Florida's Pharma Deadline Puts Spotlight On Item-Level RFID

As Florida prepares for a new law that requires pharmaceutical distributors to document who takes possession of prescription drugs as they travel from manufacturers to retail shelves, an industry debate rages on over the type of radio frequency identification technology best suited to secure the supply pipeline. Enforcement of the law is set to begin July 1.

RFID industry leaders ADT/Tyco Fire & Security, Alien, Impinj, Intel, Symbol and Xterprise sponsored a white paper released Thursday presenting an argument meant to dispel myths about the newer short-range RFID technology known as ultra high frequency (UHF) vs. high frequency (HF), which has been around for years.

"There is a legitimate debate that UHF can work for item-level tagging to protect the pharmaceutical industry and consumers against drug counterfeiting," said Reik Read, senior research analyst at equity research firm Robert W. Baird & Co.

Many companies already use HF RFID in the retail supply chain to tag carton and pallets. But early adopter Wal-Mart Stores Inc. has been an early proponent of UHF technology. Read thinks there's a good chance the industry might see dual-frequency RFID readers from manufacturers to read both types of tags.

A view held by some experts is UHF RFID for pharmaceutical item-level tagging isn't acceptable because when using HF RFID tags liquid absorbs and metal retracts the RF signal, making it difficult for equipment to read the tag. Another view is UHF lacks data security, making it easier to intercept information across wireless networks.

Not true, said Vinay Gokhale, vice president of business development at Impinj Inc. "The security protocol is independent of the RFID Gen 2 protocol, so it can be added to a UHF system just as easily as it could to a HF system."

Gokhale said UHF Gen 2 readers never transmit the electronic product code (EPC) stored on the tag, which identifies the product. The only time the product code transmits from the tag is when the tag responds to the reader device with something called "cover coding," a specific algorithm that includes a password set by supplier or retailer.

Companies in the retail industry and government agencies, such as the Department of Defense, are deploying RFID projects to track inventory through the supply chain. But none are as important as protecting the prescription drug supply chain.

Globally, drug counterfeiting is a $32 billion a year business, and between 8 percent and 10 percent of the global medicine supply chain is counterfeit, estimates the World Health Organization.

Randall Lutter, U.S. Food and Drug Administration associate commissioner for policy and planning, told attendees at the RFID World 2006 conference in March the department's criminal office of investigations opened 38 counterfeit drug cases in 2005, and estimates nearly 4 billion prescriptions were filled that year.

But a report issues by the Government Accountability Office (GAO) in March states the FDA needs to improve the management and oversight of drug safety. The report scrutinizes the FDA's organizational structure and drug-safety decision-making processes.

Legislation introduced into the Senate earlier this year, if passed, would require all manufacturers to use counterfeit-resistant technologies when packaging and shipping prescription drugs throughout the United States.