is hardly unexpected; in fact, we're predicting a more than hundredfold increase in the real-world data exchange rate by the time DSCSA is fully implemented.

This is largely due to the need to track items at the individual level, and with exhaustive event histories (essentially the function of each EPCIS file). To some trading partners, the jump may seem shocking; even if their product levels don't increase significantly, the amount of data created will. Unfortunately, the rate of data errors is increasing at the same rate. These errors, known as exceptions, can halt product movement and take days, or even weeks, to resolve.

Under DSCSA, when there's a mismatch between data and product, or if key data is missing, movement must stop and the product must go into quarantine until the issue's been resolved. This makes communication between trading partners (in addition to robust technology and processes for investigating exceptions) vitally important to healthy supply chain operations.

Trading partners who prepare for this with solutions for exceptions management are preventing costly, time-intensive, and frustrating hassles. For example, the wholesale distributor TopRx understood the challenge and took action.

4. If you're feeling DSCSA "peer pressure," it's time to listen.

No one likes to be pushed, but if your partners are pressing you on DSCSA, it's simply because they want to keep doing business with you.

It's in the interest of pharmaceutical businesses everywhere in the supply chain to collaborate on DSCSA, and that means educating their trading partners when necessary. For starters, you'll need to work together to form and test interoperable connections (though in some cases, pre-tested connections are available). Each company also needs to ensure that they only doing business with Authorized Trading Partners, under the FDA's definitions and licensure requirements for their business types.

We also see a lot of pressure between trading partners around exceptions. For a given business that has implemented DSCSA, it quickly becomes clear which of their partners are ready for exceptions management and which aren't. The latter are the ones having trouble executing complete data exchanges, meaning that many interactions might carry added labor and wait times (and thus costs) before products can leave quarantine and be transferred or sold as planned.

5. If you don't have a DSCSA system by November 2023, your business is at risk.

You may have heard the FDA's statement that it “does not intend to take action to enforce” 582(g)(1) until November 27, 2024. However, this statement is incomplete, and its reading out of context has caused significant and damaging misinformation; FDA representatives said they were "appalled" to learn that some trading partners were using it to justify slowing down DSCSA progress.

Starting November 27, 2023, all trading partners must begin stabilizing (polishing, fixing, and testing) their systems for DSCSA compliance. To do this, the system must be in place before that date. In short, all trading partners are expected to make full use of the time remaining in 2023 and 2024 for DSCSA compliance.

This stabilization period does not push back the deadline. Instead, it grants the time needed to complete implementations that are (or should be) already underway and make sure they work well. Importantly, State Boards of Pharmacy can still enforce DSCSA requirements, and may undertake audits to ensure that businesses have systems in place as of November 27, 2023.

As an FDA presentation stated:

"This is a stabilization period, not enforcement discretion."
"All current DSCSA requirements continue as a condition of FDA's non-enforcement."
"Stopping or slowing efforts to get into compliance with 582(g)(1) puts a trading partner at risk of FDA enforcement."

Get in touch with LSPedia if you still have questions about your DSCSA requirements —  or how to get them done in time.