FDA Extends Enforcement Deadline for Drug Supply Chain Security Act (DSCSA) Requirements

 | by: Sumeet Singh, Founder & Chairman | Article Posted: September 6, 2023 |

Introduction 

The U.S. Food and Drug Administration (FDA) recently announced an extension on the enforcement of specific provisions under the Drug Supply Chain Security Act (DSCSA). The enforcement date, which was initially set for November 27, 2023, has now been pushed to November 27, 2024.  

The Goal of This Delay

This decision aims to grant additional time to trading partners and stakeholders, which encompasses drug and device manufacturers, wholesale distributors, dispensers, repackagers, to adapt and ensure efficient implementation of “electronic tracing at the package level, to achieve robust supply chain security under the DSCSA while helping ensure continued patient access to prescription drugs.” 

This move underscores the FDA’s understanding and recognition of the technical and operational challenges that trading partners might face in achieving a seamless and interoperable system by the initial 2023 deadline. 

Comment From FDA

“While FDA generally expects trading partners to have the systems and processes in place to meet these requirements as of November 27, 2023, we recognize that some technical and operational issues, including issues involving trading partners and other affected stakeholders, may not be fully resolved by that time. The Agency also understands that additional time beyond November 27, 2023 may be needed for systems to stabilize and be fully interoperable for accurate, secure, and timely electronic data exchange. This guidance is intended to provide clarity and flexibility to trading partners to help ensure continued patient access to prescription drugs as the supply chain transitions to the interoperable, electronic product tracing at the package level under the DSCSA. The compliance policies in this guidance can help trading partners throughout the supply chain implement the requirements under section 582(g)(1) of the FD&C Act by accommodating the additional time that may be needed to implement, troubleshoot, and mature their systems and processes while supporting the continued availability of products to patients.” 

Effects on Supply Chain

This one-year delay aims to provide an ample window for the pharmaceutical supply chain to stabilize its intricate systems and processes, ensuring smooth transactions across the board. The FDA is dedicated to supporting a cohesive and collaborative effort among all stakeholders in the pursuit of the DSCSA’s overarching objectives of enhancing traceability and security in the prescription drug supply chain. 

Insight from Sumeet Singh, Founder & Chairman

“The FDA’s recent delay in implementing the DSCSA highlights just how big of a challenge that changes in regulations can be for the drug supply chain”, said Sumeet Singh, CEO. “It shows that it’s not just about using new technology, but also about how we manage and support that technology. As the DSCSA steers us into an era where States will be restructuring their regulatory frameworks, the demands on supply chain entities to synchronize and strengthen their systems will further intensify. In the heart of this transformation, the convergence of technology and managed services emerges as the linchpin to navigate the evolving regulatory landscape.” 

It’s evident that with this decision, the FDA continues its commitment not just to security and traceability but also to ensuring that patient care remains at the forefront of its actions. 

The official guidance from the FDA can be read here: https://www.fda.gov/media/171592/download.

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A Comprehensive Guide to Pharmaceutical State Licensing Renewals

| by: Maria Pennings, VP of Professional Services | Article Posted: August 6, 2023 |

Introduction 

Navigating through the labyrinth of pharmaceutical state licensing renewals can be a daunting task. Licenses are not a one-and-done affair; they require regular renewal, adherence to new guidelines, and constant vigilance to avoid penalties. This September, several states have looming renewal deadlines and we’ve provided some helpful guidance below to help you prepare.   

The Importance of Timely Licensing Renewals 

Licensing renewals, often seen as a tedious task, are crucial for maintaining your operations and regulatory compliance. Late submissions can result in fees or financial penalties, compromising your financial health and reputation. The key is to prepare ahead of time and ensure your applications are submitted promptly. 

September Licensing Renewal Overview 

September is one of the largest renewal months of the year. Renewal applications are due for Delaware, Kentucky, Oklahoma, Pennsylvania, Rhode Island, Washington, Tennessee, and Utah. With so many states coming down within the same month, having your applications prepared and submitted as early as possible will save you from unnecessary penalties and last-minute stress. 

