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MR. TAYLOR: It's about 1:35. If you recall, we ended with Panel 3, and so I want to welcome the members of Panel 4, and thank them for their indulgence in light of the fact that we had to continue after lunch. We're going to make a point of ensuring that everyone gets to speak this afternoon. However, we are going to ask that you keep to your allotted times in order to help move things. And Panel 6 in particular is one that has an enormous number of people.
I also want to remind you that even though we're committed to having everyone speak who is on the agenda, the vendors will need to be out of the room by 5 o'clock, so vendors just FYI, you're going to have to move out your wares.
The first speaker on Panel 4 is Alan Goldhammer from Pharmaceutical Research and Manufacturers of America.
MR. GOLDHAMMER: Thank you very much, John, and it's Alan Goldhammer. I'm Associate Vice President for Regulatory Affairs at PhRMA. We're pleased to be here to present today on what we think are some critical issues for patient safety. I think that was a theme that you heard echoed throughout the morning, and certainly is one that we will keep to as well. I will try to go quickly over some of the points that were covered by earlier speakers, because I think there were some common themes that you heard, while saving time to amplify on those issues that PhRMA believes to be particularly important.
I think as everybody is agreed so far, there's no single approach or technological magic bullet to anti-counterfeiting, and PhRMA strongly believes that a systems approach is necessary that involves both technology approaches as well as improved regulations. And ultimately a closed distribution system is the system that best assures product authenticity. And as we will touch on in some of the latter slides, stiffer criminal penalties and improved regulatory approaches are definitely needed.
In order to assure product authenticity PhRMA member companies already--and I think this is a point that wasn't stressed earlier today--are employing both covert and overt approaches, both in terms of formulation development, as well as in packaging. Some of the covert approaches that involve taggants or forensic analysis are particularly useful in assessing authenticity. However, they do not permit real time authentication, so if a pharmacist has questions when he opens the bottle, those technologies are not going to be useful in that setting.
In terms of overt approaches, companies are using special printing features. Tamper-evident packaging is being widely used. However, and the theme that we have heard constantly, is there is the need to rotate solutions, and in particular, probably on a 12-month horizon. So you're then faced with the question, what does the pharmacist see as these features start changing? Are they going to have to go back and look up and see, well, do I look for a color changing ink in this case or a new hologram here? It's still going to cause some problems at the workplace.
Track-and-trace was identified a little earlier. I think everybody believes that when this is fully employed it represents our best attempt to ensure authenticity. However, there are some major hurdles that need to be overcome. We will need to have serialized identification on all packaging units so that when the pharmacist dispenses they can close out the database for that particular serial number. It can be done with barcode under existing technology, and I know that my good friend, John Roberts, will be on a later panel, and he'll talk about some of the work that the Uniform Code Council has done.
RFID technology has been mentioned. The Commissioner has mentioned it. I think a lot of folks are excited about it. Again, there's a lot of work that is going to need to be done.
The second bullet here, as I already noted, a need for an open standard, and then I think a critical issue here is the information technology infrastructure that is going to be needed to record each transaction.
And the ultimate final bullet her is the time and cost of implementation and a lot of question marks here. We don't know how long it's going to take to implement this down to a single packaging unit. I'm not talking about bulk packaging at either the case or pallet level which maybe can be done a little quicker, but that's not going to provide I think the security that we need to look at the whole chain.
We have heard from one of our manufacturers that they distribute--and this is a worldwide figure--a billion package units per year. So even if you get the cost of RFID chips way, way down, this is still a lot of money on a yearly basis for a manufacturer to be investing.
The bottom line it--and I'll touch upon this a little bit later--is, well, there is a need for an interim paper pedigree requirement to track transactions.
I'd like to now turn to some of what we call the regulatory issues here, and there are four principal ones here: finalizing the PDM pedigree requirement, strengthening licensing requirements for wholesalers, addressing repackaging requirements, and increase penalties and enforcement activities for counterfeiting. And again, some of these we've already heard from from previous speakers.
