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Sean Milmo is a freelance writer based in Essex, UK.
Pharmaceutical companies and their contractors are reorganizing their manufacturing lines and logistics to ensure compliance with the serialization requirements, but many SMEs are struggling to meet the deadline.
The European pharmaceutical sector is bracing itself for the introduction early next year of a European Union scheme for the serialization or identification of individual packs of medicine. There are increasing worries that pharmaceutical manufacturers, particularly small- and medium-sized producers (SMEs), will miss the deadline on 9 Feb. 2019 for compliance with the serialization regulation. More significantly, organizations responsible for running the project at the national level may not have the IT infrastructure in place for doing their job.
Medicine manufacturers are working hard to modernize packaging lines in their production plants with new printing presses, real-time monitoring systems, and software necessary for the serialization of drug packs and for the connecting of labelling information with data repositories at national and European hubs. They may, however, find on 9 Feb. 2019 that the national repositories and their connections with pharmaceutical production plants are not fully operational.
“It is quite likely that the whole serialization system across Europe will not be ready to meet the deadline in February,” said Bart Vansteenkiste, global life-sciences business development manager at UK-based Domino Printing, a serialization specialist in printing and coding. “The European hub is ready, and individual countries such as Germany have their repositories operating with countries such as the United Kingdom, Netherlands, and Scandinavian states not far behind,” he told Pharmaceutical Technology Europe.“But a large proportion of countries look at the moment unlikely to meet the deadline. There is still a lot of work to be done.”
The Belgium-based European Medicines Verification Organization (EMVO) at the centre of the scheme’s European hub has been uploading the serialization data of pharmaceutical manufacturers for distribution around those national verification organizations (NMVOs) ready to receive it. The pharmaceutical industry is hoping that with the EMVO being so well prepared, the worst-case scenario of countries not having their IT infrastructure operating on time will be avoided.
“The countries, which at the moment are behind schedule, will be doing whatever they can to be ready by the deadline,” said Johan Verhaeghe, national policy liaison manager at Medicines for Europe, the Brussels-based trade association for generics and biosimilars producers. “They don’t have any other option but to get things done on time,” he explained to Pharmaceutical Technology Europe.“The 9 February deadline is written in the text of the serialization regulation, which has been transferred into the national laws of each of the EU’s 28 member states. If they don’t keep to the deadline, they will be breaching their own national laws.”
The serialization scheme is being introduced under the EU’s Falsified Medicines Directive (FMD) of 2011 to combat counterfeiting of drugs through a regulation (1), issued in 2016, which lays down specific safety features for medicines packaging. The main requirement of the regulation is that the packaging should carry a unique identifier comprising a product code, a serial number based on a randomized algorithm, a reimbursement number required by countries in which the medicine is marketed, a batch number, and expiry date.
The unique identifier has to be encoded in a two-dimensional barcode within a machine-readable data matrix that can be accurately decoded using common scanning equipment before the medicine is dispensed to the patient. The printing of the two-dimensional barcode has to be of sufficient quality to ensure accurate readability of the data matrix for at least one year after the expiry data of the pack or five years after the pack has been released for sale. In additional to the unique identifier, the pack’s safety features have to include an anti-tampering device, although the nature and quality of the device is not stipulated by the regulation. An important requirement laid down in the regulation is that the repositories system for the storing and verification of serialization data are to be set up by the manufacturers and marketing authorization holders (MAHs) with each repository being established and run by non-profit legal entities.
In addition to the EU’s 28 member states, the regulation will also be applied in Norway, Iceland, and Liechtenstein-which are non-EU states. Switzerland, another non-EU country, is introducing it as a voluntary measure. The UK plans to implement the regulation even though it will be leaving the EU at the end of March 2019.
Among the drug manufacturers in Europe, research-oriented multinationals seem to be in the most advanced state of readiness for the regulation. “[Our] members are on schedule to deliver the coding and serialization on their medicines packs in line with the regulation by the deadline of 9 Feb. 2019,” says a spokesperson for the European Federation of Pharmaceutical Industries and Associations (EFPIA), a high proportion of whose members are large R&D-based international producers. Such proactivity is not unexpected because serialization schemes are being introduced across the world so drug companies with extensive international operations would tend to be at the forefront of the switch to individual pack identification.
