Q&A: Why NDC-12 Readiness Has to Happen Before Day One

The FDA's final rule standardizing the National Drug Code to a 12-digit format takes effect March 7, 2033, but the run-up to that date is already reshaping how supply chain partners plan their technology work.¹ The rule affects only FDA-assigned NDCs and leaves the HIPAA standard 11-digit format used for reimbursement untouched. Still, the agency has been clear that the seven-year period before the effective date is meant to be used: manufacturers, distributors, repackagers, pharmacies, providers and payers are all expected to update their systems, processes and infrastructure well before Day One.¹ A three-year window follows for labeling to catch up, during which trading partners have to be able to handle both 10-digit and 12-digit NDCs at once.

The scale of that lift extends into packaging and barcoding as well. The final rule allows NDCs to be encoded in either linear or nonlinear barcode formats, as long as they meet standards set by a recognized body such as GS1, the same infrastructure much of the industry already relies on for DSCSA serialization. FDA's own stated aim is to get the entire health care industry onto a single NDC format, cutting out the conversion work and added quality-control checks that payers and other stakeholders currently need just to confirm a drug product and its NDC line up.² For a national distributor, that only widens the audit: every EDI transaction, ERP record, packaging line and warehouse scan that touches an NDC today has to be mapped against what changes once the new format takes effect.

That's the vantage point Ameer Ali, senior director of manufacturer operations and data services at Cencora, brought to a recent panel, "Readying Supply Chain Systems and Packaging to Transact NDC-12," at HDA’s 2026 traceability seminar. Pharmaceutical Commerce spoke with Ali about where the industry stands on the NDC-12 transition, how much variation he's seeing across the manufacturers and trading partners, and what could go wrong for product movement if systems aren't ready when the transition period opens.

PC: For a distributor, what's the biggest operational lift in preparing EDI and back-office systems for NDC-12, and where is that work furthest along right now?

Ali: Cencora is a pretty large distributor. We handle a large amount of volume, inbound and outbound, with a variety of customers and trading partners. So the NDC numbers touch on many transactions and many processes, from ordering to shipping, receiving and billing. Operationally and financially, NDC numbers are critical and create a lot of opportunities, a lot of touch points. When we look at how to approach this, we're approaching this as a transformation of the supply chain to a new way of moving the data, a new way of identifying the products. So that is part of what we're doing today, as an assessment of what every process is and every system that the NDC number touches, and how we have to update those.

How much variation are you seeing in NDC-12 readiness from one manufacturer to the next, and is that inconsistency likely to create bottlenecks for the industry as a whole?

We do see a lot of variation. It is still early. We don't want to say it's early to take action, but it's still early in the process of the roadmap, if you will. Some manufacturers have very much completed their assessments. They've, for the most part, made their determination on what action items they need to have. And others are still waiting on guidelines to come out, more information to come out, more clarity before they start taking action. So we see that variation, and at this point in the process, that's fine. We also have to consider the downstream partners as well, and ourselves and our downstream partners, because this type of change impacts the entire supply chain all at once. There is no gradual implementation per se in terms of when it goes live. But there are several years ahead of us here that we can all make changes gradually in preparation for that effective date.

If EDI or packaging-line systems aren't ready when the rule takes effect, what's the real risk to product moving through the supply chain? Could that mean delays or shortages, or is the three-year transition window enough of a buffer?

The transition period itself is a period where it's expected that starting Day One, everybody is ready. And the effective date is Day One of the transition period, and any manufacturer is allowed starting Day One to sell products that are using the NDC-12. So by nature of that transition period, everybody downstream has to be ready, no questions about it. The actual transition, product by product, manufacturer by manufacturer, could be done gradually, and we fully expect that. Not every manufacturer's going to start Day One selling NDC-12 product all of a sudden. You have to deplete inventory that you have. You may have to deplete labels that you have to still package with and whatnot. That'll be a gradual transition, but if anybody is not ready, if, let's say, our EDI systems can't handle it, our master data's not updated, our ERP system where we create the orders isn't ready, or even our scanners, for example, our warehouse systems and scanners — if any of these components, systems or processes are not ready, that product could basically stop at that point, and either we won't be able to receive it or we won't be able to ship it to our customers. It is absolutely critical that readiness is across the board, and that's why we have to get ready ahead of time, not on the effective date, but rather a couple years ahead or so, both to know that everything is going to work, but also to do some testing. We cannot turn this on for the first time and test it on Day One. It has to be tested ahead of time.

With that three-year transition period once the rule takes effect, what should companies be doing this year, specifically, to avoid a bottleneck later on?

We encourage everybody to start doing their assessments sooner rather than later. In the next few months is a great time. One, a lot of guidelines and a lot of standards are going to be updated and published before the end of this year. We expect to see new EDI guidelines, EPCIS standards updated, bar coding standards updated, and of course, clarity from regulators as well on what the expectations are. Over the next few years, we expect and encourage everyone to have a roadmap, to say, start with when you need certain things to be ready ahead of that effective date, but then work your way backwards from there. Ask, “I need to update these systems, these tools, these processes — how long is it going to take? What's the level of effort and resources?" But also some dependencies. There may be, in everybody's plan, they have to determine what needs to happen first. You may not be able to update one system before another, so that all should be part of your roadmap.

Create that roadmap early after you do your assessment of your systems and processes. Once you have a roadmap, that could be communicated also to your trading partners, so you can ensure alignment across your supply chain that your trading partners are going to be ready when you need to test with them. These are just some of the high level steps and milestones. Everyone's going to have to make their own assessment of their internal systems, but also in the context of the larger industry. During the transition period, everybody has to be able to transact with both the old and the new NDC numbers. It is fully expected, as a distributor, I'm going to have inventory potentially with a 10-digit NDC, but my supplier may start shipping me 12-digit because they depleted what they have. Meanwhile, my customer could return something to me that's a 10-digit while I've already depleted what I have. I could get a saleable return back that I have to resell, or I have to process again. So it is very much expected that everybody across the supply chain must be able to handle both new and old NDC numbers seamlessly. It is the same product, it's the same drug, but one box may be marked with a 10-digit, another one may be marked with a 12. To us, it's the same product. We just have to make sure our systems and our processes can accommodate both and recognize that they are the same product.

References

1. US Food and Drug Administration. National Drug Code format. FDA website. Accessed September 23, 2026. https://www.fda.gov/drugs/electronic-drug-registration-and-listing-system-edrls/national-drug-code-format
2. US Food and Drug Administration. Revising the National Drug Code format and drug label barcode requirements. Final rule. Fed Regist. Published March 5, 2026. Document No. 2026-04368. Accessed September 23, 2026. https://www.federalregister.gov/documents/2026/03/05/2026-04368/revising-the-national-drug-code-format-and-drug-label-barcode-requirements