PhRMA feels very strongly, and I think we stated so at the Part 15 hearing, John, that you chaired, I think it was back in 2000. So we're almost three years now, that the pedigree requirement should be implement. We realize it's been stayed. However, drug pedigrees do serve two very important purposes. They prevent introduction of counterfeits into the supply chain and they facilitate the recall of counterfeit products.
PhRMA believes--and I think if one goes back and reviews the congressional record on this that the final rule is an accurate reflection of congressional intent and will help prevent counterfeits from entering the drug supply.
In terms of the pedigree what has changed since the law was passed? We're already heard there have been an increased number of FDA counterfeit investigations. We know that there's an increased sophistication of counterfeiters. Even sophisticated holograms can be replicated within six or seven months time. There are increased health risks to the public if they get a counterfeit product, and one only need turn to the Florida Grand Jury report, which took an extensive look at what was going on in the state of Florida in terms of counterfeiting, and their conclusion was that there's a strong need for a pedigree requirement to deter counterfeiters, and here is some language from the grand jury report, and I would also note that PhRMA was very active in the discussions that went on in the state of Florida to strengthen their state regulations.
The options to strengthen the effectiveness of the pedigree is to have a universal pedigree that requires all wholesale distributors to pass pedigrees along including authorized distributors, so this would address one of the issues that a speaker raised earlier, and secondly, to require pedigrees to be passed to all customers including retail pharmacies. And then verification to require purchasers to verify the authenticity of pedigrees.
In terms of wholesale licensing--and again we heard a significant amount of this earlier this morning--this is done at the state level. We have 50 states so there are 50 different sets of requirements, and in some cases enforcement may be lax. Again, this was extensively dealt with by the Florida Grand Jury, and there were significant problems there which have been corrected with the stronger state regulatory approach. And it may be perhaps that federal standards for wholesaler licensing need to be strengthened.
PhRMA believes very strongly that there need to be efforts to deal with repackaging. Recent counterfeiting investigations have involved such operations, and there are two key points here. Repackaging poses a risk to product quality because the repackager may not use the container closure system that is in the original NDA and which was studied exhaustively by the manufacturer, so it could present some issues with regard to product deterioration. And secondly, if we are going to move to implementing some types of anti-counterfeiting technologies on packaging, the simple act of repackaging will negate anything that the manufacturer might have done in that regard.
So PhRMA believes strongly the FDA should reassess policies regarding repackaging in light of this threat, and if the Agency decides to move in the direction of requiring anti-counterfeiting technologies to be included in packaging, that repackagers should be subject to the same requirements, that is, whatever the packaging technologies that are decided on as the original manufacturer.
In terms of increased penalties and enforcement, this was discussed by the first panel. We also believe that it would be useful to take a long, hard look at the criminal and civil penalties for counterfeiting and strengthen those. Again, this was noted, that the penalty for drug counterfeiting is three years, and as we say in the third bullet here, there is significantly greater criminal penalties for distributing elicit drugs than there is for the counterfeiting of legal drugs, which actually put patients' health at risk.
The penalties for counterfeiting a pharmaceutical should be commensurate with the significant public health threat posed by the counterfeit drugs, and sufficient to deter counterfeiting activities, particularly those that are carried out by organized crime.
In conclusion, PhRMA believes that all the stakeholders need to have a primary focus on patient safety. We're working on the task force that HDMA has convened to look at electronic track-and-trace simply because we believe that this represent probably the best approach, but we have a number of trading partners, the distributors, the pharmacies, and then ultimately the patient, that we all need to keep part of this as we move forward, so that patient safety is not compromised.
I thank you for the opportunity to present today.
[Applause.]
MR. KUBIC: Good afternoon. My name is Tom Kubic. I'm the Executive Director of the Pharmaceutical Security Institute, and I'm pleased to join my colleagues in discussing an issue of growing importance to all Americans. I also want to join my colleagues in thanking the FDA for hosting this hearing. As you look at your anti-counterfeiting initiative, it's clear to me that there is much work to be done.
