The Coming Transition To Serialized Data

???????????In less than one month the Drug Supply Chain Security Act (DSCSA) will require all sales of drugs in the U.S. pharma supply chain to be accompanied by some very specific data (see “FDA Publishes Draft Guidance For DSCSA Data Exchange”).  The law requires companies to begin exchanging data on January 1 in either paper or electronic form, but because it would be virtually impossible for the big 3 wholesale distributors to accept even a single piece of paper for even a single shipment, the bulk of the U.S. sales by pharma manufacturers will be documented electronically from day-one.  It turns out, the vast majority of that electronic documentation will be passed in the form of Electronic Data Interchange (EDI) Advance Ship Notices (ASNs) (see “DQSA: Getting To Electronic Transaction Data Exchange”, “Just Released – The HDMA EDI ASN Guidance For DSCSA”, “HDMA Has Updated Their EDI ASN Guidance For DSCSA, Again” and “The HDMA Supply Chain Product Transaction Scenarios For DSCSA”).

But the vast majority of those EDI ASN documents are not likely to carry any serial numbers in them, even after November 2017 when the DSCSA will require manufacturers (2018 for repackagers) to include serial numbers within the 2D barcodes applied to all of their drug packages (and in linear or 2D barcodes on their cases).  The law does not require companies to include serial numbers in the Transaction Information (TI) they provide to their customers until late 2023.

But let’s say a manufacturer decides in 2017 that they want to jump out ahead of the legal requirement by passing their serialization data in their TI right away.  After convincing their lawyers, CEO, CFO and stockholders to fund investments six years before they are needed and that they can mitigate the risks of potentially passing inaccurate, though optional, data, they will need to decide if they should add serial numbers to their existing ASNs, or replace their EDI-based DSCSA data exchange infrastructure with a data exchange solution based on GS1’s Electronic Product Code Information Services (EPCIS).


A company deciding to add serial numbers to their EDI ASNs could make use of existing guidance from the Healthcare Distribution Management Association (HDMA).  Back in 2011 the HDMA published guidance for doing exactly that (see “GS1 Identifiers and EPC’s in EDI Messages: Important New HDMA Guidance”).  That would work, but the investment might be thrown away a few years later because more than a few people (myself included) think that EDI ASNs will only be used for exchanging electronic transaction information for meeting the DSCSA until around 2022 or so.  At that time, the thinking goes, the FDA and/or the industry will settle on the use of GS1’s EPCIS standard for serialized data exchange of DSCSA transaction data.

So why am I even including EDI ASNs as a potential choice for serialized data exchange in 2017?  Because the use of ASNs will be so dominant and entrenched by 2017 that it is unlikely manufacturers will find many customers willing and able to switch to EPCIS to accept their serialized TI documents.  EDI ASNs might be the only viable alternative for companies wanting to push their serial numbers out early.  But the same problem also exists with “serialized ASNs”.  For companies to make sense out of the serial number data elements contained in their incoming ASNs, they would need to modify their applications to extract that data and then make some use out it.  What use would they make out of it once they can extract it considering they won’t need it yet for compliance reasons?  I don’t know.  Maybe after they go to all that expense, they will come up with some good use for it.  How’s that for a compelling business case?


So ASNs have too many issues to make it a good choice for adding serial numbers. How about just switching to a solution based on GS1’s EPCIS standard?  Seems logical.  After all, many manufacturers will make significant internal use of EPCIS-based solutions when adding the serial numbers to their packages prior to November 2017, so why not just use it externally to pass the TI?

EPCIS was originally designed to document supply chain transactions (events) that are based on products and shipping containers containing serial numbers so it is an excellent choice.  As already pointed out above, most knowledgeable people tend to agree that the Enhanced Drug Distribution Security (EDDS) phase of the DSCSA that begins in late 2023 will be based on EPCIS in one way or another.

The problem is, nobody will know exactly what way EPCIS will be applied at that time.  Congress instructed the FDA to figure out how the EDDS system will work through public meetings, dockets and an industry pilot between now and about 2021 so until that time, investments in EPCIS-based data exchange are speculative at best.  A company that creates a system to exchange serialized transaction data in 2017 may find that they will be forced to make significant modifications to that system prior to 2023 to ensure they remain in compliance at that time.

Another problem is that companies would also need to pass transaction history (TH) data.  After 2023, TH will not be necessary so those that wait until then will not need to deal with this step, but prior to that date, all sales transactions must be accompanied by TH, so early converts to EPCIS for serialized data exchange would need to pass additional event data that corresponds to the TI data for every prior change of ownership back to the manufacturer (that is, the TH data).  The farther down the supply chain, the more data there will be in the TH.

Yet another problem is that not all recipients are likely to want to change their systems, whether EDI or EPCIS-based, to make use of serial numbers.  In fact, most recipients will probably not be interested in making any changes to their data exchange solutions until it is mandated by DSCSA deadlines.  So manufacturers who have successfully convinced their management and stockholders to allow them to make those investments early will also need to convince other companies and their stockholders to join them in their early investments.

But even if a manufacturer was so bent on spending some money on pushing serial numbers out to customers early is successful in convincing just one of their big customers to make matching investments, they would still have to keep their existing EDI ASN solution so they could supply non-serialized transaction data to all of their other, more frugal customers.  Operating two different infrastructures for different sets of customers is likely to be very costly.


OK, so let’s assume no one is really going to pass serial number data more than a year or so before the law mandates it.  That’s so far out into the distant future that we can almost ignore it for now.  But what about the possibility that someone will want to switch their data exchange from the non-serialized EDI ASNs we will see widely in January to the exchange of non-serialized EPCIS events?  Earlier this year GS1 updated their EPCIS standard to incorporate lot-based supply chain events.  That is, for the first time, you could use EPCIS events to document supply chain transactions of products that do not have serial numbers on them (see “GS1 Ratifies Updated Versions of EPCIS and CBV”).  Seems perfect for what we have happening today, right?

Some of the same arguments I made above for switching to EPCIS for serialized data exchange apply here too.  Effectively, once the whole industry spends the money necessary to get EDI ASNs to comply with the data exchange requirements of the DSCSA, I don’t think there is going to be any appetite for changing to anything else until it is absolutely necessary.

I’ve covered most of this ground before (see “Will GS1’s EPCIS Be Used Widely For DSCSA Data Exchange?”) and I still feel strongly about it, as you can see.  In my view, the “coming transition to serialized data” will not happen before 2023.  But I know there are those out there who believe that companies in the supply chain will switch to serialized transaction data passed in EPCIS events well before that.  Those who attended the recent HDMA Traceability event heard a bit of that from some of the speakers.  I just can’t figure out how it could possibly happen.  Can you?  Let me know in a comment.


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