Don't Lose Sight of RFID

When it comes to drug serialization today, 2-D bar coding seems to dominate most discussions. "There's more gravitational interest in 2-D bar coding," notes Reik Read, managing director and senior analyst, supply chain technology, Robert W. Baird & Co. "It does the job, and it is understood."

Could a new ISO standard for RFID tagging change that? ISO 17367:2009, Supply chain applications of RFID - Product tagging, which defines the basic product tagging features of RFID for use in the supply chain, was issued in late February.

"People are hungry for standards," he says. "When standards come out, it is difficult to know their impact. But ISO offers a good framework for dealing with data issues."

For instance, explains June Ruby of Motorola, "standards, such as ISO 17367:2009, provide a method for consistent and predictable data exchange between supply-chain partners and will be a catalyst for realizing the promise of end-to-end traceability." (Motorola's fixed and mobile scanners and RFID readers can be used by manufacturers to track raw materials, work in process, and finished goods within their internal process as well as to provide their partners with critical supply chain data.)

One sticking point for pharma has been industry's doubt that Six Sigma performance can be achieved during data capture on packaging lines. But Read believes users can achieve it-they just may need some customization on their lines.

"Pharma needs to see RFID proven in other industries to believe it," he says. For instance, "there's an awful lot of Gen2 RFID pilot activity in apparel and a clear value add. One vendor, for instance, is savings 15 hours of labor per week per sales person, or about 35% of the average sales work week. The savings is being redeployed and is allowing the average salesman to cover more accounts."

In addition, people and asset tracking have been going on for a long time--maybe for 10 years, says Read. "Better asset utilization has allowed hospitals to defer capital expenditures, which has been helpful during this economic downturn," he notes. "And nurses spend more time nursing instead of tracking items."

Distributors in particular have advocated RFID use for some time. "To read 2-D bar codes, distributors have to throw a lot more labor at it than they would if they used RFID. With bar codes, every item needs to get scanned. RFID could really be a nice benefit in terms of labor and tracking inventory," Read says.

But while drug manufacturers and distributors have collaborated in several RFID pilots in the past years, manufacturer interest in RFID has waned.

"When big pharma starts to see value in RFID, such as meaningful savings and increased sales, that's when you'll see a change in thinking. Manufacturers have to acknowledge that 'maybe our operations are not as efficient as we thought,' " he says.

For instance, if a drug or medical device company's sales force spends most of its time on track-and-trace administration issues, that could be a good catch point, Read points out.

For now, 2-D bar coding is captivating drug serializers. And its use may certainly remain a staple for redundancy. But as supply-chain partners push the benefits of non-line-of-sight data capture--and as drug companies themselves begin to seek greater inventory and tracking efficiencies--RFID may one day burst back into the pharma scene.

After all, FDA and other regulators still mention RFID in future and pending rules. To remain poised for change--and to stay competitive--you may not want to leave RFID completely out of sight.

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