[Federal Register Volume 84, Number 27 (Friday, February 8, 2019)]
[Notices]
[Pages 2879-2883]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-01561]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2016-N-0407]


Pilot Project Program Under the Drug Supply Chain Security Act; 
Program Announcement

AGENCY: Food and Drug Administration, HHS.

[[Page 2880]]


ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA or Agency) is announcing 
the start of the Pilot Project Program Under the Drug Supply Chain 
Security Act (DSCSA Pilot Project Program). The DSCSA Pilot Project 
Program is intended to assist FDA and members of the pharmaceutical 
distribution supply chain in the development of the electronic, 
interoperable system that will identify and trace certain prescription 
drugs as they are distributed within the United States. Under this 
program, FDA will work with stakeholders to establish one or more pilot 
projects to explore and evaluate methods to enhance the safety and 
security of the pharmaceutical distribution supply chain. Participation 
in the DSCSA Pilot Project Program is voluntary and will be open to 
pharmaceutical distribution supply chain members to apply to the 
program. FDA will ensure that participation reflects the diversity of 
the supply chain, including large and small entities from all industry 
sectors. This notice establishes the DSCSA Pilot Project Program and 
includes instructions for submitting a request to participate and 
expectations for program participants.

DATES: FDA will be accepting applications for participation in the 
DSCSA Pilot Project Program beginning February 8, 2019 and continuing 
through March 11, 2019. The duration of the DSCSA Pilot Project Program 
will depend on the pilot project(s) accepted into the program and when 
the projects are completed.

FOR FURTHER INFORMATION CONTACT: Daniel Bellingham, Office of 
Compliance, Center for Drug Evaluation and Research, Food and Drug 
Administration, 10903 New Hampshire Ave., Silver Spring, MD 20993-0002, 
301-796-3130, [email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    On November 27, 2013, the Drug Supply Chain Security Act (DSCSA) 
(Title II of Pub. L. 113-54) was signed into law. The DSCSA outlines 
critical steps to build an electronic, interoperable system by November 
27, 2023, that will identify and trace certain prescription drugs as 
they are distributed within the United States. Section 202 of the DSCSA 
added sections 581 and 582 to the Federal Food, Drug, and Cosmetic Act 
(FD&C Act) (21 U.S.C. 360eee and 360eee-1, respectively). Under section 
582(j) of the FD&C Act, FDA is required to establish one or more pilot 
projects, in coordination with authorized manufacturers, repackagers, 
wholesale distributors, and dispensers, to explore and evaluate methods 
to enhance the safety and security of the pharmaceutical distribution 
supply chain.
    FDA is establishing the DSCSA Pilot Project Program to implement 
section 582(j) of the FD&C Act. This program is intended to assist FDA 
and members of the pharmaceutical distribution supply chain in the 
development of the interoperable electronic system to be established by 
2023. The 2023 system has the potential to reduce diversion of drugs 
distributed domestically as well as help deter counterfeit drugs from 
entering the supply chain. The pilot program will be designed to 
explore issues related to utilizing the product identifier for product 
tracing, improving the technical capabilities of the supply chain, 
identifying the system attributes that are necessary to implement the 
requirements established under the DSCSA, and any other issues 
identified by FDA (see section 582(j)(2)(B) of the FD&C Act).
    Particular program goals include: (1) Identifying the system 
attributes needed to implement the requirements of section 582 of the 
FD&C Act, particularly the requirement to utilize a product identifier 
for product tracing and verification purposes and (2) assessing the 
ability of supply chain members to satisfy the requirements of section 
582 of the FD&C Act; identify, manage, and prevent the distribution of 
suspect and illegitimate products as defined in section 581(21) and 
581(8) of the FD&C Act, respectively, and exchange product tracing 
information across the pharmaceutical distribution supply chain in an 
electronic and interoperable manner. FDA plans to coordinate with 
stakeholders to ensure that pilot projects reflect the diversity of the 
pharmaceutical distribution supply chain, including large and small 
entities from all industry sectors. The DSCSA Pilot Project Program is 
intended to help identify and evaluate the most efficient processes 
and/or systems to operationalize supply chain security requirements.