Because of the limited time I'd like to focus my comments on four areas that I believe are critical to a successful anti-counterfeiting effort, those being the opportunities and limits of technology. I'd like to discuss some best business practices currently being employed by the manufacturers, talk a little bit about the improved or the need to improve information sharing, and then close with a discussion about some recommendations for an improved and enhanced FDA effort at international investigations.
In late 2001, in order to strengthen their response to the growing threat of counterfeiting, 16 research-based pharmaceutical manufacturers came together to establish the current PSI. The goal of PSI is to support its members in their efforts to ensure the distribution of pharmaceuticals that are safe and effective. PSI's mission is to collect, analyze and disseminate information about counterfeiting, theft, as well as diversion of medicines. This information is then shared with the appropriate authorities here in the United States and in other countries throughout the world.
Echoing some of the earlier comments about the global nature of counterfeiting, in fact, in the 2002 PSI situation report, we did find counterfeiting as having been identified in 32 countries. For the first three-quarters of the fiscal year 2003 that number has risen to 36 countries and I think that this trend is entirely likely to continue as the well organized counterfeiting groups expand and develop further their illegal operations.
The increasing number of investigations undertaken by FDA is just one indicator of the success of counterfeiting organizations and these are just the instances that we currently know about and have been able to identify. Counterfeit, mislabeled, diluted, expired and contaminated drugs have entered the American pharmaceutical system because in part the market is such an irresistible lucrative target to these organizations, and also in part because of the dispersed distribution system.
I was also pleased to see the FDA's interim report clearly stated that there are limits to each and every technological fix. There simply is no single technological solution to counterfeiting. Criminal organizations and their associates will continue to adapt to any new anti-counterfeiting solution that is proposed. They'll continue to copy overt markings. They'll continue to refill vials. They'll continue to over label packages, and they will continue to seek coconspirators who will accept counterfeit packages irrespective of the lack of appropriate packaging or pedigrees.
However, the use of technology, when combined with stricter enforcement of the counterfeiting laws, as well as stricter penalties, can form the basis for a comprehensive approach to help deter counterfeiters. PSI members have and will continue their efforts to incorporate the latest in appropriate anti-counterfeiting technologies in both their packages and their products.
For example, in September of 2003, 100 percent of the PSI members responding to our survey stated that they are actively studying the issue of new technologies for packaging. In the past year alone, over 59 percent had introduced new packaging security devices, and over 92 percent were planning on introducing new packaging security devices in the next 12 months.
While it's good to note that the members are continuing to improve package security features, they also fully understand the nature and the ingenuity of the counterfeiters. In a most telling statistic, over 72 percent of our members reported that based on their previous experience and investigations with the counterfeiters, individual packaging security devices did not and could not have prevented the particular problem.
I wanted to mention briefly two best business practices currently employed by our members. Each one of the members has a standing internal cross-disciplinary committee which is comprised and brings together personnel from the security department, quality assurance, quality controlled units, as well as the legal department and product packaging experts. Whenever there is a counterfeiting incident which has occurred or is suspected, as weaknesses are identified, suggestions for improvement are promptly developed.
Secondly, each PSI member has dedicated personnel responding to the problem of counterfeiting. On a daily basis these experts work closely with law enforcement and health care authorities throughout the world by monitoring and quickly investigating any complaint by a patient, pharmacist, physician, that a drug may be counterfeit. They monitor and return packages of medicines as well as suspicious packages that are on the market to ascertain possible signs of tampering. They then provide critical information on their products and efficiently assist law enforcement whenever requested to do so.
The investigation and prosecution of suspected drug counterfeiters, whether in the U.S. or abroad, is significantly improved by the timely exchange of information. Prompt information exchanges allows for the efficient allocation of enforcement and investigative resources, and ideally, the seizure of counterfeit products before they enter the supply chain.
From the manufacturer's perspective we need to know the specifics of the counterfeiters' modus operandi. With this information we can strengthen those weaknesses that are exploited.