Cost of compliance
For many SMEs, however, compliance with the FMD regulation is turning out to be a much bigger challenge in terms of administrative and managerial resources and above all costs. The total costs of adopting all of the 10,000 pharmaceutical production and packaging lines serving the EU market is estimated to be €5 billion (US$6 billion), according to figures from Medicines for Europe, Verheaghe pointed out at a Paris conference on 5 Apr. 2018, organized by Adents International, a serialization system specialist (2). Installing a new packaging line could cost up to €500,000 (US$600,000) (2). The cost of setting up the European Medicines Verification System (EMVS), comprising the EMVO and NMVOs and their infrastructures, will be €90 million (US$108 million), while its annual running costs will be another €90 million, said Verhaeghe (2).
Suppliers of serialization equipment and software are warning pharmaceutical manufacturers that time will soon be running out for the installation or re-equipping of packaging lines. “It can take at least six months to install and integrate a serialization system,” says Vansteenkiste. “As a supplier of the printing and coding facilities, we have to work with partners such as cameras and software suppliers. If there is a rush of companies wanting serialization systems, the suppliers will not have enough capacity to cope. They are already fully booked.”
An indication of the level of preparation among manufacturers has been figures from EMVO (3) showing the number of pharmaceutical companies that have uploaded data with the organization on all the licensed products of their MAHs in Europe. The data are provided for security reasons by a special corporate legal entity called an on-boarding partner (OBP), which will be responsible for all its company’s information being handed to the EMVO including that from contract manufacturing organizations (CMOs) and third-party logistic providers (3PLs).
By March 2018, approximately a quarter of 2000 pharmaceutical companies covered by the regulation had become OBPs and had uploaded details of their MAH products to the EMVO. “The on-boarding figures are still far behind schedule, while the deadline is getting closer,” EMVO admitted when announcing the OBP figures. The OBP data would be passed on to NMVOs with whom MAHs would have fee-paying agreements to handle the verification of their individual medicine packs from the time they are released to the market through to the dispensing of the drug to the patient.
Some states are lagging behind in the complicated process of setting up national verification organizations with data repositories connected with the serialization operations of pharmaceutical plants, as well as with wholesalers, pharmacies, and other dispensing points.
Although the NMVOs are being established and operated by trade associations and other groups representing manufacturers, the NCAs are also deeply involved in their activities. They have the job of ensuring the NMVOs comply with the FMD regulation, which even gives them the right to sit on the organizations’ management boards.
The EMVO has also been helping with the formation of national verification organizations through the introduction of a standard verification scheme. As a result, manufacturers and other stakeholders do not have to start from scratch when building a national system, according to Verhaeghe. The European verification organization also announced on 26 Apr. 2018 that the Czech NMVO had become the eight national organization to link up with the European hub, with another 10 that are due to do the same by the end of July 2018 (4).
Nonetheless, the weak point in the serialization network emerging across Europe is the connectivity between the MAHs with national verification systems. The integration or “on-boarding” of the MAHs is “far behind schedule” with 50% of countries appearing to be “too late for the February 2019 deadline,” Verheaghe said (2).
NCAs can help make serialization easier by limiting their right to require specific safety features, such as reimbursement data on barcodes, and showing a willingness to accept items like multi-market coding. “It helps generic manufacturers, for example, to have few specific national requirements for the same product,” Verhaeghe explained to Pharmaceutical Technology Europe.“If a product has a different status in each country, then that could require different packaging lines. Many countries now understand the need for a smooth transition to serialization with as few national specifics as possible.”
Hopefully, by next February’s deadline, all the verification systems and their data repositories should be operating. The pressure for compliance will be intense. The vast majority of drug producers should also have their serialization processes working effectively. But for a few, particularly generic-drug manufacturers, the expense in terms of money and human resources will have been so high that they will have had to withdraw low-margin products from the market.
1. European Commission, Delegated Regulation Laying Down Rules for the Safety Features Appearing on the Packaging of Medicinal Products for Human Use, Delegated Regulation 2016/161 (Brussels, February 2016).
2. J. Verhaeghe, “Where Will FMD Lead Us?’” Presentation at Adents Serialization Innovation Summit (Paris, April 2018).
3. EMVO, “Announcement-500 participation agreements signed,” Press Release, 12 Mar. 2018.
4. EMVO, “Announcement-One Additional Country Connected to EU Hub,”’ Press Release, 26 Apr. 2018.
Pharmaceutical Technology Europe
Vol. 30, No. 6
When referring to this article, please cite it as S. Milmo, “Meeting the EU Serialization Deadline,” Pharmaceutical Technology Europe 30 (6) 8–9 (2018).