Editor’s note: This article is the second in a three-part series.
The Food Safety Modernization Act (FSMA) has kept the grocery supply chain buzzing about food safety during the past year, and it will continue to do so in the future as the regulations are ­released.

Editor’s note: This article is the second in a three-part series.

The Food Safety Modernization Act (FSMA) has kept the grocery supply chain buzzing about food safety during the past year, and it will continue to do so in the future as the regulations are ­released.

Like FSMA, Title II of the Drug Quality Security Act (DQSA), known as the Drug Supply Chain Security Act (DSCSA) is also hailed as the most sweeping change in years, but in this case for the drug supply chain. It was enacted to improve the security of the U.S. pharmaceutical supply chain through regulations that will increase visibility to the distribution of drugs.

DSCSA outlines critical steps required to build an electronic, interoperable system that can identify and trace selected prescription drugs as they are distributed through the pharmaceutical supply chain.

The act goes one step further than FSMA by setting a 10-year time line in motion as well as providing the government and industry with guidelines to build a system that will facilitate the exchange of tracking information at the individual package level. Drug manufacturers, wholesale drug distributors, repackagers and many dispensers (primarily pharmacies) will be called on to work in cooperation with the Food and Drug Administration to develop this new system.

The law requires the FDA to develop standards, guidance documents and pilot programs, in addition to other efforts necessary to support efficient and effective implementation of the law. Failure to comply with the requirements can result in penalties.

As a federal act, supersedes all state laws, and while implementation of the law is being executed in phases by industry sector, many companies have already started working on initiatives and/or have initiated pilots in preparation for ­compliance.

Similar to FSMA, DSCSA aims to protect consumers by enabling product verification, improving the detection of suspect products through facilitating product recalls. Earlier this year, one of the early phases of DSCSA implementation began. Its focus was on the foundational requirement that pharmacies buy drugs only from companies that are authorized under DSCSA. Today, the term “authorized” is defined by DSCSA as "holding a valid license."

Counterfeit products are a primary concern for the World Health Organization, which estimates counterfeits enter the drug supply chain between 1% and 10% of the time, with some countries hitting the 50% mark.

Besides authorization, and like FSMA requirements, DSCSA also demands that trading partners in the pharmaceutical supply chain capture and maintain product ­information.

While the FDA requires two years history for documentation related to food, information for drugs must be maintained for not less than six years after the date of the transaction.
Dispensers or pharmacies that wait to implement a technology solution will be relying on their upstream trading partners to help them comply with DSCSA, which can leave them at risk.

Although DSCSA allows product tracing information to be exchanged through paper in certain circumstances, there are significant business, cost and compliance reasons to leverage technology and cloud-based systems.The FDA believes that product tracing information serves as an important tool for dispensers and pharmacies, enabling them to meet their obligation under the law, to quickly identify suspect product, to quarantine the product and to investigate whether that product is illegitimate.

Not only can a paper-based system slow tracking drug movement through the supply chain, but shipment errors and increased staff time may put regulatory compliance in jeopardy.

Like the food supply chain, time is of the essence in identifying suspect products in ­pharmaceuticals.

The impact of these new laws and regulations is causing both food and drug retailers and suppliers to revisit their approach to mitigating risk and protecting their brands and their customers. FSMA requirements focus on documenting compliance with several regulations, and DSCSA focuses on tracking drugs through the supply chain. To meet regulatory requirements, food and drug retailers and their suppliers will need an automated solution that supports both records and traceability requirements and gives greater visibility into the source and quality of products being sold to consumers.

Randy Fields is chairman and chief executive officer of Park City Group, a cloud-based software company, and he is a founding collaborator in ReposiTrak, an Internet-based solution that helps participants in the farm-to-table supply chain with records management and regulatory compliance. Fields can be reached at [email protected].