Serialization and Pedigree Initiatives:

Why Now?

White Paper
March 2009

by:
Brian Daleiden
SupplyScape Corporation

Dr. Yun Kang

SupplyScape Corporation

Abstract
California’s pedigree mandate for serialized drug products and electronic pedigrees, combined
with expected federal regulations in this area and continued growth of serialized product
identification mandates in the European Union, China and elsewhere, creates significant
challenges for companies across the pharmaceutical supply chain seeking to prepare their
business and their trade networks. In examining this uncertain environment, this white paper
explores the diverse business, technological and trading partner interoperability issues faced
by companies in developing an actionable strategy to ensure full regulatory compliance and
lay the foundation for driving future business value.

© 2009 SupplyScape Corp, All Rights Reserved

Introduction

“Many drug supply chain participants have expressed great concern in their ability to be
ePedigree [pedigree + item-level serialization] compliant by January 1, 2011. To give the
pharmaceutical industry the necessary time, flexibility, and guidance to comply with
California law, I introduced SB 1307…” “SB 1307 now has the support and commitment of
the entire pharmaceutical drug manufacturing and distribution chain to begin compliance
with the ePedigree law beginning on January 1, 2015…”

The above statements by CA Sen. Mark Ridley-Thomas regarding his bill that reset the
timeline for California pedigree regulations, created for many, a sense of relief or stay-of-
execution from the impending and burdensome requirements of the California serialized
pedigree law. For many companies, when looking into the particulars of the legislation and its
impacts on a pharmaceutical supply chain business, that initial relief has subsequently
transformed to a realization of the complexity and magnitude of the challenge to ensure full
internal and trade network compliance.
The issues become even more complex for those companies with operations that span
throughout the United States or extend to other regions such as the European Union, Latin
America and the Asia-Pacific rim. Firms with operations across multiple regions face a
diverse mix of serialization and regulatory reporting requirements that also need to be factored
into internal planning processes.
The problem is slightly different for each segment of the pharmaceutical supply chain, yet the
solution for each is highly interdependent upon the actions of the rest. When viewed as a
whole, the convergence and urgency of challenges within the supply chain requires the
collective energy of all participants to avert the risk of business disruption, ensure full
compliance with regulatory requirements, and provide a collaborative foundation to drive new
business value from what appear on the surface to be cost-of-doing-business investments.
This white paper explores the challenges faced by companies as they seek to build fully
compliant business operations in the face of serialized product and pedigree regulations being
created by California and elsewhere. The analysis draws from multiple perspectives within the
pharmaceutical supply chain and further provides key strategies that serve to mitigate the risk
of failure in this endeavor.

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Why Now?

Current California pedigree requirements significantly expand the scope of pedigree and
serialization compliance to broadly cover prescription drugs moving through the supply chain
in California. Emerging federal mandates add a potential expansion of this requirement to all
drugs moving into and through the United States supply chain. Instead of the previous state-
by-state selective response in use, these new mandates have now driven an all-encompassing
business reality for firms at all points in the pharmaceutical supply chain including drug
manufacturers, wholesalers, and pharmacies along with the manufacturer service providers
such as contract manufacturers, contract packagers, 3PLs and returns organizations.
Drug manufacturers must now strategically plan and execute serialization capabilities for
dozens of production and packaging lines affecting hundreds and thousands of SKU’s.
Wholesalers face a considerable number of new variables to contend with. Serialization
constructs, carrier technologies (linear barcode, 2D barcode, RFID), carrier application (unit,
case, pallet), mixed pedigrees (serialized and non-serialized SKU’s), integration with a high
volume of upstream and downstream trading partners, and a subset of downstream partners
that require enablement solutions from the wholesaler are but a few examples of the
challenges facing the wholesaler. Pharmacies and other end points, much like the wholesaler,
are faced with the complexity coming at them from the upstream with the added caveat of
limited budgets and resources that affect their ability to develop solutions.
From the collective viewpoint, the supply chain struggles with timelines barely long enough to
allow acquisition and deployment of serialization and pedigree technologies, alignment of data
and business processes, adequate interoperability testing, and the lead time necessary to fill the
supply chain with compliant product.
One way to break down the issue is to bisect the supply chain and its challenges into two parts,
companies that are just starting compliance projects in one category and companies that are
already implementing compliance solutions in another.
Each category must rationalize their go-forward plans differently and ask different questions.
Companies That Are Just Starting are asking questions about timing and complexity…
ƒ How soon do I need to start?
ƒ How do I prioritize and sequence activities?
ƒ Who should be involved with the team?
ƒ What are the risks that will impact my project timelines?
Companies That Are Already Implementing Solutions have a greater sense of urgency and
concern for the timeline and are asking questions in that context…
ƒ Do my current business strategy and operational plans fit with the emerging
requirements or do they need adjusting?
ƒ Do I need to accelerate my project?
ƒ Will my trade partners be ready to test interoperability?