New Requirements Changes 

Oregon: As of the last renewal period, the state now requires a Foreign Qualification.  

Foreign Qualification is the process of registering your business as a ‘foreign’ entity in the state of Oregon. Although your business might not be ‘foreign’ in the traditional sense, this requirement applies if your corporation or LLC was originally established in a different state. 

How to Prepare for Your Licensing Renewal 

Gather the Necessary Documents: The first step is to collect all necessary documents. This would typically include the original license, company registration documents, proof of the business’s good standing (like the most recent annual report), and any other state-specific documents. If there are any changes in the corporation’s ownership or management, those need to be documented as well. 

Check for Updates in the Licensing Requirements: States often update their licensing requirements, so it’s important to stay informed. Check the state board’s website regularly for updates. 

Prepare your Application in Advance: Don’t wait until the last minute to prepare your application. Start as early as possible to avoid rush-hour mistakes. 

Review and Submit Your Application: Review your application thoroughly before submission to avoid potential setbacks. 

Averting Late Submission Penalties 

To avoid late submission penalties, follow these simple steps: 

Mark the Due Date on Your Calendar: Marking the date helps in early preparation and ensures that you don’t forget the deadline. 

Get Started Early: The earlier you begin, the better. This gives you ample time to gather all necessary documents, prepare the application, and account for any unexpected issues. 

Ensure All Information is Accurate: Making sure all your information is accurate can save you time and the need for resubmissions. 

The Importance of Efficient Renewal Processing

The state licensing renewal process is an integral part of maintaining your operations. It is a process that, while sometimes complex, can be navigated with efficiency and ease if approached correctly. This involves early preparation, on-time submission, and a keen awareness of new requirements. 

Preparing early allows you ample time to gather the necessary documents and get a firm grip on what the renewal process entails. Submitting your applications on time saves you from avoidable late submission penalties, safeguarding your financial health and ensuring business continuity.

Moreover, staying up-to-date with new licensing requirements ensures you remain compliant with state laws, helping to maintain your reputation and credibility. 

Contact us for help:

If you would like professional assistance maintaining your state licensing or help with your renewals, please contact us.

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Disclaimer: Pharma Solutions makes every effort to provide accurate information in the content it offers. However, the information provided is “as is” and Pharma Solutions makes no warranties, express or implied, as to the content provided. Pharma Solutions assumes no liability or responsibility for any errors or omissions in the content provided. Laws and regulations that are referenced herein may change over time and as such the content offered is not to be interpreted as advice. Pharma Solutions shall not be liable for any damages whatsoever incurred in connection with the use or performance of this information.

Kentucky has Filed Amendments to Regulations and/or New Regulations

| by: Deneen Fumich, RPh | Article Posted: July 27, 2023 |

Kentucky has filed amendments to Regulations and/or New Regulations impacting licenses and permit fees for pharmacies, wholesalers, and manufacturers along with formatting changes and additional amendments to resident and nonresident pharmacies.

There is an open comment period till August 31 with a public hearing on August 30th. Below is the summary that will impact us once approved:

201 KAR 2:050, Licenses and permits; fees.

• • increases the license/permit initial and renewal fees by $25 for pharmacies, wholesalers, and manufacturers. This amendment also ensures the fee for a change of address or change of ownership is congruent with the initial license/permit fee since those changes require a new application.
• • resident and nonresident pharmacy applications have been amended for reformatting and including additional questions regarding the website, registration status with the Secretary of State, date of last controlled substance inventory, stocking of emergency medication kits, stocking long-term care facilities, using automation for prescription dispensing and if compounding is being performed and if so, what type. For the non-resident application, pursuant to KRS 315.0351(1)(b), a question has been added to collect the names of all pharmacists who dispense prescription drugs to residents in the Commonwealth.

