The best 'good guys' in pharma distribution

Pharmaceutical CommercePharmaceutical Commerce - November/December 2013

We’ve reported regularly on the actions of the National Assn. of Boards of Pharmacy (NABP;, most recently on their efforts to take ownership of the “.pharmacy” top-level Internet domain and as a continuing participant in the e-pedigree/track-and-trace debate which, at presstime, seemed to be on its way to resolution after years of industry and government wrangling. NABP is worth highlighting again, having just published a white paper, “Wholesale Drug Distribution: Protecting the Integrity of the Nation’s Prescription Drug Supply.”

More so than any other association, business entity or government agency, NABP seems to consistently recommend actions that are truly in the best interests of industry, healthcare providers and ultimately, the public itself. This is not to take away from the many other organizations that devote time and effort to improving public policy regarding drug distribution. But in nearly a decade of covering the intricacies of drug distribution in the United States, I can’t think of an organization that so routinely not only serves its members’ interests (and ultimately that of professional pharmacists) but also acts to anticipate upcoming concerns.

The .pharmacy situation is a good example. The Internet Corp. for Assigned Names and Numbers (ICANN) opened up its naming process for thousands of suffix terms that follow the “dot” in an Internet address over a year ago; following its own vetting process, ICANN is granting ownership of those suffixes (called “global top-level domains”). NABP, with funding support from several pharma companies and others, is offering to set standards for when a business entity can use the .pharmacy domain. There has been some backlash—groups outside the US have complained that NABP’s bid represents a US effort to control international drug distribution—but the NABP has won a preliminary approval of its application. Frankly, I’ll be a lot more comfortable with “.pharmacy” in NABP’s hands than in that of others.

In the US, NABP has created several structures that serve greatly to solidify the integrity of pharmaceutical distribution and dispensing. The Verified-Accredited Wholesale Distributors (VAWD) program is the gold standard for distributor practices; the Verified Internet Pharmacy Practice Sites (VIPPS) program is relied on by the major search engines to permit online pharmacy sales. Google paid a multimillion-dollar fine a couple years ago for its loose oversight of illegal drug dispensing, and when it turned to figuring out how to address the issue in a regulated manner, NABP’s VIPPS program was already there. NABP has also coordinated state-level data-sharing programs for controlled-substances dispensing. All this comes on top of its core activity of regulating pharmacy licensure processes, interstate license transfers, and continuing education programs.

About that new white paper (available on the NABP website)? NABP says that because federal standards allow for “minimal quantities” of drugs to be resold by pharmacies while not meeting general wholesaler requirements, a loophole exists for significant diversion of drugs. Other problems: “intracompany transfers” in an organization that is both a retail pharmacy and acts as a wholesaler; and virtual manufacturers and distributors—companies that legally own a drug product’s intellectual property (or the drug product itself), but never have physical possession of the product. These arrangements have been used in some cases to exacerbate the ongoing drug-shortage problem by enabling companies to ratchet up drug prices. NABP is in the process of amending its VAWD standard to address this.

NABP exists because of the unusual historical accident that pharmacies are state-regulated. The entire biopharma industry operates under the guidance of FDA and other federal agencies, up to the point where drugs are delivered to a pharmacy—and then state programs take hold. One can envision a scenario where NABP would be a more passive organization, “sticking to its knitting” of standardizing pharmacy licensure and avoiding all these other imbroglios. But the world is a better place for NABP’s efforts—keep them up!

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