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It is apparent that the two categories are juxtaposed where companies just starting exhibit a
greater tendency toward hesitation while companies already implementing seem to grasp that
time is of the essence with so much work to do. This misalignment represents risks to the
supply chain in terms of readiness and the flow of product.
While there are many challenges with these expanded mandates, there is also a silver lining.
Companies who act in a timely fashion will be able to turn the compliance project into a
strategic business enabler. The result is new business value and improved ROI based on the
greater utilization of data and processes versus a siloed single-function point solution.

The Global Perspective

Additionally, for many companies it is prudent to take a broader survey of the global
serialization and pedigree landscape. Numerous countries in Europe, Asia, and South America
either have mandates in place or are considering new mandates which require various versions
of product serialization. Some of these requirements are focused on the product security
aspects where serialization can help provide product traceability while others are focused on
processes such as reimbursement which require serialization to assist with precise execution.
The variety and depth of these requirements is beyond the scope of this paper, but firms
should take a close look at these specifications and how they impact the development of a
successful, long-term, and flexible corporate strategy in this area. Failure to do so may result
in either unexpected new investments in these areas and/or reengineering of corporate and
supply chain processes to meet new requirements. In addition, the maximum potential value
created by the leverage of pedigree and serialization investments in other business operational
areas such as procurement, inventory management and brand management can only be
realized when a strategically developed operational plan is used.

Select Global Serialization and Codification Requirements

Complex and Expanding

Italy Korea – Codif.

Belgium Japan – Codif.
Turkey Brazil
Greece Spain
China Russia
Ireland Germany
France – Codif. Serbia
US – CA / (Fed) Libya

In place Proposed

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The Path to Compliance: Manufacturers
Prior to the California regulation changes, many companies had adopted a ready, fire, aim
approach to compliance by picking a solution that would achieve the end-goal and doing their
best to integrate that solution in to existing business processes. Many acknowledge that this
improvised approach was short-term in nature and would evolve over time after achieving
initial compliance. With the current deadline, companies now have the ability to be more
strategic with their approach to compliance and have a much better chance of deriving full
business value from their investments – if the time is used wisely.
What follows is a strategic approach and framework for serialization and pedigree compliance
projects that takes into account the timelines, and where necessary, breaks out different
considerations by supply chain segment. The initial context of information is from the point-
of-view of the drug manufacturer, but given the dependencies and synergies among
manufacturers, wholesalers, and pharmacies, the approach and considerations are applicable
for all with a subtle shift of viewpoint. As a framework, this approach is not individualized
enough to serve as a project plan per se, however it does provide a foundation for the
development of that strategy and plan.