PSI also agrees with the FDA's call for American stakeholders to work with foreign stakeholders to better coordinate their anti-counterfeiting efforts. In fact, every PSI member has pursued anti-counterfeiting initiatives around the world, as security staffs frequently interact with their counterparts in a support of law enforcement efforts.
PSI has staff permanently assigned abroad and works closely with Interpol's Intellectual Property Action Group. But there is a need to reinvigorate the U.S. Government's effort at the identification and dismantling of these criminal organizations that have targeted the United States' markets. Since these organizations are in fact internationally based they are outside of the reach oft times of the FDA. Without a presence in key manufacturing countries the investigative components of FDA is in a constant defensive and reactive posture. To improve their effectiveness, PSI believes that FDA should take immediate steps to establish an investigative presence in key foreign source countries. Only through the full-time posting of agents from the Office of Criminal Investigations to counterfeit pharmaceutical source countries will the financial structure, the transportation route, the distribution points of these organizations be fully identified.
In closing, PSI believes that the FDA's multi-pronged approach to addressing the criminal problem of pharmaceutical counterfeiting, as outlined in the task force report, is comprehensive and well-reasoned, but additional improvements can be made in the three areas I mentioned.
Firstly, substantial information sharing should be put forth as one of your priority efforts. A high-level commitment from all the stakeholders with regularly scheduled information exchange is needed to advance this initiative. Secondly, we also join, as some of the other speakers have mentioned, in the need for more aggressive enforcement of anti-counterfeiting laws and tougher criminal penalties against counterfeiters and lastly, it's our belief that the FDA should assign more investigative resources abroad in these key foreign source countries where the counterfeiting organizations exist. In these regions the U.S. leadership and support is immediately needed.
Thank you.
[Applause.]
MR. DEMPSEY: Good afternoon. My name is John Dempsey and I'm Executive of Trade Relations and Brand Security for Ortho Biotech. Ortho Biotech is Johnson & Johnson's biotechnology company.
Some of the folks here in the room, Tom McGinnis, Jim Cohen, and a few back in the audience, have seen bits and pieces of this presentation, but I wanted to go over and provide to you the experience that we had as a company when we first discovered counterfeit drug in the marketplace, and the format will be what it was like, what happened and what it's like now. So we'll give you some firsthand experience of what we did and the security measures that we decided to implement on the teamwork that occurred between Ortho Biotech and the FDA and the Office of Criminal Investigation, and what drove all of us, J&J, Ortho Biotech, OCI and FDA, in reaching the solution that we reached, and also talk a little bit about what we see as short-term solutions and then long-term solutions in terms of some of the new and exciting technologies that are out there in the marketplace that have been mentioned previously.
On or about May 20th we received a phone call that was probably one of the worst phone calls I ever received in my career, and that was to let us know that FDA had found some product in a distribution warehouse in Grapevine, Texas that was of a suspicious nature. We believe that the initial investigation a Medicaid fraud investigation, but that because the product--there was no paperwork associated with it, this caused FDA and OCI to suspect that there might be something more to this case than just Medicaid fraud, and in fact, the product was sent out to Amgen to be analyzed. There were 1,004 vials that were analyzed. And just to be clear on this, Amgen manufactures PROCRIT for Ortho Biotech, and we market it in the United States for all non-dialysis usage.
It was in fact confirmed that the 1,004 vials that had been discovered were in fact 2,000-unit product that had been relabeled as 40,000-unit product. We immediately had a conference call with the FDA to discuss and identify our next steps, and that was a very large team that consisted of FDA, Amgen and J&J along with Ortho Biotech.
On the 30th an internal core team was established. And I give this information to you because if there are other pharmaceutical companies out in the audience, I think this is important. The process that we went through is one that you might benefit from and might be able to implement yourself.
But our internal core team was a small team, and it consisted of myself, trade relations and brand security, communications, our medical department and our legal counsel. That core team also consisted of a representative from the FDA, and that was Jim Cohen. I just want to take an opportunity to recognize and acknowledge the work that Jim Cohen did as we worked through this very, very difficult process that involved phone calls late into the evening, work on the weekends, and without Jim's team and the work that he did, we could not have successfully addressed this issue in the marketplace.
