A pilot study organised by Accenture to explore the value of implementing radiofrequency identification (RFID) and electronic product code (EPC) technology in the pharmaceutical industry has concluded that there are numerous benefits.
The findings, based on shipping, tracking and tracing nearly 13,500 packages of pharmaceuticals over an eight week period, show that EPC/RFID could - in this limited, controlled environment at least - demonstrated proof of concept. A group of companies across the supply chain contributed to the effort.
Applying the technology can help satisfy regulatory and retailer requirements, increase product security and consumer safety, enhance order accuracy and labour productivity and increase the efficiency and speed of recalls and returns, according to the study.
In all cases, the system effectively tracked selected pharmaceutical products from the manufacturer's distribution facilities through the supply chain to the point of dispensing. This provided all necessary drug 'pedigree' information demanded by the regulatory authorities.
Nevertheless, the report notes that the system employed many manual processes that ultimately will require automation to achieve the desired benefits from this technology.
"The technology employed must improve significantly and the intra-industry information systems must be built before this requirement can be satisfied," according to Accenture.
Overall, the pilot study demonstrated the ability of RFID/EPC to tag pharmaceuticals down to the unit dose level, in accordance with the demands of retailers such as Wal-Mart, which has already asked pharmaceutical companies to tag schedule 2 pharmaceuticals.
The group also worked with the US Food and Drug Administration's Anti-Counterfeiting Task Force on how RFID/EPC technologies can mitigate the risk of counterfeit drugs making it to market. This is a hot topic at the FDA, given the findings of a recent World Health Organisation report that 5 to 7 per cent of all drugs worldwide are fake, equivalent to $7-$26 billion of the current $327bn world market for drugs.
Other benefits included increased efficiency of returns and recalls, aided by the inclusion of detailed information such as lot number, expiration date and transaction date/time on each individual EPC. Moreover, the process was much less labour-intensive when conducting activities that would ordinarily require bar-code scanning of each individual item, such as shipping, receiving or cycle counting, as multiple items could be scanned at the same time.
The report also concluded that, as shipping and receiving would be more accurate, administrative efforts to follow up on shipment/receipt discrepancies would be reduced. However, it predicts that there may be an incremental increase in labour during the initial RFID adoption phase.
A second series of studies are due to begin in the New Year, according to a spokesperson for Accenture.
Hospital use of RFID set to grow
Meanwhile, a new report from Frost & Sullivan has concluded that the rising patient population in the US is increasing the demands on medical providers, and RFID can help by enabling them to effectively track their assets and reduce costs of misplaced equipment.
The report, entitled US RFID Markets for Healthcare, reveals that this market generated revenue of $300 million in 2004 and is projected to reach $658.1 million in 2007.
Citing the recent Food and Drug Administration (FDA) mandate requiring bar code automation - prompted by increasing medication errors and patient deaths - the report notes that this could reduce the funding available for solutions such as RFID within healthcare technology budgets.
"As vendors look to overcome this hurdle, emphasis on the advantages of RFID's tracking functionality as supplement, rather than replacement to bar code will be essential," it notes.