II. The DSCSA Pilot Project Program

    FDA is seeking pilot project participants from the pharmaceutical 
distribution supply chain (e.g., authorized manufacturers, repackagers, 
wholesale distributors, and dispensers) and other stakeholders. FDA 
expects potential participants to propose the design and execution of 
their pilot project in their submission to FDA; however, FDA intends to 
meet with selected pilot project participants to ensure that the 
learnings from the pilot project(s) will be complementary in informing 
all stakeholders in the development of the electronic, interoperable 
system that will go into effect in 2023. FDA encourages potential 
participants to focus their proposed pilot project(s) on the DSCSA 
requirements related to the interoperable, electronic tracing of 
products at the package level. Specifically, the pilot project(s) 
should focus on the enhanced requirements for package-level tracing and 
verification that go into effect in 2023. Such pilot projects will 
likely be more useful than pilot projects dedicated to lot-level 
tracing. If there is an adequate number of pilot project submissions, 
FDA may establish more than one pilot project to accomplish the goals 
of the DSCSA Pilot Project Program.

A. Products Eligibility

    Pilot projects should focus on applicable requirements to any 
prescription drug that is a ``product'' within the meaning of section 
581(13) of the FD&C Act. FDA anticipates that packages and homogenous 
cases of product that are part of a pilot project will generally bear a 
``product identifier'' as described in sections 581(14) and 582(a)(9) 
of the FD&C Act. FDA may also consider proposed pilot projects 
involving product that may be subject to a waiver, exception or 
exemption of certain DSCSA requirements, products that are 
grandfathered, in addition to products that are outside the scope of 
section 581(13) of the FD&C Act (e.g., over-the-counter medicines) if 
such project(s) could further the objectives of the DSCSA Pilot Project 
Program.

B. Potential Issues To Examine and Evaluation Methods To Use in Pilot 
Projects

    On April 5-6, 2016, FDA held a public workshop entitled ``Proposed 
Pilot Project(s) Under the Drug Supply Chain Security Act (DSCSA).'' 
This public workshop provided a forum for members of the pharmaceutical 
distribution supply chain to discuss the design objectives of pilot 
projects established by FDA under section 582(j) of the FD&C Act. Based 
on the information gathered at that workshop and from the comments 
submitted to the public docket for the workshop (Docket No. FDA-2016-N-
0407), FDA identified several potential issues to examine, and 
evaluation methods to use, in pilot projects established under the 
DSCSA Pilot Project Program. These potential

[[Page 2881]]

issues and evaluation methods are summarized in table 1. This table is 
intended only to assist in the design of potential pilot projects; it 
does not represent FDA's views or policies regarding the issues 
described in the table. For ease of reference, the potential issues to 
examine and evaluation methods have been grouped by focus areas for the 
pilot projects.

  Table 1--Potential Issues To Examine and Evaluation Methods To Use in
                             Pilot Projects
------------------------------------------------------------------------
                               Potential issues to  Potential evaluation
  Pilot project focus area           examine               methods
------------------------------------------------------------------------
Product Identifier..........   Processes     Impacts of
                               related to the        different
                               requirement for       representations of
                               manufacturers to      the product
                               affix or imprint a    identifier on
                               product identifier    systems or
                               to each package and   processes:
                               homogenous case of   --Number of errors.
                               product intended to  --Time to process.
                               be introduced in a   --Time to reconcile
                               transaction into      differences.
                               commerce.
                               Methods
                               used to issue and
                               manage serial
                               numbers (e.g.,
                               including a
                               contract
                               manufacturer's role
                               if applicable or
                               how a repackager
                               associates its
                               product identifier
                               with the product
                               identifier assigned
                               by the original
                               manufacturer).
                               Different
                               representations for
                               the product
                               identifier (e.g.,
                               different formats
                               of the National
                               Drug Code or serial
                               number).
Barcodes....................   Readability   Barcode
                               of a barcode either   read error rates:
                               printed or affixed   --Number of items
                               to product,           unnecessarily
                               including impact of   quarantined or held
                               environmental and     up.
                               human factors.       --Time and resource
                               Application   impacts.
                               of linear barcode
                               and 2D barcode on
                               product.
                              