On the 31st we produced to FDA our timeline, and communicated to them what the month of June would look like.
Now, just to give you some of the things that we were up against at this point in time, number one, anything that we did we would have to do in conjunction with Amgen. We were not the manufacturer of the product, so in order to do anything and implement any security features in the packaging we would have to present a case to Amgen and then present a case to the FDA that would allow us to pull the product out of our current inventory and redress that product with the anti-counterfeiting technology features built into it.
Keep in mind that we also were not approved at that point in time in New Jersey, none of our sites were approved to redress product, and because of speculative buying that occurred in the previous year, we had about $1.2 billion worth of product in inventory.
J&J had also decided that none of that product would go out into the marketplace until it had some type of anti-counterfeiting technology built into the packaging.
So there was a number of issues that we had to deal with, and we decided that, very simply, that we would be guided by our credo, and FDA, ourselves, we all knew what was of utmost importance was customer safety and satisfaction for the patients that we service.
So it became very easy for us, after we identified that this product was out in the market, the process that we had to follow.
So we did, from June 1st until June 22nd, we had continuous proactive communications. We sent out over 400,000 different letters, two separate "dear doctor" to the health care providers letting them know what we had discovered. We had discovered two separate lots of counterfeit product that had been labeled as PROCRIT, both of which had been 2,000 unit relabeled as 40,000 unit. Our redress was a cross-functional team that consisted of packaging, quality, manufacturing, engineering, operations, shipping, legal and trade relations. And I think that hats off to this team and what they accomplished.
In order to build a case, working with the counsel of FDA to allow us to go in to create a manufacturing line to take product out of inventory, to unpackage it, and then to redress it, and to be able to present that case to FDA and have FDA approve it, obviously we couldn't have done it without their great cooperation, insight and counsel. So, hats off to the team.
We decided during the process that our platform, our basic platform in the initial development of our brand security program would be security ink, and we were going to go with carton closure seals.
From the 1st until the 22nd we had daily meetings, conference calls with the FDA to let them know how the plan was progressing, and to let them know when we thought the redress would be completed.
I have to chuckle when I look at that, it's one bullet point, because trust me, it wasn't one bullet point from June 1st to June 22nd.
On the 22nd the redress activities actually began on the first lot of our 40,000 unit product, and on July 1st that first lot was shipped out of our Franklin Distribution Center with the carton closure seals and the security features built into it.
On August 29th the complete $1.2 billion worth of product had been completely redressed.
So when we look at different types of brand security plans, I think from our standpoint, obviously people have already spoken about overt features, covert features, we also added some features that are both covert and then become overt in some of the adhesive seals that we have on our product.
This is what a carton closure seal looks like. We have a color-shifting ink similar to what was used with the U.S. Treasury Department on the $20 bills. We go from a green to a gray. We also have covert features that are built into the security inks, which I won't go into detail about, but I can tell you that our district managers can go to an end user's office, to a hospital pharmacy, to a wholesaler, or to a hospital and authenticate product at the end user's place of business. And that's the covert feature.
I'll also say that there's been some conversation about how sophisticated the counterfeiters are, and they are very sophisticated. One of the covert features that becomes overt on our carton closure seal is that when you remove the seal initially we had a pattern on the adhesive where it would say "Void," and it would say "OBPLP" when you removed the seal, and we felt very comfortable that that was another feature that we built in that would be difficult to replicate. Well, nine months we had put the seals on the cartons, fortunately, through an informant, FDA and OCI conducted a sting operation, and this was the product that we found. And the counterfeiters had reproduced a very unsophisticated version of the carton closure seal. They didn't have the adhesive indicator on the back, but they did attempt to reproduce the seal. So that addresses one of the issues.
When you talk about a security program, it has to be fluid, it can't be static. It has to have many features that are both overt and covert, and certainly complacency is the greatest threat that you'll face. For us, we had the carton closure seals, we had the security ink, we had the covert features that were built into those carton closure seals. We then took all of our caps and foil wraps and we color-coded them to the specific strength of our product. On our foil wraps we built in covert features that identify the strength and the name of the product.
