Collaboration key to a healthy supply chain in 2016

Pharmaceutical CommercePharmaceutical Commerce - January/February 2016

HDMA seeks to encourage more outreach to business partners and government

Recently, “collaboration” has become a buzzword across the pharmaceutical sector, and certainly within HDMA, as distributors, manufacturers, dispensers and regulators have worked together to ensure that the supply chain operates safely and efficiently to the ultimate benefit of the millions of patients it serves. Collaboration has been most evident in the way the supply chain has tackled two of our industry’s toughest issues—traceability and prescription drug abuse.

Upon passage of the Drug Supply Chain Security Act (DSCSA) in 2013, many industry observers concluded that the groundbreaking legislation would truly transform the pharmaceutical supply chain. Two years later, those observations have been met and exceeded. Transformation has occurred not only in the way information is shared between trading partners, but in the way we collaborate across the supply chain, within our individual organizations, and, importantly with FDA and state regulators, to overcome complex and challenging implementation hurdles.

HDMA has served as a forum—through our working groups, annual Traceability Seminar and other educational offerings—for healthcare supply chain leaders to discuss new uses for technology and compliance questions as they work through the DSCSA implementation requirements. While we have had successes—the first milestone to receive transactional information was met in 2015—the work is far from done. A common refrain at our seminar last year (our largest yet) was to “keep the momentum going.” Accordingly, 2016 will find HDMA and its members focusing on future milestones as the supply chain aims for the 2023 finish line.

For example, beginning in 2019 distributors will have additional requirements when dealing with saleable returns as part of the transition to using the unique product identifier for eventual unit-level traceability. To better understand the impact of deadline, and how the industry can work together to best meet these requirements, this year HDMA, working with EY, is sponsoring a pilot study for distributors and manufacturers to examine different methods of verifying product identifiers. This pilot will help trading partners gain first-hand, real-world experience with the processes and technologies required to effectively manage saleable returns from the dispenser to the distributor, and coordinate mandatory verification of product identifiers with the manufacturer.

By the end, participants will better understand how processes and technology can be used to efficiently and effectively implement this requirement, as well as the potential impact of associated costs—on logistics, operations and on their businesses as a whole. The results of this pilot will be shared with organizations across the supply chain.

Further, HDMA is helping its members prepare for future DSCSA requirements by once again providing education through our Distribution Management Conference in March, and later, at the Traceability Seminar in November.

Additionally, HDMA is taking steps to understand the benefits of implementing traceability systems, among other issues, as the supply chain takes on an increasingly global perspective. In the last few years, the association has allied with our counterparts from around the globe to learn about common challenges and opportunities. In November 2015, HDMA hosted, with the International Federation of Pharmaceutical Wholesalers (IFPW) and the European Healthcare Distribution Association (GIRP), the second annual International Pharmaceutical Distribution Conference in Brussels, Belgium, which featured a robust discussion that compared the traceability implementation processes of Europe and the US. We look forward to continuing this conversation on September 12—13 when the association will host its next conference in London, England.

HDMA’s commitment to a safe and secure supply chain extends beyond implementation of the DSCSA, most notably, to prescription drug abuse, where the association is continuing its collaborative efforts to help mitigate this public health challenge in the US.

A bipartisan proposal in Congress—The Ensuring Patient Access and Effective Drug Enforcement Act of 2015, sponsored in the House by Reps. Marino (R-PA), Blackburn (R-TN), Welch (D-VT) and Chu (D-CA) and by Sens. Hatch (R-UT) and Whitehouse (D-RI) in the Senate, is one workable solution that is gaining traction. The legislation is widely supported by healthcare industry organizations and nearly 30 patient and provider groups, as it promotes better collaboration and transparency between pharmaceutical supply chain stakeholders and enforcement agencies to help effectively address this problem.

HDMA also stands ready to partner with regulators, such as the Drug Enforcement Administration, which has showed increased willingness to work with the industry to tackle this issue. While HDMA still calls upon the agency to provide greater clarity to registrants, the association is greatly encouraged by the agency’s more collaborative stance. Beyond the DEA, HDMA will stand with such national organizations as The Alliance to Prevent the Abuse of Medicines, the Community Anti-Drug Coalitions of America and The Partnership for Drug-Free Kids, to help reduce this problem.

Given these priorities, and the many others that may unfold, in 2016 and the years to follow, HDMA and its distributor members will continue to be critical and collaborative with supply chain partners in ensuring the continued safe flow of pharmaceuticals every step of the way.


John M. Gray is president and CEO of the Healthcare Distribution Management Association, Arlington, VA.

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