Viewpoints: March/April 2014

The Drug Quality and Security Act (DQSA) was signed into law on Nov. 27, 2013, and in the last issue of ComputerTalk we discussed the requirements to be implemented under the act in the first three years. Within this time frame, guidance documents will be issued, standards for information exchange will be published, wholesalers will become licensed, and transaction information, history, and statements will be provided for each product transaction. However, the law is slated to take 10 years to fully implement. Here, we will discuss the longer-term conditions and implementation issues expected from 2017 through 2023, by which time the act will be fully operational.

View The Timeline of Track-and-Trace Deadlines for 2017 and Beyond

Starting Nov. 27, 2017, drug products must contain a product identifier — a two-dimensional data matrix barcode that contains information on the standard numerical identifier, lot number, and product expiration date. The standard numerical identifier will comprise the product’s NDC and a unique alphanumeric code of up to 20 characters. The product identifier should be both human and machine readable. The product identifier will facilitate product recalls because it will contain individual lot numbers of a drug.

At this same time, manufacturers will be required to respond to verification requests regarding whether a particular product identifier corresponds to that manufacturer’s product. Manufacturers may satisfy this requirement through an electronic database that could be developed and operated either in-house or by another entity, the latter of which may be the most likely course of action. The development and operation of these manufacturers’ databases could potentially be done by one outside entity, but it remains to be seen if this will be the case. If so, this could add an additional security component, since all product information would be centralized.

By November 2020, pharmacies will only be allowed to engage in product transactions if the product is encoded with a product identifier. At this same time, pharmacies must be able to check the lot numbers in their inventory to determine if potentially counterfeit drugs are present. This will require pharmacies to keep track of the product identifiers in their inventory, and pharmacies may need internally developed electronic databases or have an outside firm design such a database. These requirements lend themselves to the adoption of barcode scanning by more pharmacies, which could be used to track product identifiers. Since many drug products have an expiration date that extends beyond three years, additional issues may be raised if older drugs are still left in the supply chain from before the November 2017 product identifier implementation deadline. Although the act states that exemptions may exist for these products, this introduces another layer of complexity to the act’s implementation.

By Nov. 27, 2023, the act specifies that transaction information and statements will be exchanged in a secure, interoperable electronic manner. By this time, it should be possible to trace the transaction information for each drug package from the manufacturer to the dispenser. With this new technology, the entrance of counterfeit drugs into the supply chain will become much more difficult and likely require collusion. Wholesalers and third-party logistics providers will be required to obtain licenses through the government and be subjected to inspections, making it more difficult for questionable parties to enter and participate in the supply chain. Furthermore, a database of authorized wholesalers will be published by the FDA and will be available to the public on the Internet.

Not only will the new track-and-trace legislation help to reduce the entrance of counterfeit drugs into the marketplace, it will also facilitate product recalls for contaminated drugs. The addition of the product identifier that contains lot numbers means that manufacturers and/or pharmacies will be able to directly identify patients who have received the recalled product. The new technology will make it easier to reach these patients quickly and efficiently.

A rarity in today’s political climate, DQSA received bipartisan support in Congress, and it seems like most parties are happy with this positive step forward for protecting America’s pharmaceutical supply channel. The Pharmaceutical Distribution Security Alliance was a proponent of the passage of this act and is made up of a diverse group of stakeholders, including biopharmaceutical manufacturers, distributors, pharmacies, and third-party logistics providers. Furthermore, the National Community Pharmacists Association, National Association of Chain Drug Stores, and American Society of Health-System Pharmacists all publicly supported the legislation. The support from many different stakeholders is not difficult to understand. This legislature will increase patient safety and ensure that counterfeit drugs do not enter the market to compete with legitimate pharmaceuticals. CT

Ann Johnson, Pharm.D., began working for PHSI as an intern in 2010 and is now the newest pharmacist consultant on the team. She has experience in independent retail pharmacy, as well as specialty, clinical, industry, and ambulatory-care pharmacy. Although working on a variety of projects, Johnson’s current emphasis is in analytics and pricing reimbursement, financial models, and market research. The author can be reached at


Timeline of Track-and-Trace Deadlines for 2017 and Beyond ––>

Nov. 27, 2017 

Manufacturers must affix or imprint a product identifier to each package and homogenous case of a product and maintain this information for not less than six years.

Manufacturers must provide subsequent owners with transaction history, transaction information, and a transaction statement in electronic format.

Manufacturers may receive verification requests from authorized repackagers, wholesale distributors, or dispensers regarding whether the product identifier in question corresponds to the product identifier affixed by the manufacturer, and must respond to such requests within 24 hours. 

Nov. 27, 2018

Repackagers shall affix or imprint a product identifier to each package or homogenous case of a product.

Repackagers can engage in transactions involving a product only if the product is encoded with a product identifier.

Repackagers may receive verification requests from authorized manufacturers, wholesale distributors, or dispensers regarding whether the product identifier in question corresponds to the product identifier affixed by the repackager, and must respond to such requests within 24 hours.

Repackagers must verify product identifiers of returned products if they intend to further distribute such a product.

Nov. 27, 2019 

Wholesale distributors may only accept returned products from a dispenser or repackager if the wholesaler can associate the returned product with the transaction information and transaction statement. The transaction history of this product shall begin with the wholesale distributor that accepted and verified the returned product.

Wholesale distributors may only engage in transactions involving a product if the product is encoded with a product identifier.

Wholesalers must verify the product identifier on returned products if the product shall be redistributed. 

Nov. 27, 2020 

Dispensers may engage in transactions only if a product is encoded with a product identifier.

Dispensers should have systems to verify whether the lot number of a suspect product corresponds with the lot number for such a product and should be able to verify that the product identifier corresponds with the product identifier for such a product.

May 27, 2022 

A private consulting firm’s software assessment started on May 24, 2016, must be complete with a prior public comment period and a public meeting. 

Nov. 27, 2023 

Transaction information and transaction statements shall be exchanged in a secure, interoperable, and electronic manner.

Transaction information shall include the product identifier at the package level.

Systems and processes for verifying a product identifier shall be required.

Part One of this series first appeared in ComputerTalk’s January/February 2014 issue.