201 KAR 2:105. Requirements for wholesalers, medical gas wholesalers, wholesale distributors, and virtual wholesale distributors. – The wholesaler initial and renewal forms have been amended to include the proposed fee increase and to make other formatting changes.

201 KAR 2:320. Requirements for Manufacturers and Virtual Manufacturers. – This amendment revises the fee amount listed in the applications to be congruent with the proposed change in 201 KAR 2:050. This amendment also makes formatting changes.

201 KAR 2:390. Requirements for third-party logistics providers. – This amendment increases the fee for third-party logistics providers to $400. This amendment also makes formatting changes to the applications.

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Disclaimer: Pharma Solutions makes every effort to provide accurate information in the content it offers. However, the information provided is “as is” and Pharma Solutions makes no warranties, express or implied, as to the content provided. Pharma Solutions assumes no liability or responsibility for any errors or omissions in the content provided. Laws and regulations that are referenced herein may change over time and as such the content offered is not to be interpreted as advice. Pharma Solutions shall not be liable for any damages whatsoever incurred in connection with the use or performance of this information.

New FDA Clarification Allows Wholesale by 503B Facilities to 503A Pharmacies

| by: Sumeet Singh, Founder & Chairman | Article Posted: July 5, 2023 |

New FDA Statement Overview

The recent clarification from the U.S. Food and Drug Administration (FDA) regarding the distribution of compounded medications brings both positive and challenging implications for the pharmaceutical industry. On one hand, the FDA’s statement allows a 503B outsourcing facility to supply medications to a 503A pharmacy, facilitating greater access to compounded drugs based on patient prescriptions. This development is particularly significant amid the ongoing issue of drug shortages. However, it is important to acknowledge that while access to compounded medications increases, drug manufacturers, as holders of drug files, may face negative consequences in an already challenging environment. This article explores the dual impact of the FDA’s clarification, highlighting improved patient access alongside potential challenges for drug manufacturers. 

FDA Interpretation on Compounded Drugs

In its recent announcement, the FDA stated, “FDA interprets this provision to mean that a drug compounded by an outsourcing facility may be eligible for the exemptions in section 503B of the FD&C Act where the drug is distributed directly from an outsourcing facility to a health care facility, such as a hospital or clinic, where the drug is administered to a patient, or to a State-licensed pharmacy or Federal facility where the drug is dispensed pursuant to a prescription executed in accordance with section 503(b)(1) of the FD&C Act.” 

Enhancing Patient Care Amidst Drug Shortages 

The FDA’s clarification offers a glimmer of hope for the pharmacy industry, addressing the persistent problem of drug shortages. Compounded medications serve as a vital alternative when commercial options are limited or unsuitable. By allowing 503B outsourcing facilities to collaborate with 503A pharmacies, patients in need will have improved access to essential compounded medications, ensuring they receive necessary treatments based on legitimate prescriptions.

The State of Nevada recently signed SB 161 into law on June 13th which at the state level clarifies that a 503A may in fact purchase and dispense product compounded by a 503B. This development is a positive step toward meeting the evolving healthcare needs of patients.  

Expanding Opportunities for Collaboration 

The FDA’s interpretation opens up avenues for collaboration between 503B outsourcing facilities and 503A pharmacies. This partnership allows outsourcing facilities to leverage their expertise in compounding specialized medications while ensuring compliance with safety and quality standards. The 503A pharmacies, on the other hand, possess the infrastructure and patient-centric focus to effectively dispense these compounded drugs. By combining their strengths, the two sectors can work together to meet the evolving needs of patients and healthcare providers. 

Impact on Drug Manufacturers 

While expanded access to compounded medications is a positive outcome, it is important to consider the potential challenges faced by drug manufacturers. With the clarified regulations, drug manufacturers, as holders of drug files, may experience decreased sales of their commercial products, even those technically on shortage. This can add further strain to an already difficult environment for manufacturers, who invest significant resources in research, development, and regulatory compliance to bring approved drugs to market. The decrease in sales may have implications for their ability to invest in future drug development and innovation. 