And this is an example of the different colors in the caps and the foil wraps that are used on our vials. For those that are unfamiliar with PROCRIT the vial is about this big, so about an inch high.
In addition we now have covert features, actually overt and covert features that are built into the individual unit vial so that they also can be authenticated at the end user level by our district managers.
Key learnings. Complacency will kill you. You've got to have a comprehensive security program and you've got to have many components and many layers. Neither the program nor the threat is static. If you sit still, you can be guaranteed that counterfeiters are not sitting still, and that they're looking for a way that they can counterfeit your product and make money.
Communications have to be transparent from the very beginning. I urge anyone who's in the pharmaceutical industry that if you discover this, be as transparent as you can. Let everybody know. Call the FDA, enlist them as your partner. Set up your websites. Link your websites to the FDA's website. Over communicate as much as you can. We had eight different mailings, 200,000 mailings for each time that we sent out. We had, I believe, the first mailing Jim probably had six or seven pages and it included color photos that showed the difference between authentic versus counterfeit product. On our website we have the authentic versus counterfeit product pictures also, and that can be seen at www.procrit.com.
The effectiveness of any security program rests on your weakest link. You constantly have to do your threat and vulnerability assessments. Meticulous management of the supply chain is paramount.
And I have to say two things that we did. In three of the eight communications that we sent out, we told our direct distributors--those are those customers that we sell our product directly to--that if they're caught with product purchased from a source other than Ortho Biotech, they would lose their direct account status with us. And in an industry where 2 percent, 30 days is very important to generate revenues, that had some impact.
A second piece of that communication was we solicited and asked all of our customers that utilize PROCRIT to let us know if they ever receive mailings or faxes from a source other than Ortho Biotech to purchase PROCRIT, and I'm happy to say that on a number of occasions we did receive phone calls to that effect. We were able to pass those on to FDA and OCI and successful investigations occurred. I'm unhappy to say that the frequency of those phone calls was very, very small.
So I think there's an issue there that we all need to take a look at in terms of responsibility and accountability. The reason that counterfeit drug gets into the marketplace is because someone's willing to buy it, and if flyers are out there suggesting that product can be purchased at a price that's below market price, then there's probably something wrong with the product.
The cost and benefits are not always quantifiable. It's difficult to put a dollar and cents figure on them, but at the end of the day, what's most important is patient safety, and cost is not an issue when that's taken into consideration.
And this is our icon on our website. Thanks very much.
[Applause.]
MR. THERIAULT: Good afternoon. My name is John Theriault.
Since 1996 when I joined Pfizer as Vice President of Global Security a significant portion of my time has been devoted to developing and implementing a robust anti-counterfeiting program. The basis for that program lies not only in Pfizer's desire to maintain public confidence in the Pfizer name and the integrity of our products, but also to safeguard public health and safety. So I would like to thank the FDA for this opportunity to express Pfizer's views on the FDA's anti-counterfeiting initiative, and the importance of that initiative in ensuring the integrity of the U.S. pharmaceutical supply.
My comments today are going to focus on two related areas, how the FDA and the pharmaceutical industry can work together most effectively to protect that supply, and our recent experience with counterfeit Lipitor as a case study in the effective management of a threat to that supply.
Lipitor is the largest-selling pharmaceutical product in the world. As many of you may know, a substantial amount of counterfeit Lipitor was recently discovered in the U.S. distribution system. Investigation into the sourcing and distribution of the counterfeit Lipitor disclosed a large-scale international operation involving as many as 16 companies in nine countries. It was in fact a very sophisticated well-organized international criminal enterprise.
The counterfeits were apparently manufactured in Brazil or Argentina. They were introduced into the U.S. by repackagers who commingled the product with authentic product and distributed it to pharmacies throughout the United States via the secondary wholesale network. At the end of the day over 18 million tablets had to be recalled.