Critical Timeline Dynamics

In order to assemble a timeline and see how much time an organization has to get ready for
compliance, we must first understand some of the key dates that a company faces in meeting a
targeted compliance deadline. Given a set deadline, wholesalers and other downstream
customers will require that fully serialized and pedigreed products to be sent in advance of that

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date. In the past, this typically could have been 6 months in advance or longer in order to fill
the downstream supply chain with compliant products.
However, manufacturers should not misinterpret this requirement as meaning that they must
start serializing product only 6 months in advance of the deadline. This is due to their own
lead times required to fill the internal supply chain with compliant products. Thus, at least 6
months prior to the deadline, all the inventory of non-compliant products needs to be
purged out and every product within the internal supply chain (packaging site
warehouses, distribution center warehouses, etc.) needs to have serialization and
pedigree. A good assumption is that this will require 3 months to occur, but it will vary based
on the weeks or months of inventory companies hold within their internal network. As a
result, the date when serialized products emerge from packaging lines differs from product to
product, and it depends on the production schedule (especially for slow-moving products).
The point here is that when taking into consideration all of these lead time elements,
companies may need to be producing serialized product fully a year or more in advance of
compliance deadlines, thus considerably shortening the time for building serialization and
pedigree capabilities. This issue is particularly crucial as wholesale distributors,
anticipating a rush of new serialized product coming from their suppliers, start
scheduling fulfillment slots for the intake of new serialized and pedigreed product. Thus
a given manufacturer’s slot may be well in advance of the latest possible distribution date.

Determining Serialization Launch Dates

The next strategic determination is the date when products coming off of the packaging lines
are required to have serial numbers. This is accomplished by analyzing and decomposing
each product into its lead time components.

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Using an example above with a channel fulfillment deadline of 1/1/2014, we next look at how
much inventory is kept within the company network including the inventory at all packaging
sites and distribution centers. This can vary from a couple of weeks to several months of
inventory. Next, there is the manufacturing and packaging lead time which, assuming a fairly
sizable batch could be 1 month or longer. Companies should apply a safety factor, such as 1
month’s time, to provide a buffer for any unknowns that may be encountered. Products
coming from overseas must also be accounted for in the time required to clear international
customs. Subtracting the total of these lead times from the wholesaler deadline provides the
latest possible start date for serialization launch.
However, this is not necessarily the date when the packaging lines, sites, and distribution
centers have to be ready for serialization. There are other factors that play into this, one of
which is the product schedule. Not all products are packaged every week, and for slowing
moving products, companies need to look at the production schedule and if it is earlier than
the ‘Latest Possible Date for Serialization Launch’, then it becomes the constraining time.
Only then can the serialization launch date be set which is the date that each packaging line
producing the product needs to be fully ready with serialization.
Another factor that can affect the serialization launch date is that most packaging lines have no
room for downtime. Many lines run close to 100% capacity and one cannot expect that a line
be taken down arbitrarily to fit it with new or modified equipment, configurations, and to
perform required validation testing. These lead time constraints must be accounted for in
setting the launch date.
When completing this analysis, companies not only gain insights into the timeframe by which
they need to be ready with serialization and pedigree, but may also be surprised to find that the
launch date may be far earlier than anticipated. In this case, full production readiness may be
needed as early as 2012.

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Solution Strategy Development and Planning

Once milestone dates are understood, companies need to develop their strategy and roadmap
for serialization and compliance solutions.
Typically this consists of:
ƒ Regulatory requirements interpretation.
There are key issues surrounding regulatory requirements that need to be addressed
first before making other decisions. Questions such as ‘Who is considered the
Manufacturer?’ and ‘What transactions have to be on the pedigree?’ need to be
answered in order to appropriately drive future plans. This is especially true for
companies using contract manufacturers and 3PL’s where these questions take on
critical meaning and where it can take a long time to sort these issues through.
ƒ Prioritize the serialization efforts.
Chances are that the ‘big bang’ approach to getting all sites ready for serialization
carry undue risk of failure. For this reason, companies need to carefully look at all the
factors and prioritize the investment and resources intelligently over the entire rollout
period. ‘Which sites need to go live first with which products, and based on what
rationale?’ are critical questions to be answered.
ƒ Develop timeline for implementation.
Companies have varying requirements for all the activities during the implementation
phase. Some companies have different requirements for installation, configuration,
testing, validation, training, etc. A master project plan is necessary to capture all the
activities and durations so that the senior management team can be presented with
accurate estimates on the deployment timeline.

