**Department of Health and Human Services**

**Food and Drug Administration**

**Docket No. 2003N-0361**

**Anti-Counterfeit Drug Initiative**

**Public Comments of NNC Group**

The FDA Anti-Counterfeit Drug Task Force Interim Report of October 2,
2003, posed a number of questions for public comment including how
affected parties should be notified of counterfeit product and the
recall of counterfeit product that has found its way into the hands of
distributors, pharmacies, doctors, hospitals, clinics or consumers. The
following represent the Public Comments of NNC Group LLC.

[Executive Summary]{.underline}

It is the opinion of NNC Group that the risk of counterfeit product
permeating the US healthcare supply chain is increasing; that this risk
is significant in its current state of occurrence and impact on public
health and safety; and that while we are optimistic that technologies,
policies, and voluntary efforts by the participants in the supply chain
will ultimately succeed in reducing the threat posed by counterfeit
product, these developments will take considerable amounts of time and
resources to fully define and implement.

Secondly, even as the chosen means of deterrence and protection are
developed and employed, the economic attraction of the U.S.
pharmaceutical market will continue to draw the attention of unethical
and/or criminal elements of society. Technology advances are unbiased in
their ability to be employed for good or evil purposes, and the need to
have a diligent means of communicating the pollution of the genuine
supply of drugs with illicit product will be an ongoing requirement.

Finally, based upon our experience in executing product recalls on
behalf of many manufacturers, the risks posed by dangerous, ineffective,
and broken chain of custody product should be viewed as an adverse event
from a public health and safety perspective.

The manufacturer did not manufacture the product, and the guidelines
that might call for conducting a voluntary recall under 21 CFR Part 7 do
not apply in the sense of their owning the responsibility for the
problem. Nonetheless, the risk of counterfeit product from a health and
safety perspective are greater than labeling, sterility, stability, or
other problems that are regularly and voluntarily identified and
reported by ethical and responsible manufacturers. The criminal
organizations that produce counterfeit product have no concern other
than eluding detection and obtaining illegal profits, no matter what the
impact may be on the ultimate consumer of the drug. NNC envisions the
need for measures that would unite the industry and federal government
in forming and funding a cooperative effort to notify the public,
industry, and health care providers of an identified counterfeit event,
and then to be able to take appropriate actions to recover and isolate
as much of the known product as possible. These anti-counterfeit
procedures must prove to be equally effective to today's legitimate
product recall regulations in preventing serious health risks to US
consumers.

SPECIFIC CONCEPTS BEHIND NNC's PERSPECTIVE ON THE REQUIREMENTS FOR
EFFECTIVE COUNTERFEIT PRODUCT ALERTS TO REACH CONSUMERS AND OTHER
AFFECTED PARTIES

Consumers, healthcare providers, distributors and manufacturers should
be able to participate in an industry wide counterfeit alert system that
enables the rapid delivery of consistent information, with clear
instructions on what actions should be taken. This system should be an
active notification/response system that does not rely solely on passive
means to reach critical parties and the general public. Validated,
scalable notification/response systems are serving pharmaceutical and
medical device manufacturers today using multiple communication
channels. These process driven systems are capable of delivering
information tailored to specific audiences including consumers,
practitioners, retailers, wholesalers or distributors within hours of
initiating the alert notice.

Once a decision has been made to notify the public of a counterfeit
product, the recovery and return of counterfeit product should be done
in an efficient, effective manner so as to minimize the chance that any
significant amount may potentially reach consumers. In certain
circumstances the task of executing the recall of counterfeit product
may fall to an organization with little or no experience in executing a
complex and voluminous process. The current reliance on small and
unsophisticated firms at the edge of the distribution chain to recall
counterfeit product could cause problems in making sure adequate
notification reaches all known recipients of the counterfeit product,
and that as much of the counterfeit product as possible is recovered and
accounted for.

It is also extremely important to design and deliver consistent messages
in a manner that are easily understood, meaningful, and most likely to
gain the attention of the recipient. The process must also provide
simple, accessible, and reliable means for a recipient to respond
quickly and effectively. Multiple notification channels are often
required to reach as many of the intended recipients as possible, and
may involve telephone, fax, the Internet, and physically delivered paper
documents. Such notifications contain specific information and precise
instructions for the recipient. Notifications may be as timely, as
urgent and as detailed as circumstances warrant. Instructions to
recipients should be clear and unambiguous. Return of the product should
be simple, secure and immediate, with no lapse of time between receipt
of the notice and return shipment of the product.

Finally, there should be requirements for storage, document retention,
inspection and final disposal or destruction of counterfeit product. The
ability to isolate product for analysis, identification of manufacture
source and location, as well as any required confidential forensic
investigations, should be consistent across all occurrences, regardless
of type of product or affected authentic manufacturer.