The Struggle for Access to Active Pharmaceutical Ingredients: 

In addition to the impact on sales, drug manufacturers also confront the challenge of accessing necessary active pharmaceutical ingredients (APIs) to address the drug shortage. APIs serve as the primary building blocks of medications, and their availability plays a crucial role in the manufacturing process. However, supply chain disruptions, regulatory complexities, and limited global availability of certain APIs have posed challenges for manufacturers. The combination of decreased sales and difficulties in sourcing APIs intensifies the strain on drug manufacturers and their ability to meet market demands. 

Navigating a Delicate Balance 

The FDA’s clarification attempts to strike a balance between patient access to compounded medications and the challenges faced by drug manufacturers. The agency recognizes the importance of ensuring patient safety while expanding access to necessary treatments. By allowing collaboration between 503B outsourcing facilities and 503A pharmacies, the FDA seeks to address the critical need for compounded medications while maintaining oversight and regulatory control. It is crucial to find sustainable solutions that provide patients with access to necessary treatments while also supporting the viability and innovation of the pharmaceutical industry. 

Conclusion 

The recent FDA clarification regarding the distribution of compounded medications presents a mixed impact on the pharmaceutical industry. On one hand, it provides improved patient access to essential compounded treatments, addressing the ongoing issue of drug shortages. However, it also introduces potential challenges for drug manufacturers, who may experience decreased sales in an already challenging environment. As stakeholders navigate this evolving landscape, it is essential to find a delicate balance that ensures patient safety, fosters access to necessary treatments and supports the continued innovation and sustainability of the pharmaceutical industry. 

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Disclaimer: Pharma Solutions makes every effort to provide accurate information in the content it offers. However, the information provided is “as is” and Pharma Solutions makes no warranties, express or implied, as to the content provided. Pharma Solutions assumes no liability or responsibility for any errors or omissions in the content provided. Laws and regulations that are referenced herein may change over time and as such the content offered is not to be interpreted as advice. Pharma Solutions shall not be liable for any damages whatsoever incurred in connection with the use or performance of this information.

Navigating the Prescription Drug Reform Act: A New Landscape for Drug Manufacturers in Florida 

| by: Kelly DiBattista, Esq., Research Director | Article Posted: July 5, 2023 |

Introduction of FL S1550

On May 4, 2023, Florida introduced new drug price transparency legislation with the enactment of the “Prescription Drug Reform Act” (FL S1550). For drug manufacturers operating in the state, this new legislation presents both challenges and opportunities as they navigate the changing landscape. 

Reporting Requirements for Manufacturers

The core provision of the Prescription Drug Reform Act is a requirement that places a new reporting obligation on drug manufacturers. Specifically, if there is an increase of 15% or more in a drug’s wholesale acquisition cost (WAC) over the previous 12-month period, or if there is a collective rise of at least 30% over the last three calendar years, manufacturers must report these increases to the Department of Business and Professional Regulation. 

Additional Requirements for Manufacturers

Far from being a simple notice of a price increase, this report necessitates the submission of comprehensive information. Manufacturers are asked to provide the intended use of the drug, the reasons behind any price increase, information on patent extensions, and the percentage price increase from the preceding year. Furthermore, they need to specify the lifetime of the drug on the market and provide a detailed justification for the price increase. 

This new reporting obligation compels drug manufacturers to adopt a more transparent approach to pricing strategies. The requirement to disclose the reasoning behind price hikes, along with other detailed information about the drug, presents an opportunity for manufacturers to engage in a constructive dialogue about the cost of pharmaceuticals. The justifications offered in these reports will help to inform stakeholders and the public about the complexities of drug pricing and the factors that contribute to increases. 

Designation of a Primary Contact

Further augmenting the reform’s consumer protection measures, the Prescription Drug Reform Act requires the Division of Consumer Services of the Department of Financial Services to assign a primary contact for handling consumer complaints regarding pharmacy benefit managers. This new requirement underscores the need for manufacturers to work closely with pharmacy benefit managers to ensure seamless service delivery. 