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 ƒ Develop cost and resource estimates.
Based on the phases defined and the scope of the rollout, estimates need to be
developed as to the costs for software, hardware, and services associated with the
project. It may be helpful to further break down this information by capital vs.
expenditure. Closely tied to the cost estimate is understanding which resources with
what skill-sets are required. If resources from an external solution provider will be
utilized to build pedigree and serialization capabilities, then it is still important to
identify the required internal resources having the right expertise to mobilize and work
jointly with those external teams.
ƒ Define internal approval process.
Though all the requirements are clearly identified and preferred vendors are chosen,
getting the internal approval for budget and resources can be a time-consuming process
especially for track and trace initiatives where the scope of work tends to be rather
extensive and where commitment from many different functional areas of the
organization are required. Developing the right messaging, communication, and
obtaining internal alignment from all the stakeholders should not be underestimated.
Collectively, the information garnered during the planning phase along with project phasing
and resource requirements will yield a project charter that will be submitted to the
management team.
Other factors affecting the Strategy Development and Planning timeline include:
ƒ Number of lines and size of supply chain network
ƒ Alignment with partners on legal requirements and deployment timelines
ƒ Incorporation of global serialization requirements
ƒ Dynamic/changing nature of supply chain network
ƒ IT landscape changes
ƒ A prolonged vendor selection and contracting process
ƒ Internal and external resource constraints

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Solution Design and Implementation

Once vendors are chosen and internal approval completed, the design and implementation
stages begin. Internal team members collaborate with vendors on the design of processes that
are impacted by serialization and pedigree at the packaging and distribution sites and architect
the software and hardware systems.
Once design is completed, acquisition of equipment, hardware, and software, begins, followed
by installation and qualification. Subsequent ‘build’ activities would occur including
configuration and customization of installed software and hardware and development of sub-
system communication interfaces. Finally, a procedure would be documented for use in
multiple rounds of testing and validation of the systems.
Given the difficulty in enabling all sites for serialization and pedigree simultaneously,
companies typically phase their efforts. Phase one might entail a limited deployment; setting
up the platform and infrastructure for pedigree and serialization along with enablement of a
limited number of sites. The next phase would be an enterprise-wide rollout to include and add
the remaining sites. The deployment model described here is for a small to medium size
manufacturer with several packaging sites, less than a dozen packaging lines, and several
warehouses.
The timeline for this one phase of implementation (there may be multiple) for a small to
medium size company may be a year or two in length. Working against the key required dates
when serialization and pedigree have to be ready, companies may find that they cannot wait
for the first phase to complete before starting the next phase. Multiple phases will need to run
concurrently due to these timeline constraints.
Other factors affecting the Design and Implementation timeline include:
ƒ Serial number constructs and application

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 ƒ Label design and approval
ƒ Product stability testing (if RFID is to be used)
ƒ Internal and external procurement lead times
ƒ Vendor competency
ƒ Complexity in use-cases and business process design
ƒ Integration with legacy systems
ƒ Integration with partner ecosystem

Trade Partner On-Ramping

Thus far, design and implementation has been discussed in the context of internal
considerations. However, significant consideration must be given to ‘connecting the pipes’ or
trade partner on-ramping with upstream and downstream trade partners. Some of the key On-
Ramping activities with partners include:
ƒ Deciding what will be sent and when
(e.g. pedigree only or pedigree and serialized ASN)
ƒ Deciding how it will be sent and understanding the IT capabilities of each trading
partners (e.g. FTP, AS2, etc.)
ƒ Coming to agreement as to what will be used for each data element in the pedigree
ƒ Resolving serialization interoperability issues with trading partners
ƒ Obtaining and setting up all trading partner profiles in internal systems

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 ƒ Determining testing schedule and approach
ƒ Conducting testing and resolving issues
What makes on-ramping such daunting task is the need to perform the above tasks with
every supply chain trading partner. The number, complexity, and sophistication of trade
partners cannot be underestimated. Interoperability data alignment, interface design, and
testing may have an impact on the implementation schedule equaling that of serialization and
pedigree.
Factors to consider when planning for trade partner on-ramping:
ƒ Number and type of trade partners
ƒ IT readiness of trade partners
ƒ Alignment of data expectations
ƒ Alignment of legal interpretation of requirements
ƒ Transition plan from non-serialized to serialized products

