RFID Tracks Medicine

A new IBM technology aims to prevent drug counterfeiting by creating electronic certificates of authenticity based on RFID tags, allowing the pharmaceutical companies to track the movements of drugs through every step of the supply chain.

AmerisourceBergen, one of the nation's largest pharmaceutical distributors, is using the IBM software in a Sacramento, Calif., pilot program in preparation for a state law requiring electronic pedigrees for drugs by Jan. 1, 2009.

It's "a way for us to be able to track chain of custody of an individual sellable unit of a drug from the manufacturer to the distributor and to the pharmacy," says Shay Reid, who oversees AmerisourceBergen's RFID project. "We can tell exactly where the product originated from," as well as the date and time it's delivered to a customer.

Reid says it's hard to quantify the prevalence of counterfeit drugs, but it's probably "much less than 1%" of the total supply chain.

The electronic pedigree -- or "ePedigree" -- is a new feature added to IBM's WebSphere RFID Information Center (RFIDIC) software, IBM announced last week.

The software uses RFID to keep track of serial numbers on bottles, allowing the pharmaceutical industry to make sure drugs have been in the appropriate hands at all times, find out if a drug is expired or if it's in a lot that's been recalled. Drug bottles have unique serial numbers printed on them, but all the rest of the data is in IT systems, says Christian Clauss, director of sensor information management for IBM software.

"We generate [the ePedigree] on a screen and allow you to print it out," Clauss says. "The notion is when a government official picks up a bottle and says 'show me the pedigree,' you need to be able to show it to them on a screen."

RFIDIC can figure out if a counterfeit drug is being distributed when the software finds two instances of a drug in the supply chain, he says. Counterfeit drugs must have authentic-looking serial numbers because distributors and sellers won't accept shipments if they lack the numbers.

"You'd start to see the same number in two locations" if there was a counterfeit, Clauss says. "If there's not a legitimate number on the drug it won't be accepted. People will refuse to move a drug down the supply chain if it doesn't have a valid number."

Tracking RFID tags on bottles doesn't guarantee the pills are authentic. Fraudsters could put fake pills into a bottle, if when they are done the bottle still has the correct serial number, RFID tag and an intact tamper-resistant seal, Clauss says.

"We can't guarantee that nothing can go wrong. All we can do is make it so hard to do that it becomes uneconomic," he says.

IBM's new ePedigree feature is designed partly for compliance with the California law and regulations on the books in many other states. Electronic pedigree laws vary by state and country, Clauss says.

"That's why you see such a gravitation toward the California law," he says. "The California law is really well thought out and the industry is trying to get behind it. It solves the problem and is quite doable by the companies."

IBM's not the only vendor trying to solve this problem. Acsis is offering a solution combining software, hardware and services to help pharmaceutical companies track the movements of drugs. Also, software firm Ross Systems and supply chain company SupplyScape partnered last year to provide software for tracking drugs and complying with government regulations and agreements with trading partners.

AmerisourceBergen began its Sacramento pilot in May. The company was previously using ePedigree certificates based on passing paper from one trading partner to another, Reid says. Information inside the previous system was not as readily accessible, and notification features would only work for one trading partner.

With two-way communication in the new IBM system, "if we fail to receive one of those cases, there's immediate notification for both parties that that particular case is missing," Reid says. "Whereas, if you just have a one-way notification, we might know the case is missing but the manufacturer never actually receives the confirmation."

RFIDIC would cost at least US$100,000 for a big pharmaceutical company, according to Clauss. A broad deployment could cost millions of dollars.

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