In short, existing technologies and business processes exist and are
used on a daily basis for the effective, efficient notification of
affected parties and for the removal of counterfeit product from the
normal channels of commerce.

NNC Group has handled more than 500 recalls of pharmaceutical and
medical device products for some of the world's largest pharmaceutical
and medical device manufacturers. NNC Group's experience in handling
recalls, including those of counterfeit product, has shaped our comments
on some of the specific questions posed by the authors of the FDA
Counterfeit Drug Task Force Interim Report.

[**Questions related to the potential options for improving prescription
drug security**.]{.underline}

**Questions Concerning Technology**

> [Discuss the advantages and disadvantages and the role of track and
> trace technologies, in particular bar codes and RFID.]{.underline}
>
> Track and trace technologies, such as RFID, hold boundless promise.
> However, for RFID to be truly effective, significant infrastructure
> investments must be made by all participants in the supply chain along
> with the development of consistent standards, platforms and data
> requirements for all trading partners. Further, the RFID tags affixed
> to each piece of product must be able to transmit a signal strong
> enough that it can be read when the product is in the middle of a
> densely packed pallet. Bar code technology has been in use for over
> twenty years. Over that period of time manufacturers and retailers
> have refined and improved the technology and the data it collects to
> improve their ability to manage inventory. To work effectively, bar
> codes require line of sight. In all instances, technology holds
> promise to address some of the challenges associated with product
> movement. Unfortunately, significant investments of time and money
> will be required to devise and implement specific technology solutions
> for counterfeit product. The challenge of counterfeit product requires
> the development of solutions and processes that work today.
>
> [What are the costs and challenges involved with setting up an
> infrastructure for utilizing various track and trace
> technologies?]{.underline}
>
> The biggest challenges to setting up the infrastructure for track and
> trace technologies are:

1.  Agreement on acceptable and deployable standards. In spite of the
    recent press relative to track and trace technologies, the lack of
    agreement on standards will impede the adoption of the technology.
    According to recent data from a September 2003 survey by Forrester
    Research, over 70% of the firms responding did not have a deployment
    plan identified for adopting RFID technology into their operations.

2.  Costs of deployment. Given the resistance from some sectors of the
    health care supply chain to adopt bar codes for hospital unit dosage
    packaging, based on costs, it is certain that the significantly
    higher costs to adopt new technology will hinder rapid deployment of
    track and trace technology for some time.

3.  Normal adoption timeframes for new technologies, even accelerated,
    are measured in years, not months. The technology industry has two
    famous "laws" that drive it; Moore's Law, which is related to the
    pace of innovation and costs of individual components of technology,
    primarily microprocessors speeds and scale, and Metcalfe's Law,
    which relates to the exponential increases in value of networks
    based upon adoption and usage, e.g. faxes, the Internet, etc. One
    can compare the relative adoption rate of bar codes (approx. 25
    years) and VHS tapes (approx 18 years) in terms of ubiquity, to the
    adoption of RFID and DVD replacement technologies. The good news is
    that DVD technology has gained sufficient adoption to become the de
    facto standard within about 6 years; the bad news from an RFID
    adoption standpoint is that it may be a similar time period for
    track and trace to fully establish itself as a better and equally
    cost effective replacement for bar codes.

4.  Lack of agreement as to which track and trace technology is
    appropriate. At the public hearing there were no definitive
    agreements among the key stakeholders on what constitutes the most
    appropriate and affordable means of tracking product through the
    supply chain. While RFID would seem to be the leading candidate, and
    NNC views this as most appropriate as well, this is not a generally
    agreed upon approach.

**Questions concerning rapid alert and response systems**

[What are the current capabilities of private communication systems or
networks for handling information about counterfeit drugs in a timely
manner?]{.underline}

> Currently, many communication systems exist that allow for the rapid
> dissemination of information to selected audiences. However, the
> unique challenges of notifying appropriate parties of an incidence of
> counterfeit drug and recalling counterfeit drug require a
> communication system that delivers consistent information over a
> medium appropriate to the recipient and that collects the time manner
> and place by which a recipient is notified and responds in a database
> that is actionable. An appropriate communication system for
> counterfeit product should be a notification/response system that
> incorporates telephone, facsimile, traceable direct delivery and
> e-mail. The communication system should tailor the information to fit
> the selected medium for the intended audience and allow the recipient
> to respond to the notification and take appropriate action. NNC Group
> manages a validated, scalable notification/response system that is
> used daily by nine of the top ten of the world's pharmaceutical
> manufacturers and six of the top ten medical device manufacturers to
> handle notification/response for product recalls. NNC Group's
> notification/response tools are linked directly to a product
> tracking/inventory/reimbursement/replacement/disposal solution for
> seamless data integration and project lifecycle management. The
> solution is available 24/7/365.