Summary for Manufacturers

For manufacturers, adding up all the individual corporate decisions, rollout timeframes, and
coordination requirements across the trade network points to a compliance timeline which
may be significantly constrained even with deadlines years in the future. Assumptions were
made in this framework relative to small or medium-size manufacturers, and unique
manufacturing scales and trading partner network complexities must be a consideration as
companies apply this framework to their own operations. For much larger organizations there
would be greater challenges; more phases may be needed to be built in parallel and supported
with additional resources. Lastly, the scenarios presented here are best-case; therefore
adequate contingencies must be included to account for unexpected disruptions and keep the
timeline from being in jeopardy.

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The Path to Compliance: Wholesale Distribution Considerations

Wholesale distributors will leverage a similar rollout approach and grouping of tasks as
manufacturers would. The key difference is that distributors typically have many more
trading partners to work with – both upstream suppliers and downstream customers.
Additionally, the sophistication and dependent nature of trade partners will vary. Some
upstream suppliers will have solutions that require integration. Other, smaller upstream
manufacturers or downstream partners may lack technical sophistication and have no solution
or plan. These trading partners often look to the distributor as a solution provider. As a result,
the trade partner on-ramping effort will be considerably greater and the timeline substantially
longer.
Another key area of challenge for wholesale distributors is the diversity of incoming shipment
profiles from suppliers. Distributors are subject to a varied number of serial number
constructs, data carrier technologies, and applications schemes - some suppliers will be
sending pedigrees at the item or case level and others at the pallet level and all combinations
in between. Designing and implementing a solution that is flexible enough to accommodate
these schemes today and into the future is time-consuming and has great bearing on the project
timeline.
In summary for wholesale distributors, the complete serialization and compliance planning
horizon is similar to that of manufacturers although the individual processes affected vary
considerably. Once again, the distributor considerations stated above were in the context of a
moderately-sized wholesaler and therefore are also subject to scale in timeline and resources.

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The Path to Compliance: Pharmacy Considerations

In many ways, individual pharmacies and pharmacy chains are faced with the same challenges
as wholesale distributors as they relate to the diversity in shipment profiles. The caveat and
complexity for the pharmacies lies in the large number of end points that require
implementation of a compliance solution. For the pharmacies, this exceeds the data alignment
and interoperability requirements that define the challenge for the manufacturers and
wholesalers. There may be dozens or hundreds of end points where implementation of the
compliance solution must take place. Often, there is variability among those end points in
infrastructure, equipment, and support resources, all of which when combined, can make each
end point a one-off implementation of the compliance solution.
The design and implementation plan of a serialization and compliance solution for the
pharmacies has its own unique complexities even if the overall timeframe may be shorter than
other segments. For the pharmacies, there will be overlap in the project plan for assessing the
variability of its end points, making technology decisions, and executing deployment
activities. Deployments are likely to be grouped in order to complete the enterprise
implementation in time. Smaller pharmacies and other end points such as hospitals, clinics,
doctors’ offices, etc. may be look to their wholesale suppliers for guidance and partnered
solutions. Finally, pharmacies must be mindful of their position at the end of the chain and the
delays in interoperability testing this will cause as they wait for suppliers to be ready.

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The Importance of Serialization and Pedigree Together

