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Pharmaceutical serialization helps improvise supply chain and inventory management despite implementation challenges

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by Jaya Krishnan , Research Analyst, CAPEX & MRO
1 January 2017


Serialization is a standard that all pharmaceutical companies are expected to follow to have visibility and traceability in their supply chain. Until now, the only layer of defense against the counterfeit drugs is the packaging of the product.Now, manufacturers are racingagainst time toimplement serialization ahead of the deadline.This involves changing thelabeling and the process associated with it which will help the regulators track the drugs throughout their supply chain.However,implementing this has its own challenges and drawbacks. One of the major challenges is scalability where the serialization solutions should support the distributed operations across themanufacturing facility, distribution center, and warehouses.Serialization solutions have the potential to add yet another ongoing maintenance cost to companies. Additionally, the space constraints on the production line, space available on the product packaging for printingand the overall implementation costwill impact productivity. Also, factors such as technology, data and the packaging protocol also prove to be challenging for implementing pharmaceutical serialization.


An overview on pharmaceutical serialization:The distribution and supply chain for genuine pharmaceuticalsproductshave grownbigger, and every step along the supply chain offers another opportunity for counterfeiters. This is where Pharmaceuticalcompanies and governments worldwide believe that counterfeiting can be reduced significantly by implementing product serialization. Serialization requires a comprehensive system to track and trace the passage of prescription drugs through the entire supply chain. Serialization could potentially identify every product by a unique serial number in addition to the origin, shelf life and batch number for that product. This could potentially allow the product’s lifecycle to be traced from production, through distribution, and finally to the patient.

Some facts on the impact of counterfeit drug over pharmaceutical

  • The FDA (responsible US agency) reports the worldwide damage caused by counterfeit drugs at $35 billion annually
  • The annual growth of thecounterfeiting business is estimated to be about 20 percent
  • According to expert estimates, up to one million people worldwide die each year as a result of taking counterfeit drugs
  • In the emergingand developing nations, the UN WHO estimates that about 30 percent of all drugs are counterfeit
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