                               Distinguishing
                               which barcode to
                               read/use.
Interoperability............   Process and   For both
                               technical             decentralized and
                               challenges due to a   centralized models,
                               variety of            time implications:
                               potential solutions  --To investigate
                               (e.g., type of        suspect and
                               database used and     illegitimate
                               system architecture   products.
                               for exchanging       --For notifications
                               information among     required within the
                               trading partners).    statutory
                               Maintaining   timelines.
                               the integrity of     --Related to scaling
                               information           up from pilot to
                               contained in the      full production.
                               barcode of            Product
                               serialized product    tracing information
                               throughout the        (across multiple
                               distribution supply   partners):
                               chain (e.g., a       --Capability to
                               trading partner       retrieve the
                               goes out of           information.
                               business or one      --Accuracy of the
                               acquires another      information (within
                               business).            and between
                               Different     systems).
                               methods for           Security
                               exchanging            and access:
                               information (e.g.,   --Evaluate and
                               the use of            document access
                               Electronic Data       levels for trading
                               Interchange,          partners.
                               Electronic Product
                               Code Information
                               Services, and other
                               solutions
                               separately).
Data/Database/System Issues.   Data          System
                               quality from          Performance and
                               beginning to end of   Effectiveness:
                               the product          --Time to access and
                               lifecycle and vice    use product tracing
                               versa.                information once
                               System        that data is
                               performance when      received into a
                               full or partially     system.
                               loaded with data.    --Quality of product
                               Data format   tracing
                               or processes for      information.
                               data transfer:.      --Number of breaches
                              --Use of technical     to system.
                               standards for        --Number of attempts
                               defining data         to breach the
                               attributes to         system that were
                               enable                prevented or
                               interoperable         minimized.
                               transfers.            Data and
                              --Methods to handle    product flow.
                               the ``master data''  --Number of
                               (product-specific     unsuccessful
                               data) and             attempts to access
                               transaction data      data and
                               separately to         operational
                               minimize ``master     impacts.
                               data'' redundancy.   --Number of system
                               Integration   interactions within
                               into individual/      one, and amongst
                               company data          multiple, trading
                               systems.              partners.
                               Control and  --Time and resource
                               access to data by     changes on
                               trading partners,     operations when
                               FDA, or other         data and product
                               federal or state      not moving at same
                               officials (data       time (e.g., product
                               governance).          arrives before data
                               Ability of    arrives).
                               the system to        --Time for location/
                               record product        ownership/status
                               status (e.g., to      changes to be
                               indicate expired,     reflected in the
                               illegitimate, in      system.
                               error, quarantined)  --Time of product
                               at all packaging      flow delays and
                               levels.               associated costs
                                                     due to system or
                                                     data problems.
Aggregation/Disaggregation..   Multiple      Number of
                               levels of adoption    system and product
                               of inference, by      interactions within
                               different trading     one, and amongst
                               partners. Impact of   multiple, trading
                               inference gaps,       partners.
                               changes or errors     Time
                               in data,              required to conduct
                               particularly          aggregate/
                               downstream when       disaggregate
                               searching or          operations and
                               examining the data;   transactions.
                               how can errors be     Accuracy of
                               corrected.            aggregation data
                                                     (measure error
                                                     counts).
                                                     Time to
                                                     gather aggregation/
                                                     disaggregation data
                                                     for investigations
                                                     and notifications.
                                                     Time to
                                                     resolve errors in
                                                     data.