After the California State Board of Pharmacy extended the deadline, many companies have
taken pause to consider their strategy and next steps. One of the key questions being asked is
about the sequence of serialization and pedigree. Which should come first? The answer is
that both need to be implemented jointly for the following reasons:
PEDIGREE REQUIREMENTS DRIVE SERIALIZATION DESIGN.
The ultimate goal of implementing pedigree and serialization solutions is to enable
creation and/or processing of pedigrees with serial numbers in them. Implementing
serialization is by no means easy. However, the effort expended to change business processes
and systems at the packaging sites and warehouses is to ensure one final successful output: a
pedigree with all of the serial numbers and hierarchical information captured in it. For this
reason, a best-practice for each company in the strategy and planning phase is to fully
understand the exact legal and regulatory requirements as they specifically apply to their
organization.
Understanding the serialization requirement seems rather straight forward. That is, at the time
when final packaging is done, a unique identifier must be assigned to the product. The greater
debate and investigation revolves around the pedigree component. Many organizations have
already determined the pedigree requirements. For example, “Who has the responsibility to
generate the pedigree?” “Where do pedigrees originate?” “Which party signs the pedigree?”
And, “What transactions have to go on the pedigree?” The answers to these key pedigree
questions will determine how serialization will be implemented. For example, if an external
party will generate the pedigree on your company’s behalf, should that party also own the
serialization system, or should your company own it? If the legal interpretation and
application of pedigree requirements are not taken into consideration, then the risk of
serialization redesign increases and threatens to extend the timeline.
USE-CASES AND BUSINESS PROCESSES FOR PEDIGREE AND SERIALIZATION ARE
TIGHTLY INTERTWINED.
In the future, production floor processes will have to account for products that have pedigrees
and serial numbers. For example, when warehouses receive inbound product, they would
initiate a receiving process that would first verify that serial numbers on the product
identification label are correct and that a valid, matching pedigree exists and can be certified.
To properly enable this transaction, an organization would need to construct a comprehensive
process that meets both pedigree and serialization requirements and that accounts for the
transition points and dependency for both the pedigree and serialization systems.
These requirements extend beyond the inbound receiving process. Consider receiving returns
from downstream partners that would require handling serial numbers and pedigrees. During
outbound shipping, systems and processes must ensure that the serial numbers are captured
and associated to transaction information as well as trigger either creation or updates to the
pedigree. During cycle counting, serial numbers and pedigree inventory need to be accounted
for. When handling exceptions such as over-shipments and under-shipments, serialized
pedigrees require stricter process accountability.

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For these reasons, it would be impossible to design and roll out serialization independent of
pedigree due to the integrated nature of these processes.
THE IT ARCHITECTURAL DESIGN FOR COMPLIANCE IS EQUALLY AFFECTED BY
SERIALIZATION, PEDIGREE, AND LEGACY SYSTEM INTEGRATION.
The architectural design of the serialization system will be impacted by:
ƒ Where in the process pedigrees are generated
ƒ What transactions have to be added to the pedigree
ƒ When and how pedigrees are received from trading partners.
For example, pedigree system requirements will impact the feasibility of a centralized system
to generate and issue serial numbers and where that system will be located in the overall
design. Also impacting the IT architectural design are the interfaces that need to be built
between the serialization system, pedigree system, and legacy systems. As a result, the
recommended approach would be to architect the overall system jointly for pedigree AND
serialization.
INTEGRATING WITH TRADE PARTNERS REQUIRES PEDIGREE. Serialization
provides the requisite product identification but pedigree provides the vehicle for compliance
as well as the connectivity to trade partners. Conveyance of serialized product for both
upstream and downstream trading partners is dependent on the pedigree system and the degree
to which that system is integrated with internal business processes. Additionally, the pedigree
system provides alignment of data and business processes between trading partners and given
the magnitude of the trade partner on-ramping effort cannot be deferred without dire
consequences to the project timeline.

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Additional Considerations

Will the Resources be Available?

One final area to consider as companies are reviewing their external requirements and internal
readiness is the area of required resources. The deployment of a comprehensive pedigree and
serialization solution will require a wide range of resources, both technical and human.
Computing capability (internal or SaaS-based), network equipment, software solutions of
various kinds, packaging or material handling equipment, and scanning devices (barcode,
RFID) are just some of the pieces that need to be put into place. On top of that, the human
dimension needs to be factored in. Business analysts, project and program managers,
implementation and integration experts, and other people will need to be enlisted into the
project development and deployment. Some of this expertise may be available internally but
often it will need to be brought in from elsewhere.
The key hidden challenge is that not just one company is competing for these required
technical and human resources. Across the entire supply chain, thousands of companies
(manufacturers, distributors, pharmacies, etc.) will be seeking to acquire the same set of
capabilities…on very similar timelines. So, the question that needs to be asked is: Will I be
able to acquire our necessary resources on the timeline we need? The substantial risk
entailed if the answer is “no” puts added pressure to get started early on project strategy and
development. Unless resources are locked in early, a company that decides to wait in its
project execution may find that it is left at the table empty-handed with nowhere to turn.