Submission of Annual Attestation

Another provision that manufacturers must be aware of is the obligation of pharmacy benefits plans and programs to submit an annual attestation to the Office of Insurance Regulation. Understanding these attestations, and how they may impact their own pricing strategies, is crucial for manufacturers to navigate the new regulatory landscape. 

What Will The Outcome Look Like?

Adapting to the Prescription Drug Reform Act will undeniably pose new challenges for drug manufacturers, necessitating careful strategic planning and alterations to existing operations. The act’s regulatory requirements will create the need for manufacturers to reassess their pricing strategies and reporting mechanisms. 

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Disclaimer: Pharma Solutions makes every effort to provide accurate information in the content it offers. However, the information provided is “as is” and Pharma Solutions makes no warranties, express or implied, as to the content provided. Pharma Solutions assumes no liability or responsibility for any errors or omissions in the content provided. Laws and regulations that are referenced herein may change over time and as such the content offered is not to be interpreted as advice. Pharma Solutions shall not be liable for any damages whatsoever incurred in connection with the use or performance of this information.

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Short-Dated Drug Return Scheme Becomes Short-Dated

| by: Sumeet Singh, Founder & Chairman | Article Posted: July 5, 2023 |

Returns in the Drug Supply Chain 

Returns play a pivotal role in the intricate web of the pharmaceutical supply chain, posing unique challenges and considerations for stakeholders. As medicines move through various stages of distribution, including manufacturers, wholesalers, and pharmacies, the potential for returns arises due to factors such as damaged products, expired shelf life, recalls, and shifting market demands.  

Returns for Credit 

Historically, manufacturers accepted returns for credit and the practice has generally been grandfathered in, through today. Several factors contribute to why:  

1. 1. Manufacturers’ profitability used to be between 80% to 100%. 
   2. Wholesalers do not make demand, they’re just conduits. 
   3. Wholesalers, historically, do not make much profit such that they can’t afford to accept returns. 
   4. The advent of merged and outsized wholesalers forced manufacturers into complying with their terms. 

Short-Dated Drug Pricing 

At the same time, manufacturers and wholesalers also work to reduce loss from expired drugs. This results in bargain pricing for customers that buy the product – with the understanding that they can be sold to select customers that are able to immediately dispense drugs and ensure patients consume them before expiration, such as hospices and other long-term care facilities. 

Proliferation of Fraudulent Schemes 

Starting between 5 and 10 years ago, many returns companies have cropped up – and it is due to the joining of exactly these two aspects of the industry, Returns for Credit and Short-Dated Drug Pricing: enterprising companies have discovered they can purchase short-dated products at bargain prices, and then turn around and return those products at a profit. 

Combatting Fraud 

In a proactive effort to safeguard the integrity of healthcare systems and combat widespread abuse, at least one Big 3 drug distributor is stepping up their efforts to crack down on return fraud within the pharmaceutical industry this summer.  

This is due to several factors: 

1. 1. As profitability is dropping, manufacturers are being forced to push back on all loss-making aspects of their company. 
   2. DSCSA Serialization is bringing about the systems and data required to track and identify such schemes. 

Takeaway 

Independent pharmacies abusing the dynamic should be wary about clawbacks and return program participation termination starting this summer. 

Huge thanks to Sid Geller and Vicki Mangus for their insight!! 

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Disclaimer: Pharma Solutions makes every effort to provide accurate information in the content it offers. However, the information provided is “as is” and Pharma Solutions makes no warranties, express or implied, as to the content provided. Pharma Solutions assumes no liability or responsibility for any errors or omissions in the content provided. Laws and regulations that are referenced herein may change over time and as such the content offered is not to be interpreted as advice. Pharma Solutions shall not be liable for any damages whatsoever incurred in connection with the use or performance of this information.