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Verification/Notification...   Process for   Response
                               investigation of      times: Current vs.
                               suspect or            future process.
                               illegitimate          Time needed
                               product, including    to obtain product
                               any communication     tracing information
                               or coordination:.     to respond to a
                              --Making and           request for
                               responding to         verification.
                               verification          Time needed
                               requests.             to make, respond
                              --Making, responding   to, or terminate a
                               to, and termination   notification.
                               of notifications.     Time to
                              --Responding to        gather product
                               requests for          tracing information
                               information.          to support an
                              --Testing boundaries   investigation for a
                               of the system.        suspect or
                                                     illegitimate
                                                     product, or a
                                                     recall.
                                                     Percentage
                                                     of items that are
                                                     successfully
                                                     verified vs. those
                                                     that were targeted
                                                     for verification.
                                                     Number of
                                                     connections/queries
                                                     needed to gather
                                                     product tracing
                                                     information in
                                                     response to a
                                                     verification or
                                                     notification
                                                     request.
Exception Handling/Errors/     Identify      Percent of
 Inconsistencies.              `honest errors'       errors detected:
                               (e.g., over/under     Compare exceptions
                               shipments, clerical   introduced vs.
                               errors, or            exceptions
                               aggregation errors).  detected:
                               Correcting   --Identify the first
                               `honest errors'.      step in the process
                                                     where an error is
                                                     detected.
                                                     Number of
                                                     new or changed
                                                     processes needed to
                                                     accomplish DSCSA
                                                     goals:
                                                    --Time and resource
                                                     impacts.
                                                     `Honest
                                                     Errors':
                                                    --Number of items
                                                     unnecessarily
                                                     quarantined and
                                                     held up.
                                                    --Time required to
                                                     detect and correct
                                                     errors.
                                                    --Impact on trading
                                                     partners to correct
                                                     errors.
                                                     Barcode
                                                     read error rates:
                                                    --Number of items
                                                     unnecessarily
                                                     quarantined or held
                                                     up.
                                                    --Time and resource
                                                     impacts.
Special Scenarios...........   Situations    Error rates
                               when data and         for special
                               product do not move   processes:
                               together.            --Number of items
                               Situations    unnecessarily
                               when serialized       quarantined or held
                               product are sold      up.
                               and distributed      --Time and resource
                               along with non-       impacts.
                               serialized product.   Accuracy of
                                                     linkage between
                                                     original
                                                     manufacturer
                                                     product identifier
                                                     and repackager-
                                                     issued product
                                                     identifier.
------------------------------------------------------------------------

    In addition to the information in table 1, workshop participants 
and comments submitted to the public docket recommended factors that 
FDA should take into consideration when establishing pilot projects. 
The recommended factors include the extent to which the pilot projects:

 Represent the mix of products and levels of packaging in the 
supply chain
 Include a diverse set of supply chain stakeholders (types and 
sizes) and transaction types
 Use adaptive design to make the pilot projects more efficient.
 Target known weaknesses in the supply chain
 Can be completed in such a time frame to provide useful 
information for trading partners
 Evaluate human factors that could present implementation 
challenges
 Simulate illegitimate products/transactions to test a process 
or system
 Document costs to implement, use, and maintain piloted 
solutions

    Although the Agency intends to take these factors into 
consideration when establishing pilot projects, FDA also recognizes 
that a single pilot project is unlikely to satisfy every factor. 
Accordingly, requests to establish a pilot project need not satisfy all 
the factors listed in this document.

C. Instructions for Submitting a Request To Participate in the DSCSA 
Pilot Project Program

    Stakeholders interested in participating in the DSCSA Pilot Project 
Program may submit a request to participate by email to 
[email protected]. For a group of entities that partner to 
participate in a pilot project, only one submission and one point-of-
contact for the proposed pilot project should be provided in the 
request to participate. Requests to participate may also consider other 
ideas for a pilot project that are not included in this notice.

D. Submission Content for Requesting To Participate in the DSCSA Pilot 
Project Program

    The following information should be included in the request:

 Contact information for the submitter or point of contact, if 
different from the submitter (name, mailing address, phone number, 
email address)
 Names of all partnering entities that would participate in the 
pilot project (name of company and name of company representative)
 Type(s) of each partnering entity participating in the pilot 
project (e.g., manufacturer, repackagers, wholesale distributor, 
dispenser, third-party logistics provider, solution provider, trade 
association, etc.); Partnering entities may include authorized trading 
partners or other supply chain stakeholders
 Number of employees for each partnering entity to reflect 
company size
 Proposed start and finish dates of the pilot project
 Commitment to start the pilot project within 4 months of 
receiving a letter of acceptance from FDA
 Product(s) that will be used in the pilot project
 Location(s) where pilot project will be performed (facility 
address)

[[Page 2883]]

 Description of the proposed pilot project, including, but not 
limited to, the goals, objectives, processes that will be studied, and 
evaluation methods

E. Initiation and Duration of Pilot Projects

    The selected participants should be ready to start their pilot 
project within 4 months of receiving a letter of acceptance from FDA 
into the program. The duration of a pilot project should not exceed 6 
months. FDA may consider a pilot project with a later start date or 
longer duration depending on the proposed goal(s) and objective(s). 
Each pilot project is expected to be completed within the proposed 
duration time period. This time period does not include an additional 
30 days for completion of a final report (see Section II.G. Reports).

