Heart Failure is a human condition that is characterized by several easily identifiable symptoms, including fatigue, difficulty breathing and in its later stages, gurgled breathing. My mother and my mother-in-law both suffered from heart failure during their decline. Analogous to heart failure in humans is a condition of an identifier system that is near the end of its useful life that we can call “identifier failure”. At the end of November, a new FDA final guidance called “Requirements for Foreign and Domestic Establishment Registration and Listing for Human Drugs, Including Drugs That Are Regulated Under a Biologics License Application, and Animal Drugs” went into effect. Buried deep within this 200+ page document is the official announcement that signaled the National Drug Code (NDC) identifier system is now afflicted with this end-stage condition. The NDC won’t last long now, and there is no longer any excuse for inaction. The need for a replacement is now urgent.
FDA DROPS BOMBSHELL: LABELER CODES TO JUMP FROM 5 TO 6 DIGITS
The announcement buried in the new final guidance is the approaching exhaustion of 5-digit labeler codes. The labeler code is the code assigned by the FDA to each drug or biologic manufacturer and repackager referred to by the FDA as a “labeler”. New labeler codes issued by the FDA have been 5-digits long since the early 1970s (see “Anatomy Of The National Drug Code”). FDA has warned of the mathematical inevitability of the exhaustion of the 5-digit labeler codes in the past, but with this new guidance, they have modified the formal definition of the NDC for the first time so it is now a 10- or 11-digit code (pay close attention to the “or” in the new definition) [see the newly modified 21 CFR 207.33(b)(1)]. By adding the new digit to the Labeler Code, the NDC will become a variable length identifier. This is a major change that has huge implications for the industry. The FDA’s analysis of the economic impact of the overall final guidance completely ignores the cost that this change will impose on the industry. The impact across the industry of a Labeler Code composed of either 5- or 6-digits will dwarf any other change found in this final guidance by orders of magnitude. Here’s why.
NDC IS NOW A VARIABLE LENGTH IDENTIFIER
Because the Labeler Code is one of the components of the NDC, from this point on, by definition, the NDC is a variable length identifier, either 10- or 11-digits, but we won’t see any 11-digit NDCs until the day after the FDA runs out of 5-digit Labeler Codes and they assign the first one as a 6-digit Labeler Code. All NDCs defined by that new labeler, and those companies that register after them, will be 11-digits long. When will that be? I wish the FDA would make some kind of projection to tell us the earliest they believe this switch could happen. I’ve tried to come up with my own estimate by comparing the list of labeler codes from 2013 with today’s list, but I can’t tell which unused codes are still available for future assignment, and which are now “dead” because the company they were assigned to is no longer registered. They would know that, but I don’t, so I can’t make a valid projection.
The day the first 11-digit NDC is shipped into the supply chain, the following IT systems will break (one of the symptoms of the “identifier failure” condition):
- Order placement, fulfillment and inventory software at all U.S. wholesale distributors and dispensers;
- Claims and reimbursement software at all dispensers, PBMs, CMS and health insurance companies.
This also breaks the 11-digit, NDC-based reimbursement code (incorrectly referred to today by most dispensers and some wholesale distributors as “the NDC”). That’s because, if the real NDC is either 10-digits or 11-digits long, your NDC-based reimbursement code is going to have to be made 12-digits to avoid confusion with the real 11-digit NDCs. By the way, the need for this NDC-based reimbursement code is another symptom of “identifier failure”.
This will also break the interoperability between the NDC identifier and GS1’s GTIN. Since the beginning of the NDC system, GS1 US (the U.S. Member Organization, or, “MO” of GS1, the global standards organization) has reserved all future 10-digit NDCs within their 12- and 14-digit Global Trade Item Number (GTIN) identifier for current and future FDA labelers. For several decades, drug companies have used the GS1 UPC symbology to encode their 10-digit NDCs within a GS1 GTIN (see “Anatomy of a GTIN” and “Depicting An NDC Within A GTIN”) to meet the FDA’s linear barcode rule (see “Why NOW Is The Time To Move Away From Linear Barcodes” and “Will The FDA Eliminate The Linear Barcode On Drugs?”). Unfortunately, that linear barcode rule from 2006 survived this new updated definition of the NDC. Incredibly, even though they refreshed Section 201.25, the FDA didn’t even bother to reference the current name for GS1, leaving their former name “European Article Number/Uniform Code Council (EAN/UCC)” in the text. That name has not been valid for over 10 years now.