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Questions to Get Started

At the beginning of every key initiative there are important grounding questions to be asked.
A comprehensive and flexible pedigree and serialization initiative that incorporates all state
and federal requirements is no different and there are both strategic and tactical questions to
consider as a company gets started on a full compliance plan.
STRATEGIC
1. Have you defined a strategy for your serialization and pedigree compliance efforts?
ƒ Have you re-assessed the scope and validity of your strategy and plan in light of
recent regulatory developments?
2. Has a corporate sponsor and program management been defined?
3. Have you defined your charter and secured a budget?
ƒ Has the budget been revised to accommodate any modifications in scope?
4. Has a cross functional team been assigned to your compliance efforts?
5. Have you developed a phased master plan for serialized pedigree?
6. Do you have alignment with your upstream and downstream supply chain partners?
ƒ Have you reviewed the legal interpretation of regulatory requirements with your
trading partners?
7. Have you defined an IT strategy for integration with manufacturing, distribution and
partner operations?
8. Have you identified the technical (hardware, software) and human resources required
at each step of the timeline?
ƒ Do you know for sure that these resources will be available when you need them
given industry competition for similar resources?

TACTICAL
1. Have you defined user requirements for manufacturing and distribution processes?
2. Vendor Selection: Do you know what questions to ask of your vendors?
ƒ Have you selected a Serialization Management system?
ƒ Have you selected a Pedigree Management system?
ƒ Have you selected a Packaging Serialization Execution system?
ƒ Have you selected a distribution center serialization solution?
ƒ Have you selected a trading partner management system?
ƒ Have you selected a Systems Integrator?

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3. Have you identified the business requirements for selection of serial numbering
constructs?
4. Have you identified an approach on data carrier use on your labels? (e.g. RFID, 2D)
ƒ If RFID, have you performed readability testing on your products?
5. Is your vendor’s solution in production today with referenceable customers?
6. How confident are you in your vendor’s ability to deliver hardware and software
resources when required by your project plans?

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Conclusion

To conclude, the California State Board of Pharmacy’s decision to delay implementation of

the drug pedigree and serialization requirements has created, for many, a false sense of relief
from the time pressure to comply. The new CA requirements have brought with them an
expanded scope of serialization and pedigree compliance for all dangerous drug products
across the supply chain. In addition, recent federal initiatives have been taking their cue from
CA on the scale and scope of potential compliance requirements. Finally, for companies
currently playing in the international arena or seeking to do so in the future, strategy and
planning complexity rises by an order of magnitude.
For companies that have already begun their compliance initiatives, the time is now available
to successfully complete their projects as long as they continue making progress. The major
risk arises when companies look at current regulatory deadlines in isolation and put on the
brakes. Research makes it clear that delaying strategy development is just not an option for
most companies.
The path to compliance has many dynamics. It is important for companies to understand their
unique internal date drivers as they plan their projects. Risk factors exist in all phases of their
projects including strategy development, planning, solution design & implementation, and
trade partner on-ramping. Those risks span legal interpretation of requirements, business
process re-engineering, IT architecture design, technology selection, acquisition, and
deployment, and proper alignment with supply chain trading partners. Additionally,
attempting to fracture the serialization effort from the pedigree effort brings with it significant
downsides to the project due to interdependencies found in the majority of the aforementioned
areas of risk.
Why Now? The answer is fairly clear. Time is of the essence and in the near-term,
development of an effective and logical plan of action is the critical next step on the path to
compliance and success. If not now, then companies may want to ask themselves the question:
At What Risk?

To learn more:
• Email authors: bdaleiden@supplyscape.com
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