What Happens When We Run Out of NDC Numbers?

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The pharmacy world has faced many system challenges over the last 20 years, from Y2K and HIPAA privacy and security regulations to Medicare Part D and the implementation of CMS-mandated transaction standards. The industry managed to negotiate each of these hurdles with success, but another challenge is looming, one the industry has essentially left unaddressed.

The issue at hand is that the drug product identifier used by pharmacies to submit prescription claims — the NDC (National Drug Code) number for the majority of those products — is going to run out of numbers sometime in the next decade. Pharmacists recognize the NDC number as the 10-digit number on product labels (“FDA NDC”) and the NCPDP-formatted 11-digit number that identifies the product in pharmacy and ordering systems (“standard identifier”).

The industry created the 11-digit format to accommodate the three different 10-digit FDA NDC formats (4-4-2, 5-3-2, and 5-4-1) employed today. Adding a leading zero to one of the FDA NDC segments (labeler code, product code, and package size code) results in the 11-digit standard identifier format. However, the FDA warned the industry that it would expand the labeler code segment to six numeric characters when it has exhausted the available five-character code combinations. This means the FDA NDC will then be 10 or 11 digits. The question is how to convert an FDA NDC with a six-digit labeler code into the 11-digit standard identifier used by pharmacy systems without running the risk of duplicating a product ID already assigned.

The issue at hand is that the drug product identifier used by pharmacies to submit prescription claims — the NDC (National Drug Code) number for the majority of those products — is going to run out of numbers sometime in the next decade.

One option is to reuse old NDC numbers. Rules for NCPDP product identifiers state that “identifiers are to never be re-used. Once assigned to a product based on the chemical, strength (if applicable), dosage form (if applicable), route of administration (if applicable) and package size, the identifier should never be assigned again.” The FDA has taken a similar position in that when a registrant has discontinued a drug product, its product code may not be reassigned to another drug product. If a discontinued product is reintroduced into distribution, it must be assigned the same NDC. Many in the industry considered FDA’s previous position that the NDC could be assigned to another drug product a dangerous practice that could lead to patient harm. If patient safety is truly a strategic priority, product IDs should not be reused, regardless of the length of time the ID has been dormant.

Other product identifiers such as UPC and UDI (unique device identification) also need to be considered. The UDI is a global identification system that replaces the NHRIC (National Health Related Item Code, also known as the HRI) and is for use with medical devices. Manufacturers establish the UDI using standard codes like the GTIN (Global Trade Item Number), which is an 8-, 12-, 13-, or 14-digit identifier. Even though these identifiers should not be contracted, NCPDP is forming a process to convert these 8-, 12-, 13-, and 14- digit identifiers to the 11-digit standard identifier for claims processing.

Starting the Discussion

There are many questions to answer, including:

What is the right length for the product ID? Are 19 characters enough? How about 40 (another number referenced in industry discussions)?

Should alphabetical characters be accepted along with numeric characters in the product ID? Would it be easier to make the 11-digit format alphanumeric and expand it to 19 characters?

Do the standards used for claims submission accommodate all possible product ID types?

What do the drug databases and their users need to do to be ready for all possible product ID types?

What is a reasonable amount of time for the industry to develop a solution and implement a new product ID format? 

Industry Pushback

The industry resisted making a change to the product ID length because so many systems only accept an 11-digit format by design. This is delaying the inevitable, as all of these systems will need to change the product ID format to accommodate as many digits needed for all of the different identification systems used for products dispensed by a pharmacy. NCPDP standards accommodate 19 characters for the product ID and use a separate qualifier to identify the product ID as an NDC, UPC, GTIN, etc. Even though standard formats allow 19 characters for a product ID in transactions, most systems today only provide 11 spaces in the drug databases, therefore only 11 digits fill those 19 spaces. The issue affects pharmacy and claims-processing systems, and “downstream” systems that collect transaction information with drug data for analysis and reporting. There are also the EMR (electronic medical record) systems that will be affected.

So what is the call to action? A discussion of this issue between all industry stakeholders must start now. There is a need for an organization to spearhead and lead this discussion. Industry stakeholders include:

  • Pharmaceutical manufacturers

  • Government agencies (FDA, CMS, etc.)

  • Wholesalers

  • Pharmacies

  • Pharmacy and EMR system vendors

  • Claims processors

  • Claims reconcilers

  • Data aggregators

  • Compendia

  • Industry associations

Industry members can start the discussion and work toward the goal using national forums provided by organizations such as ASAP, NACDS, NCPA, and NCPDP to create a workable solution. Independents that feel they don’t have a voice in this issue should work with their pharmacy system vendor. Industry associations, wholesalers, and system vendors need to be the voice for the independent pharmacist.

While industry experts have warned drug data users of this problem over the last five to 10 years, there has been little movement toward a resolution. Even though the implementation of a six-character labeler code may still be years away, the time to act is now. Most will agree that it is better if the industry initiates this effort rather than waiting for the government to mandate a solution, which might not meet industry needs and have an aggressive deadline that may be challenging. CT


Dave Schuetz, R.Ph., is a consultant at Pharmacy Healthcare Solutions, Inc., with 30 years of pharmacy experience. He can be reached at dschuetz@phsirx.com.

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