Supply Chain Management: In the Cold

Counterfeiting, diversion and tampering, item-level tagging, and compliance are a few of the challenges that face the pharmaceuticals industry in the management of the supply chain. The industry is increasingly having to comply with regulation and to track their shipments to ensure that the latter have been transported under the correct conditions.

Highly susceptible pharmaceuticals products that must be shipped under a set of prescribed environmental conditions like temperature or humidity, pose another set of challenges. Any supply chain that deals with temperature sensitive material – either perishables or other goods can cause the product specifications to be irremediably altered by temperature. A failure at any point in the cold chain to meet those specifications can lead to losses, product returns, and extra freight costs.

Companies have been experimenting with sensor-equipped Radio Frequency Identification (RFID) equipment and tags to monitor and validate temperature throughout the cold chain. This allows the distributors and the end customer to verify that the products have all been transported under the required environmental conditions. Customer requirements might vary: some can specify that the ambient temperature be the measuring point, whereas others prefer to use the product temperature.

In some cases, the conditions under which the products must be kept are mandated by industry or governmental regulations. Increasingly however, the conditions are determined and enforced internally by pharmaceuticals manufacturers to maintain a high standard of quality and product safety.

Tried, but Still Testing

Aspects of the pharmaceuticals supply chain make virtually any type of track-and-trace solution complex and challenging. Pharmaceutical products use a supply path that is similar to those of other retail products, but drugs typically follow a more disjointed supply chain; they are often sold from one distributor to another to balance stocking levels. Multiple distributors or wholesalers may handle a drug before it finally arrives at a retailer or end user. Barcode-based systems may cost less in the short term, but have demonstrated shortcomings, compared to RFID.

RFID has the capacity to store larger amounts of information, can be read more quickly than barcodes and require less human involvement. Since RFID tags do not require a direct line of sight to be read, they offer the advantage of accurate, mass data capture.

Some major industry players have successfully deployed the technology to manage their supply-chain. In 2007 for example, Pfizer implemented a pilot program by installing tags on all saleable units of Viagra. Other initiatives however, have found it hard to get beyond the concept and trial stages.

Mirroring the challenges faced by suppliers scrambling to meet the compliance requirements of the major retail RFID mandates set by Wal-Mart, Metro and others, pharmaceutical companies face obstacles, some of which are unique to the industry. These challenges include:

• Reading inlays from a distance;

• Reading many closely positioned RFID inlays/labels – in some cases, this could be due to the size of the tagged products, which could range from small vials, to bottles, drums, boxes, cases and other containers (this implies the need for RFID printing equipment that can encode to smaller tags, capable of limiting the antenna coverage area and reducing interference between adjacent inlays/labels);

• Achieving higher read rates through and in liquid environments;

• Achieving higher read rates on tightly packaged products

Enhancing Traceability with Electronic Pedigrees

In 2005, the World Health Organization estimated that more than 10 percent of medicine traded on the global market was fake. In developing countries, 25 percent was counterfeit or substandard. Because of the size of the pharmaceutical market – estimated to be well over US$500 billion worldwide and growing – and because of its cross-border reach, counterfeiting has become a multibillion-dollar problem. It has become a matter of public health and safety with the rising number of cases of people falling sick or worse after taking pharmaceutical products of suspicious origin.

The US Food and Drug Administration (FDA) stated as early as 2004 that RFID represents an important tool to help improve the safety of the drug supply chain. There have been various meetings to encourage industry players to collaborate in a pilot track-and-trace program based on RFID and related technologies such as mass serialization and electronic drug pedigrees. The idea was to have a system in place by the end of 2007. However, this has not materialized yet.

The initiative of the California Board of Pharmacy to combat counterfeit drugs by requiring an electronic pedigree on drugs was meant to spur the industry to develop standards for serialization. The proposal, originally set for implementation in 2007 in line with the federal goal, even warned retail pharmacies that they might not be able to receive drug shipments if the drugs did not carry electronic pedigrees from manufacturers.

However, delays in the system’s deployment have caused the implementation date for manufacturers to be pushed back to 2015, and an even later date for retailers. The FDA on the other hand has issued draft rules on tracking drug shipments through the system, with its 2008 proposal, “Standardized Numerical Identification for Prescription Drug Packages.”

Stronger requirements to safeguard the drug supply chain are on the way, including specific requirements for the cold chain. Many countries are pushing for legislation that will provide the oversight of pharmaceutical product tracking and tracing through the accumulation of a product pedigree, which details specifics about the supply chain history of each drug shipment.

Industry associations such as the US Healthcare Distribution Management Association (HDMA) are also promoting the accelerated adoption of electronic track and trace using Electronic Product Code (EPC) tagging. Plans are to target adoption at the case level initially and progress to individual selling units at a later stage as the system gains acceptance. At the same time, RFID standards groups such as EPCglobal are exploring the standards and practices that need to be established to adopt electronic track-and-trace technologies throughout the supply chain.