The original Lipitor case came to our attention as a result of consumer complaints that were received and investigated by Pfizer. The number of complaints, fewer than 20, represent only a tiny fraction of those who take Lipitor on a daily basis. And an examination of this photograph, if you can see it, may explain why there were so few complaints. Visually the counterfeit tablets on the left are virtually impossible for a consumer to differentiate from the authentic tablets on the right.
As this case developed Pfizer and the FDA were in almost daily contact. While the primary contacts were between Pfizer's Global Security Unit and the FDA's Office of Criminal Investigations, there was also frequent contact between Pfizer and FDA laboratories. As Pfizer received sample from those consumers who had filed complaints, the samples were tested and found to be counterfeit. We not only shared with the FDA our test results, but also provided them with samples necessary for them to conduct their own analyses. Our security unit also coordinated the verification of lot numbers, expiration dates and distribution of the lot numbers that were called into question.
For its part the FDA worked closely with Pfizer to ensure that once a recall was issued, the public would be promptly informed of the nature and extent of the recall. The FDA issued talk papers that not only informed the public of the recalls but also reassured those taking Lipitor that it was only the tablets repackaged by a certain company that were subject to recall.
Also when it became clear that a recall was imminent the FDA provided Pfizer with notice, thereby permitting us to put in place our own plan of action to inform and reassure our customers. The steps that we took included the issuance of a press release, posting and updating information on our Lipitor website, preparing a detailed Q&A to provide accurate and consistent information to the media, health care professionals and patients, and an informational fax that was sent to pharmacists throughout the country.
To ensure the success of the FDA's anti-counterfeiting initiative we feel that attention must be given to three particular areas: government and industry cooperation in preventing the introduction of counterfeits into the U.S. pharmaceutical supply; prompt and coordinated reaction to counterfeits that are discovered; and strong remedies against those responsible for counterfeit activities.
Regarding prevention. We agree that packaging should be developed to permit counterfeits to be more readily identified. To accomplish this goal the FDA should provide flexible guidelines for implementation by the industry. But technology alone is not the answer. It should be viewed as one important part of a multi-layered solution.
Those involved in the distribution channels for pharmaceuticals must also be made active participants in ensuring the integrity of the supply. They must improve business practices to authenticate and track products, and stricter penalties must be imposed upon those willing to jeopardize public health and safety by engaging in reckless business practices that facilitate counterfeiting.
To ensure the success of these measures there must be a greater commitment of resources, not only by the FDA but by state regulators as well. Current regulations must be strictly enforced. Wholesalers and repackagers should be regularly inspected to determine their compliance with existing laws and regulations. The industry must also be alert for signs of counterfeiting through enhanced product surveillance and close monitoring of distribution channels.
I can't over-emphasize the importance of open and frequent communications between the FDA and the industry. In the event of a serious counterfeiting threat these communications can be facilitated by designating points of contact and establishing briefing schedules. In order to facilitate its investigations the FDA requires information concerning our products, our packaging and our anti-counterfeiting technologies. Given the proprietary nature of that information, however, it's necessary to have in place a system to ensure the confidentiality of that information.
We also believe that a more efficient method to inform and educate the public must be developed and implemented. Key components of any system should include a coordinated FDA industry process for disseminating information concerning recalls. Examples of such solutions could include the use of Internet websites and the mass faxing of information to pharmacists as proved so successful in Pfizer's management of the Lipitor recall.
Finally, Pfizer remains committed to aggressively addressing the counterfeiting problem. We will maintain our proactive surveillance of the market through consumer relationships and global security to identify and investigate possible sources of counterfeit Pfizer products. We will seek to forge a strong partnership with the FDA and other enforcement agencies. A training program recently held for a joint task force from the FDA OCI, the FBI and local police is a first step in forging a strong partnership with the FDA to ensure that the pharmaceuticals dispensed to U.S. residents are authentic, safe and efficacious.
Again, thank you for the opportunity to comment on this very important FDA initiative. Thank you.
[Applause.]
MR. TAYLOR: Any questions for the task force?