F. Participation in Pilot Projects

    Each participant that is selected into the program will be 
responsible for conducting its pilot project. A group of entities 
(e.g., members of the pharmaceutical distribution supply chain or other 
stakeholders, including trade associations) that partners to conduct a 
pilot project will be considered a single participant for purposes of 
the DSCSA Pilot Project Program. The participant will be responsible 
for the funding and resources necessary to conduct the pilot project, 
and for determining each partner's role and responsibility in its pilot 
project.
    Prior to launch of a pilot project, FDA intends to hold a design 
strategy meeting with the selected pilot participant(s) to review the 
goal(s) and objective(s)s for the pilot project and discuss the project 
plans and other pertinent details. FDA also expects pilot project 
participants to submit reports on the progress of their pilot projects 
to FDA (see Section II.G. Reports). Participants should evaluate their 
pilot projects using the evaluation methods they identified during the 
pilot project design process.

G. Reports

    Each pilot project is expected to be completed within the proposed 
duration time period, and FDA asks that all participants submit 
periodic progress reports to FDA while the pilot project is being 
conducted, in addition to submitting a final report after completing 
the pilot project. These reports will provide insight into the systems 
and process needed to comply with certain DSCSA requirements for 
enhanced drug distribution security.
1. Progress Report(s)
    Each pilot project program participant is expected to provide 
reports on the progress of its pilot project to FDA. The progress 
reports are intended to capture the ongoing work during the pilot 
project, including but not limited to, status or results, changes, 
challenges, and/or lessons learned. FDA will work with participants to 
develop an appropriate schedule for the submission of progress reports 
based on the design and duration of the pilot project. Because the 
duration of a pilot project should not exceed 6 months, the frequency 
of progress reports will vary based on the length of the individual 
pilot project. Pilot projects of relatively shorter duration may result 
in shorter time intervals between progress reports. For example, FDA 
may ask for monthly progress reports for a 6-month pilot project, 
however for a 1-month pilot project, FDA may ask for weekly progress 
reports.
2. Final Report
    Within 30 to 45 business days of completing a pilot project, each 
participant is expected to provide a final report to FDA that captures 
the description, objectives, methods, evaluation, costs and key 
findings, and lessons learned from the project. Timely completion of 
pilot projects and the final report will support FDA's DSCSA 
implementation, including the statutory requirements under section 
582(j) of the FD&C Act to consider information from pilot projects in 
the development of guidances for unit-level tracing and standards for 
the interoperable data exchange in section 582(h)(3) and (4) of the 
FD&C Act. FDA may also request that the participants meet with the 
Agency upon the completion of their pilot project or the final report.

H. Final DSCSA Pilot Project Program Report

    To ensure that all supply chain members benefit from the 
information generated by the DSCSA Pilot Project Program, FDA intends 
to make the following information about each pilot project of the 
program available to the public in a final program report: (1) The 
names and industry sector(s) of the pilot project participant(s); (2) 
the pilot project's objectives and evaluation methods; (3) the duration 
of the pilot project; and (4) the key findings and lessons learned from 
the pilot project. FDA intends to post the information related to the 
DSCSA Pilot Project Program and the final program report on FDA's 
website.

I. Recordkeeping

    Any records generated by a participant while conducting a pilot 
project should be maintained in accordance with the participant's 
normal recordkeeping practices. For pilot projects that involve 
partnering entities, the partnering entities should decide who is 
responsible for the records generated in the course of conducting the 
pilot project. FDA recommends that participants maintain the progress 
reports and final report for its pilot project for at least 1 year 
after completion of the pilot project.

III. Paperwork Reduction Act of 1995

    This notice contains information collection provisions that are 
subject to review by the Office of Management and Budget (OMB) under 
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The 
collection of information in this notice was approved under OMB control 
number 0910-0859.

    Dated: February 4, 2019.
Lowell J. Schiller,
Acting Associate Commissioner for Policy.
[FR Doc. 2019-01561 Filed 2-7-19; 8:45 am]
 BILLING CODE 4164-01-P