The Drug Quality and Security Act, approved by the Senate Monday and now awaiting the president's signature, is a far-ranging piece of legislation that sets out to address two different but very important issues facing the pharmaceutical industry. On the one hand, it lays out limited FDA powers to oversee the compounding pharmacy industry, which has spawned a cottage industry of small, specialty drug manufacturers. On the other, it kicks off the process of establishing a so-called national track-and-trace system with the intent of making it possible to eventually electronically track individual drug packages from production to patient.
"Even in the midst of partisan stalemate, Congress can still come together to pass meaningful legislation to protect the public's health," Allan Coukell, senior director of drugs and medical devices at The Pew Charitable Trusts, said in a statement. Pew has supported the new law. "Counterfeit and contaminated drugs have taken hundreds of American lives and added hundreds of millions of dollars to our nation's healthcare costs. This legislation will help protect lives and alleviate these costs by ensuring that prescription drugs are safe, effective, and of the highest quality."
Traditionally, compounding pharmacies tended to be small operations that created special formulations of drugs at the request of doctors. But in the face of drug shortages in recent years, some grew into small manufacturers which were producing sterile drugs, without doctors' prescriptions, and selling them to hospitals. As Reuters points out, some of the operators were selling nationally but were being overseen primarily by state authorities. The danger lurking from this new breed of lightly regulated player became apparent last year when an outbreak of bacterial meningitis was traced back to drugs sold around the country by the now-defunct New England Compounding Center. The outbreak sickened more than 750 people, killing more than 60.
While the FDA wanted explicit oversight over the largest compounders, the law came short of that, allowing compounders to voluntarily register and submit to FDA oversight. The idea is that hospitals will want to buy from the registered players and market forces will weed out the rest. But the law also makes it clear that the FDA can go in and inspect and take action against even those operators that do not register when there is any question that they are not following sterile and safe manufacturing practices.
The new law also became the vehicle for finally arriving at plans to set up a national track-and-trace system, a concept the industry has been wrestling with for some years. The FDA has been pushing for a system, saying it will help protect the supply chain against an increasing number of counterfeit drugs, plus make it easier to locate and recall any product that is suspect for any reason. The industry has had difficulty in figuring how how to apportion the substantial costs for an electronic system among the many players who touch a product in its movement from manufacture to final sale. That includes wholesalers, logistics companies, transportation players and pharmacies, retail and hospital.
The new law gives the industry a decade to sort the process out, with milestones along the way for getting all drugs serialized and electronic tracking equipment in place for tracing a drug's pedigree. It starts with tracking of lots, but the idea is that eventually it will be able to follow individual units through the supply chain.
- here's the Reuters story