MR. McCONAGHA: I've got a very quick question, if I may, for Mr. Goldhammer.
MR. TAYLOR: Bill, just before you go on, just in case there are people who--
MR. McCONAGHA: I'll identify myself. Bill McConagha with FDA's Office of Chief Counsel.
Mr. Goldhammer, I have a quick question for you. Does your organizational membership have a view with respect to unit-of-use packaging?
MR. GOLDHAMMER: We don't have a firm view yet. It has been discussed and there are some potential drawbacks to it. Mention was made earlier about the use of blister packs as one approach. There are a couple of key points to be noted about that. (A), it is widely used in Europe, and there also large numbers of blister packs have been counterfeited in Europe, so it's not a panacea in that respect.
Also, in the United States we have the Poison Prevention Act regulations that have to be complied with, so every blister pack has to be evaluated for each drug. You can't just say, "We've got a blister pack and we're going to use this for our whole line." It's got to be evaluated on a drug-by-drug basis.
And the final point is, for drugs that have multiple dosing regimens, you really run into a problem. Take the example of antibiotics where you have a 7, 10, 14, 21-day dosing regiment. How do you blister pack those? It's going to be complicated and pharmacists may end up having to carry multiple inventories.
MR. McCONAGHA: Thank you.
MR. TAYLOR: Any other questions?
MS. BERNSTEIN: Yes. Ilisa Bernstein from the Office of Policy.
I have a question for Mr. Kubic. In the survey that you did, did you by any chance survey and ask people what they think about in terms of when they're going to institute anti-counterfeiting technologies, what kind of factors they consider? Because if you recall, in the report we had a question about that, so I was wondering if you can comment on that at all?
MR. KUBIC: The survey that was conducted by PSI did not go into the detail in terms of what types, and we did ask within the next 12 months who was interested or who had a work in progress that looked as if in 12 months they would have something new online, and that was the basis for that number.
MS. BERNSTEIN: And in fact, if anyone else wants to comment on that, that would be--
MR. DEMPSEY: John Dempsey. In terms of other companies, I think the thought is, after hearing what we had to present and what my fellow peer at Pfizer had to present, if you're a pharmaceutical company and you're not looking at implementing some type of brand security program now, you might want to reconsider that.
MR. TAYLOR: Yes, Terry?
MR. VERMILLON: Yes. I'm Terry Vermillon. I'm Director of the Office of Criminal Investigations.
Mr. Dempsey, I was just wondering, in the injectable market, I wonder if the industry has started looking at any kind of technology that would preclude the reuse of vials, so it would be a single use vial, where after it was used it could n longer be reused?
MR. DEMPSEY: I think from our perspective there's a number of different technologies that we're looking at both in vials. We also have examples of products that are out there that are delivered in a syringe. From our perspective I wouldn't want to comment on what we're looking at or what we're thinking about doing, but certainly the technology is evolving and the technology hopefully will be there.
When we look at what's out in the future, and I didn't comment about this in my presentation, but many folks here today did talk about radio frequency identification tags, and I think from the standpoint of the future and what the future holds, I think there's two things that RFID provides to us as an industry and to the customers that we serve. One is the anti-counterfeiting technology that it can afford. It's very difficult to duplicate. We can authenticate product at the end user level. But then the secondary piece that that provides to the industry on the supply chain side are supply chain efficiencies in terms of inventory management, reverse logistics, data collection.
Whether or not FDA gets to the point where they mandate a program going down that path, the only thing that I would say is we had barcodes out now for 20 years--40 years. And when have they become fully implemented in the pharmaceutical industry? So I think there's an opportunity for all of us to come together and look at this new evolving technology and make a decision that this is that this is the direction that we want to go, and certainly if the masses come to the table, then the cost of the technology will be insignificant.
MR. TAYLOR: Any other questions?
[No response.]
MR. TAYLOR: Okay. I want to thank the fourth panel very much.
[Applause.]
Table of Contents | Introduction | Panel 1 | Panel 2 | Overview | Panel 3 | Panel 4 | Panel 5 | Panel 6 | Panel 7