Keeping it Fresh

Perishable pharmaceutical products have a shelf life that is determined not only by time, but also by the temperature and other conditions in which they are stored. Retailers often have to use the FEFO (First Expire, First Out) concept to manage products that might have different shelf lives. Temperature variations can occur at various points in the cold chain, such as in warehousing, handling and transportation. A study by Deloitte discovered that "microclimates" not only occurred between the front and back of a refrigerated trailer but also within stacks of pallets. Results were somewhat surprising. In one test, the bottom pallets in the middle of the trailer experienced a nearly seven degree temperature variation.

The study used temperaturelogging RFID tags on pallets in both static and moving refrigerated trailers. It is a solution that has received some traction with those involved in the pharma cold supply chain. Companies are considering using temperaturelogging sensor-equipped RFID tags that can help to reduce waste in the perishable pharmaceuticals supply chain. Temperature is not the only issue though; humidity and shock can also play a role in affecting product shelflife. Some sensors can detect all of these conditions and more.

As companies acknowledge that RFID can help to eliminate waste in the cold chain, there is likely to be greater collaborative efforts to take advantage of these tools to improve performance and profit.

RFID technology is said to have improved the performance of the total supply chain in two key areas. Firstly, it can be used as a way to trace the geographical location of the individual cargo, container or truck, which can either be stationary or in motion. Sensors are installed at strategically located doors and gantries to track the movement of the container.

Information on the container such as date, time, location, and cargo number is picked up by the sensors at the gantry and is reflected in the central system or a mobile computer located in the proximity.

This method also enables containers to be tracked twenty-four hours a day. It is particularly helpful for companies that need their shipments to arrive at the desired destination by a specific date and time. If the shipment is delayed, information can be retrieved from the system to enable specific measures to be taken to speed up the delivery process.

Secondly, RFID technology is used to identify each item with a unique EPC. This is particularly useful for tracking specific items that require real-time data such as temperature. These data are then transmitted in real-time to another location where critical decisions (such as product recalls) can be made.

Savings and efficiency gains can be realized once an RFID system is in place. For example, the costs savings from tracking and reusing tagged shipping containers.

Up and Coming Technology

Containers that have been returned are inspected for their internal conditions before reusing. If the seal or lock is not broken and where no other visible damage on the outer container is detected, it is generally assumed that tampering has not taken place.

However, a more effective method is to perform checks at strategic points of transit to detect any damaged or tampered containers. The way to go about this is to enable batterypowered container units which are connected to the internet, and to monitor them real-time via a RFID-enabled system.

This type of usage is common for keeping track of cold chain applications, for example, the monitoring of refrigerated containers or reefers.

The RFID system for reefer monitoring is designed to provide companies with end-toend visibility into their cold chains – and to alert cold chain partners if the cargo is at risk of falling outside the acceptable temperature range. Custom-made devices are built into active RFID transponders that are placed inside pallets or containers before putting the latter into transit.

The sensors record and store information such as temperature and humidity. The information is transmitted via the tags to readers that are installed in the control center. The data is collected and shared centrally to allow all supply chain users to receive the same information simultaneously in real-time.

There are niche solutions that cater to this type of requirement. One of them is the Reefer Monitoring and Alert System (ReeMAS: Patent Pending Technology – PCT/SG2008/000261) that enables shippers, reefer owners, freight agents, shipping lines, port operators, and consumers to remotely monitor the reefer’s status via the internet. This non-intrusive system is capable of providing the monitoring of reefer containers onboard a land transport vehicle, vessel or in a container terminal.

This methodology allows the extraction of critical data remotely. If any discrepancies are detected, alarms will be activated by the reefer containers. On-site operators will be notified at the same time for immediate remedial action and the alerts can be communicated to the central operations via email or sms.

This system makes use of wired and wireless Mesh technology and/or satellite communication to provide remote monitoring capabilities with minimum setup effort. The acceptable temperature and humidity levels are set and form the benchmark.

Examples of tracked information include:

• Date taken

• Time taken

• Set temperature level

• Return air temperature

• Supply air temperature

• Set humidity leve

l • Humidity level

• USDA sensors • Reefer’s alarms

This cold chain end-to-end reefer monitoring system can operate in standalone or networked mode, linking the entire supply chain’s users from land and sea, and from fixed or moving locations.

Be Armed, Not Alarmed

Setting up a tracking facility surrounding container monitoring and control is not difficult provided that the key stakeholders recognize the key control points, key information to track, and the results of such controls.

When considering the purchase of a cargo security device or container traceability system, considerations include the provider’s expertise in accurate data capture and transfer, identification and tracking as well as meeting related requirements in challenging environments.

It may also be necessary to determine if the provider supplies hardware such as printers and scanners, and software such as label creation.

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RFID: A Primer

The RFID tag/inlay is basically a programmable tool consisting of an RFID chip for data storage. RFID tags are categorized as either passive or active. Passive tags do not have an integrated power source and are powered from the signal carried by the reader. Active tags have a built-in power source, and their behavior can be compared to that of a beacon. As a result of the built-in battery, active tags can operate at a greater distance and at higher data rates in return for limited life – driven by the longevity of the built-in battery.

Due to a lower cost of implementation, passive tags are a more attractive solution for some businesses.

The other component of the system is the reader system that serves to interrogate the tag and facilitate communication with the RFID chip.

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