Piloting Toward Success

Drug firms speak about their success with RFID—and its limitations—at the EPCglobal U.S. Conference 2006.

By Daphne Allen, Editor
Senior executives representing a broad range of industries addressed 1300 attendees at the general session of the EPCglobal U.S. Conference 2006. "Industries are increasingly turning to EPC/RFID to drive topline business growth, improve product availability, protect supply chains, and reduce supply chain costs," said Mike Meranda, president of EPCglobal U.S., as he opened the general session.

RFID is not just hype—the technology works. But there is still work to do to make it scalable.” Suzanne Hyer, global RFID analyst for GlaxoSmithKline (GSK), shared such insight at October’s EPCglobal U.S. Conference 2006 in Los Angeles. Hyer joined other drug manufacturers at the event to share their pilot experiences and their future hopes for RFID. Also speaking about RFID were representatives from AstraZeneca and Pfizer, who have also managed pilots, as well as a representative from Novartis.

Hyer detailed GSK’s RFID pilot for the company’s antiviral cocktail for HIV, Trizivir. Starting in March 2006 and running through July 2006, the pilot involved placing high-frequency (HF) RFID tags onto bottles and ultrahigh-frequency (UHF) tags onto cases of 48 bottles. As the bottles and cases were packed at GSK’s Zebulon, NC, manufacturing and packaging plant and then shipped to its Durham, NC, distribution center (DC), their tags were read and their locations recorded. “We were treating this as though the products were going to our distributor, but it really took place just within our own four walls,” explained Hyer. HF tunnels read the item-level tags on the bottles, and UHF readers identified the case tags, she says. Products were then repalletized at the DC and stored.

“Our read rates were 99%,” said Hyer, “but they really need to be 99.9% for Six Sigma.” The important thing, she said, was that the RFID tagging and reading did not slow down the packaging lines. HF failures occurred mainly after tags were applied to bottles, averaging a failure rate of 0.5%. “It needs to be 0.1%,” she said.

AstraZeneca’s senior manager, corporate packaging technical services, Michael Forehand said that during his company’s pilot, they decided to overlay their RFID solution onto their packaging line. “But there was not enough time to write to the tag in the labeler in-feed, so we built an encoding station on the open conveyor downstream from the labeler,” he explained.

The equipment on that packaging line also had to be equipped to communicate RFID data. “A lot of equipment was talking, and a lot of data were flying around,” he said. “Timing that data is key.”

AstraZeneca’s pilot lasted nine months, five of which were spent on system design and tag-label development. “We paid for our vendors to learn about RFID,” Forehand said.

Handling defects was also a learning experience, says Forehand. “With RFID rejects, sometimes the cause of the reject is not immediately clear,” he said.

Speaking about perhaps the most well-known RFID pilot, Peggy Staver, Pfizer’s director of trade product integrity, said the company’s RFID strategy team set out in 2004 to tag all Viagra by the end of 2005. “We sought to provide a means to authenticate at the pharmacy,” she said.

Pfizer made the following key technology decisions (some of which may have set the pace for other companies):

• HF tags used for bottles.

• UHF tags used for cases and pallets.

• Two-dimensional Data Matrix codes used to back up RFID.

• No prewritten slap-and-ship tags.

• No National Drug Codes (NDC) encoded in the electronic product code (EPC) for privacy reasons.

• Labels also feature color-shifting bars and logos.

According to EPCglobal, by 2010, the market for RFID within the healthcare sector will reach $8.8 billion. EPCglobal Inc. is a neutral, not-for-profit standards organization consisting of nearly 1000 manufacturers, technology solution providers and retailers around the world.

To date, Pfizer has had more than 200,000 Viagra authentications made, Staver said. Incidentally, no counterfeits have been uncovered through such authentication, she said. After spending about $5 million, Pfizer has no plans to move from HF. “As we move to other products in our portfolio, we will take a risk-based approach,” she said.

GSK is still tagging Trizivir and has no plans to stop, said Hyer. “We are focusing on improving read rates and resolving some software and hardware issues.”

Speakers agreed that industry and its trading partners need to unite on several issues. “We need standards for item-level tags brought forth by the whole supply chain,” Forehand.

And several technology issues need to be resolved, such as “RFID use in the cold chain and near telemetry,” Staver said. Added Forehand: “We need to define technology gaps.”

RFID adoption “hinges on strong value propositions and regulatory mandates,” Staver concluded. “At a minimum, we believe that serialization will be required.”
Once mass serialization is adopted, said Hyer, GSK and other drug companies should be able to rely on RFID to perform the following tasks:

• Gather data on product diversion.

• Manage recalls.

• Develop market intelligence.

• Ensure patient safety.

• Build a safe and secure supply chain.

Marc Bechet, head of global tech operations, IT, for Novartis Pharma AG, spoke about the need to “protect our brands and the significant investment we’ve made in them.” He also lamented the “erosion of public trust in and support of” the pharmaceutical industry, saying that “counterfeiting doesn’t help at all.”

There are compelling reasons for track-and-trace technology, but it is only a tool, he cautioned. To achieve a safe and secure supply chain, two questions have to be answered reliably: Is the product genuine? Is the chain of custody intact?

Possible components of mass serialization are Data Matrix codes, bar codes, and RFID. “We need to invest, but also manage risk.”


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