[What capabilities should a communication network have in order to be
part of a counterfeit alert system? Should the system be accessible to
all stakeholders? How fast should the system be able to disseminate
information about suspect product? Should messaging be active? How
should the system flag messages about suspect product as opposed to less
urgent information? Should access be at no cost? Should all networks in
the system have a uniform method of presenting and distributing
information? How secure must the system be? Should access to information
be selective? Should the system be capable of direct linkage to FDA?
Should the system be able to transmit educational
information?]{.underline}

> A communication network for counterfeit product should be capable of
> notifying an event specific number of consignees by phone, facsimile,
> traceable direct delivery and e-mail. The system should be able to
> deliver information consistently and repeatedly regardless of
> communication device. The system should be able to confirm
> notification delivery and provide a means for consignee response.
> Consignee responses should be directed to an appropriate resource for
> action. The system should be able to differentiate urgency and form of
> the message depending on the issue at hand. The system must be able to
> avoid "alert fatigue", which means matching the urgency of
> notification to the severity of the issue, and one that has not
> overused methods or frequencies that might create indifference or
> doubt on the part of the consignees who are affected. The system
> should be a secure system with access limited to those parties who can
> make an appropriate determination regarding a course of action
> relative to a counterfeit product. It would appear that manufacturers
> and the FDA would be the appropriate parties to have access to the
> system to initiate a notification and to have access to the reports
> made available by the system regarding successful notifications and
> consignee actions based on notifications. NNC Group currently manages
> a secure, validated, scalable notification/response system for
> pharmaceutical and medical device manufacturers that is used on a
> daily basis for alerting consignees about product recalls. In
> addition, NNC Group serves as the independent third party manager of a
> system developed by manufacturers and patients to notify those
> patients regarding issues of product stability and product recalls.
> This particular system allows for the patients to register and select
> the means of notification. Patient information remains confidential.
> Manufacturers have access to the system only to initiate a
> notification. NNC Group manages the system to ensure successful
> notifications, patient registrations, registration changes and other
> details.

[What are the costs associated with developing a new counterfeit alert
network? What are the costs associated with adapting current systems or
networks to be part of a counterfeit alert network?]{.underline}

> In the opinion of NNC Group, FDA does not need to develop new
> technologies or systems to implement a counterfeit alert network.
> Currently, NNC Group manages systems designed to meet the objectives
> of the counterfeit alert system that serve the major pharmaceutical
> and medical device manufacturers on a daily basis. The costs of
> modifying that system to ensure appropriate levels of access and
> security are in place are minimal. The current NNC Group systems and
> technologies allow for the notification of hundreds or millions of
> consignees within hours. The notification process includes a consignee
> response mechanism. The notification of and response by consignees are
> used to populate a database that is used by the customer to determine
> the success of an action and what additional steps if any should be
> undertaken. Lastly, NNC Group is committed to the adoption of new
> technologies, particularly track and trace logistics technologies, as
> part of the overall process and system offering.

**Questions concerning education and public awareness**

[Once a counterfeit drug is identified, what tools are available to the
agency to notify potentially affected parties without inappropriately
scaring other consumers from taking their medications?]{.underline}

> The challenge with counterfeit drugs is the ability to define the
> scope of any specific counterfeit issue. One specific solution to the
> issue of counterfeit drugs could be the creation of patient registries
> for prescription drugs. A registry system would allow notifications
> directly to consumers regarding a particular product thereby
> minimizing the use of traditional media sources to notify the public
> of an instance of counterfeit drugs. In the absence of patient
> registries, traditional notification/response systems such as those
> used by NNC Group can be tailored to alert specific audiences be they
> consumers, wholesalers, retailers or distributors about an instance of
> counterfeit product. Due to the capacity and flexibility of the
> validated scalable nature of NNC Group's systems, counterfeit
> notifications can be delivered within hours of the identification of a
> counterfeit product, thereby maximizing the recovery of counterfeit
> product that is still in the distribution or retail channels and
> minimizing the need for public notification. NNC Group's
> notification/response system can be and is used for geographically
> focused notifications. In the event of a counterfeit product,
> notifications can be delivered to the appropriate parties within a
> defined geographic area maximizing recovery of counterfeit product and
> minimizing the need for national broadcasts of information.

[How should these efforts be supported or funded? Is partnership with
potentially affected parties appropriate?]{.underline}

> It would appear in the case of counterfeit product where public policy
> objectives and private sector interests are closely aligned that a
> funding model using public and private funds would be appropriate.
> Since no specific manufacturer, or any other stakeholder within the
> legitimate supply chain system can be identified as a likely target or
> victim of a counterfeit organization, cooperative initiatives at the
> industry consortium level would be appropriate.