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Injunction against federal pedigree requirements is not halting supply chain upgrading,
   Date: 2006-12-27

at least according to Supplyscape, Inc. (Woburn, MA), one of the leading IT vendors of pedigree-management systems. The injunction, won by several secondary wholesalers led by RxUSA (Port Washington, NY), enjoins FDA from requiring pedigrees for every transaction back to the original manufacturer. Earlier this year, FDA had announced that it would lift the decade-old stay on the Prescription Drug Marketing Act (PDMA) on Dec. 1. The rules are now in effect, with the exception that “non-ADR” (authorized distributor of record) wholesalers only need to provide pedigree documentation for the immediately prior transaction, such as buying product from an ADR.

This injunction, together with the exemption for ADRs for providing any pedigree information at all in most states, leaves many holes in the pharmaceutical distribution system; plugging those holes was the original intent of PDMA. Manufacturers themselves are generally exempt from pedigree regulations.

But, “we’ve not seen any slowdown as a result of this latest ruling,” says Shabbir Dahod, CEO of SupplyScape, who says that a year ago, SupplyScape had four pharma-industry projects, and now it has 40, 40% of which are at branded, generic and biotech manufacturers, 50% among wholesalers, repackagers and specialty distributors, and 10% among pharmacy chains and others. “What we are seeing is that companies who have adopted the technology are now proceeding to improve their supply chain practices through lower inventory costs, better supply chain visibility and other business values,” he says. “We’ve maintained all along that the best situation for the industry would be for all trading partners, including manufacturers, to leverage their pedigree documentation for its business value, not just to meet PDMA rules.”

Meanwhile, FDA has issued updated information on its website for how it will enforce PDMA, and the independent wholesalers who brought the lawsuit say that they are now readying their legal case for a full-blown trial over pedigree rules.

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