An Industry Protection Bill Concealed Under The Veil Of Patient Protection

bird-and-fish-pattern.MCEscherImportant Notice To Readers of This Essay On November 27, 2013, President Barack Obama signed the Drug Quality and Security Act of 2013 into law. That act has many provisions, but one is to pre-empt all existing and future state serialization and pedigree laws like those that previously existed in California and Florida. Some or all of the information contained in this essay is about some aspect of one or more of those state laws and so that information is now obsolete. It is left here only for historical purposes for those wishing to understand those old laws and the industry’s response to them.There are two pharmaceutical track & trace bills making their way through committees of Congress, one in the U.S. House of Representatives and one in the Senate.  In both houses, these drafts are touted as bills to protect patients from the ill effects of illegitimate drugs in the legitimate supply chain, but, after reviewing the two drafts at length, I have concluded that the House draft is something else entirely.   Rather than focusing on protection of patients, the House draft is primarily intended to protect the industry from the California pedigree law.  “Patient protection” is little more than a veil to provide cover while the debate is kept on grounds more acceptable to the industry.

Here is my justification for such an assertion.  First, the House draft goes to great lengths to codify existing business practices and keep them unchanged for at least through 2027 and beyond, regardless of any new attacks that might be experienced between now and then.  These include the bulk of the text in the House draft, Section 2, “Pharmaceutical Distribution Supply Chain”.  I agree that many of these business practices are generally protective and deserve to be required rather than voluntary (see “The Built-in Protections Of The U.S. Pharma Supply Chain” and “Do We Even Need To Mandate Drug Pedigrees Anymore?”).  The problem is that it is pretty clear based on our experience over the last three years that this is not enough (see “How Counterfeit Avastin Penetrated the U.S. Supply Chain”, “Lessons from ‘Drug Theft Goes Big’”, “InBrief: Pharma Supply Chain Criminals Get Justice”, and “How Pedigrees Protect The Drug Supply: The Case Against Cumberland Distribution”.  Something more is needed beyond today’s common business practices to stop these kinds of crimes against U.S. citizens.

Second, the draft would require the federal government to perform a pilot, study after study and public meetings aimed at measuring how hard it is for the industry to add additional protections to the supply chain beyond those existing business practices, yet no studies aimed at documenting the extent of the targeted problem on patients.  If this were a true patient protection bill, and not just an industry protection bill, I think there would be a greater balance between studying the criminal attacks on the supply chain, the technologies needed to detect and block them and the burden on industry to adopt those technologies.  I encourage you to read the short Section 3 called “Enhanced Drug Distribution Security” in the latest House draft and see if there is any way you could imagine it is balanced between these competing interests.

Third, the draft would require the government to first consider the burden that would be placed on members of the supply chain before considering the value of the protection of patients that any enhanced protections might impose.  Again, I think there should be more balance here.  As written, the draft seems to tie the hands of the FDA if anyone thinks that the industry might be burdened in any way, regardless of how serious the problem might become.  That’s not the kind of bill we should expect from the House of (the People’s) Representatives.

Finally, the draft would firmly preempt all state and federal pedigree regulations immediately on enactment rather than after the new federal requirements would go into effect.  Of course, if the preemption provision wasn’t in either the House or the Senate drafts we wouldn’t even be talking about them because the drafts wouldn’t exist.  However, if the politicians who are carrying these drafts forward are really interested in protecting patients, they will change the wording so that these existing laws are not preempted until at least the minimal new regulations would go into effect.  This is only logical to prevent a period of time when some parts of the country would otherwise experience a total lapse in their current protection.


Is the Senate draft any better (see “The New Pharma Track & Trace Discussion Draft In The Senate”)?  Slightly.  The Senate draft suffers from many of the same problems I mentioned above.  The main improvement is that the Senate draft would become an interoperable, electronic, unit-level serialization-based track & trace system 10 years after enactment.  That would be 2023 if you assume the final bill would be enacted this year.

The California Board of Pharmacy recently documented many specific flaws in the Senate draft (see “California Responds To The Senate Pharma Track & Trace Discussion Draft”).  California has some recent experience working through flaws in legislative language (see “Q&A With Virginia Herold, Executive Officer, California Board Of Pharmacy” and “The Board of Pharmacy Must Respond To Ideas For Making EPCIS Work” among others) so I think their comments should carry more weight than perhaps normal and they should give the federal politicians pause.


During the markup session in the Health Subcommittee of the Energy & Commerce Committee of the House of Representatives last week, several Representatives (mostly from California and Florida) asked that the “ceiling” be removed from the preemption provision so that individual states that have a bigger problem with criminal attacks could still implement additional supply chain regulations beyond those in the federal bill.  Currently both the House and the Senate drafts prevent any state from enacting and enforcing anything less or more restrictive—a floor and a ceiling.

If you look at it from a patient protection standpoint, it makes total sense to allow states with unique criminal problems to impose whatever they need to fight that crime.  But, of course, that would allow the “patchwork” of state pedigree laws to continue.  From an industry perspective, what would be the point of a federal regulation if it were not to wipe out the more restrictive state laws?  It is an example of the larger debate between federal regulation of interstate commerce and states’ rights.

Personally, I come down on the side of federal regulation on this one because the pharma supply chain is truly national.  But that means that the problems found in a single state should be viewed as national problems and the national regulations should be designed to address those problems directly and not take an “on-average” approach.

If you are going to regulate the national drug supply chain as if it had the criminal attacks that are experienced in, say, Utah, then you would be better off not having a national law and stick with the patchwork.  At least the patchwork enables the protection of patients in every locality from the level of criminality experienced in that locality.  A federal law that acts as both a floor and a ceiling–such as both of the current drafts–would provide more protection than might be currently necessary in some of the states and it would provide less protection than is needed in some other states, and it would block any additional protection from being imposed by those states.  That’s just wrong.

How a bill becomes a law in the U.S. is an interesting process.  In my view, the most recent public versions of these drafts would result in more protection of the industry than patients, despite the claims and intentions.  However, both the House and the Senate drafts continue to be modified by their sponsors before final action by their respective Committees.  Then they could be amended on the floors of their respective houses and again in conference, if they even make it that far.  At this point, the final outcome is far from certain.

If you are following the process, what do you think about these drafts?


P.S.:  For those of you who have forgotten how a bill becomes a law in the U.S., here is the Schoolhouse Rock classic explanation, plus a few parodies that you might find entertaining.


One thought on “An Industry Protection Bill Concealed Under The Veil Of Patient Protection”

  1. 2025 House vs 2003 Senate. K Street bought off the Congress yet again. The Congress needs to sign a Hippocratic Oath to protect patients not special interest groups. IT can make a solution given a smidgin of encouragement.

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