The problem is, you cannot encode an 11-digit NDC identifier in either the 12-digit or the 14-digit GTIN. There just aren’t enough digits left over for the GS1-specific parts. And, even if there were, they have not reserved the space within the range of possible GTINs for 11-digit NDCs as they had for 10-digit NDCs so overlaps would occur—a serious problem. This is another symptom of “identifier failure”.
So, to encode an 11-digit NDC within a GS1 barcode, you will need to use a symbology that allows the use of GS1 application identifiers (AIs) (which cannot be done with the UPC symbology). That is already happening as people move to 2D Datamatrix barcodes as serialization is deployed to meet the Drug Supply Chain Security Act (DSCSA), but because the linear barcode rule still exists, companies with an 11-digit NDC will need to use GS1-128 or some other AI-capable linear symbology. And, they will have to encode their 11-digit NDC within that barcode with a new AI specifically issued by GS1 for the U.S. FDA National Health-Related Number (NHRN), just like is happening in many countries in the European Union as part of compliance with the Falsified Medicines Directive (see GS1’s recent white paper about this “Product Identification in Healthcare”). In the U.S., that NHRN would need to appear in both the linear barcode and the 2D Datamatrix barcode on each drug package. Today, for that to work within GS1 standards, you would need to define a GTIN to that same product and so each of these two barcodes would need both a GTIN and the NHRN that contains the 11-digit NDC (GS1 might change this, but there appears to be significant resistance to going down that path). IT systems throughout the supply chain will need to be able to read and interpret correctly the linear and 2D barcodes that are encoded this way, and the “traditional” way with 10-digit NDCs. This jump in complexity is another symptom of “identifier failure”.
This is a huge step backward, and companies will need to prepare for that step well in advance of the issuance of that first 6-digit Labeler Code. Back in 2012 the National Council for Prescription Drug Programs (NCPDP) recognized the impact of a change like this and they grew concerned about how the FDA would handle it. In a letter to Randy Levin, MD, Director of Health and Regulatory Data Standards at the FDA, they proposed that the FDA open a dialog with stakeholders to begin collaborating on how to address it. At that time, NCPDP estimated that the industry would need 8 to 10 years to facilitate complete transformation of all the systems, processes, documentation, and business modifications necessary for a change of this size and scale. As far as I know, no such collaboration was done. Do you think we have 8 to 10 years before the FDA starts assigning 6-digit Labeler Codes? I wish we knew.
Symptoms of “identifier failure” include the need to translate and reformat (e.g., the 11-digit, NDC-based reimbursement code), and conversion to variable length (the action the FDA has just taken) to extend an identifier’s useful life. These symptoms are proof that the NDC is in its last days. We need to kill it off humanely under a controlled plan.
LET’S TAKE A STEP FORWARD AND FIX IT INSTEAD
I’ve been worried about this same thing for quite a while (see “UDI And The Approaching End Of The NDC” and “Is A GS1 GTIN Really Usable As An NDC For DSCSA Compliance? Part 1”). In fact, I proposed a simple fix to the FDA in “An Open Letter To The FDA, RE: Please Fix The National Drug Code Soon”. In that letter, I proposed that the FDA just do the same thing they did when they created the Unique Device Identification (UDI) system back in 2012 (see “FDA Proposed UDI: A Revolution In Number Assignment”). It would be so easy, and less costly for the industry, I think. Even if I’m wrong and the costs turn out to be just as high for the industry to switch to a “Unique Pharmaceutical Identification” (UPI) system, as I called it, that would be a step forward, rather than a step backward. The investments would be justified because they would last a lot longer.
FDA has just taken a minimal step to address this problem from their perspective, but it isn’t a fix. They seem to be aware of that. The new guidance includes this message from the FDA about what they plan next:
“FDA recognizes the desirability of a single, standard format for NDCs, having three segments of consistent lengths, as we eventually transition to six-digit labeler codes. We intend to initiate a public discussion of future formatting options in the near future. In the meantime, the provisions included in this final rule are intended to accommodate the range of existing NDC formats, leaving room for necessary expansion to 11 digits.”
We need to make sure they move forward on this promise to initiate a public discussion as soon as possible. Recently, they don’t have a good track record on moving fast (see “Who Is Being Harmed By Four Overdue FDA DSCSA Guidances?” and “Is The FDA Intentionally Delaying Publication Of The Overdue DSCSA Guidance?”). It is up to the industry to hold their feet to the fire, or risk a catastrophe in the future.