The long-delayed drug pedigree regulations announced by the Food & Drug Administration in mid-November have evoked a storm of criticism and lawsuits. No one is objecting to the FDA's stated goal of reducing drug diversion and counterfeits, but the cure may be worse than the disease.

Rules designed to drive fraudulent distributors out of business will also hit legitimate wholesalers, said Carmen Catizone, executive director, National Association of Boards of Pharmacy. That could leave pharmacy buyers without backup when primary wholesalers can't fill drug orders.

At deadline, New York-based RxUSA Wholesale filed an injunction to block the new rules, which were slated to take effect on Dec. 1. "We have some real concerns with the final implementation," Catizone said. "If some legitimate wholesalers are forced out, it will impact product availability. In terms of securing the supply chain, it closes holes in distribution that were already closed and leaves open holes that were already open. Our frustration is not so much with the FDA response to counterfeiting as it is with the law it is trying to implement."

The law is the Prescription Drug Marketing Act (PDMA), passed by Congress in 1987 and modified several times since. Among other provisions, PDMA requires sellers to provide a pedigree, a statement of origin that identifies each prior sale or transfer of an Rx drug, including dates, names, and addresses of all parties to each transaction.

PDMA also provides an exception for manufacturers and authorized distributors of record, or ADRs.

The FDA has posted an enforcement guideline on-line and an industry guidance in question-and-answer format. Both guidances were announced by acting FDA commissioner Andrew C. von Eschenbach, M.D., speaking before a meeting of the Healthcare Distribution Management Association and the National Association of Chain Drug Stores in mid-November.

For larger wholesalers, pedigree rules mean more documentation. "Our plan is to be an ADR for all of the Rx products we are selling," explained Chris Smith, executive VP and COO of H.D. Smith.

The National Coalition of Pharmaceutical Distributors (NCPD) predicted the new rules would negatively affect 3,000 to 4,000 companies nationwide. "Pedigree needs to be universal, not something that carves out exemptions," said Gene Alley, president of specialty distributor Stat Pharmaceuticals in San Diego, Calif., and NCPD VP. The new rules perpetuate a major security flaw in the pharmaceutical supply chain, he continued. All of the major wholesalers have been hit by counterfeits, he explained. In many cases, counterfeit drugs were acquired by rogue employees. "Exempting ADRs from pedigree encourages that kind of fraud," he said. "It makes counterfeiting undiscoverable until someone has already been harmed. It's a patient safety disaster waiting to happen."

New rules also force pharmacies to rely on a primary wholesaler with universal ADR status. Relying on a single vendor leaves pharmacies vulnerable to product shortages and price hikes.

NACDS is less concerned because its members don't rely as heavily on secondary wholesalers. "This is a sea change," said Diane Darvey, NACDS director of pharmacy regulatory affairs. "Many players have moved away from secondary wholesalers."

Florida pharmacies have already seen what that means. The state started toughening pedigree regulations in 2004. About 65% of wholesalers that did business in Florida have left the state, reported Michael Jackson, executive VP/CEO of the Florida Pharmacy Association. The result, he said, is more drug shortages, especially in hospitals, and higher pharmacy acquisition costs overall.

"If your primary wholesaler is out of product, you don't have an alternative source any longer," Jackson said. "Losing so many secondary wholesalers reduces your flexibility."

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