ePedigree Delay a Sign of An Eventual Supply Chain U.N.?

StevenSimske — Thu, 20 Nov 2008 05:49:00 GMT

I have been remiss in discussing the delay in the California ePedigree until 2015. This has been interpreted as a long-term delay for track and trace and overall product safety. For a nice overview and analysis of the problem, see http://www.industryweek.com/ReadArticle.aspx?ArticleID=17793.

However, ePedigree initiatives are underway by the WHO, FDA, EU, AQSIQ (China), GS1 and other standards/regulatory organizations. A full serialization+pedigree requirement may be delayed until 2015, but it is unlikely that ePedigree will not already be in place before then. Recent passing of PRO-IP and Country-of-origin labeling (COOL) legislation in the US indicates that the US,too, will continue with initiatives before 2015.

The delay of California ePedigree legislation, moreover, may be indicative of another passing of the torch. Much as the recent Presidential (and Congressional) election results likely signal a more collaborative, less "independent" US foreign policy, the delay in ePedigree may signal a more collaborative, less independent nation-to-nation legislation in the future.

Will the big players--WHO, FDA, EU, AQSIQ, GS1, ISO, and others--work together to create a reasonable roadmap for product track and trace, pedigree and provenance? In effect, create a "United Nations" for track and trace? I, for one, hope so. With the increasingly convoluted supply chains for virtually all products resulting in chaos during recall, fraud and even normal node-node shipping situations (how many retailers can confidently tell you everywhere a product has been on its way to their shelves?), how long can it be before the legitimate market says, "enough is enough"? Plus, a universal process will reduce confusion, lower cost, and improve response time around the planet.

Is the current combination of counterfeiting, diversion, factory overrun, smuggling, return fraud and other supply chain crime the commerce equivalent of the two World Wars? A series of events so drastic that the set of collective players decides to band together into a United Nations to try to prevent such a meltdown in the future? (I realize the United Nations is by no means perfect--but we have been without nuclear combat for 63 years...). Maybe so. And maybe the delay in the California ePedigree shows that the US, rather than defining the path forward, is willing to work with the rest of the Supply Chain United Nations in formulating the optimum set of requirements moving forward.

-Steve

The Unflat Earth Strikes Again--Inspection Unflatness

StevenSimske — Sat, 25 Oct 2008 05:17:00 GMT

For this interesting article on U.S. inspection of pharma manufacturing plants, I thank my friend Pipo Caban, a systems, supply chain, manufacturing and pretty much all-around expert at HP:

http://www.newsobserver.com/1573/story/1263668.html

The article states:

"13 years is...the time it would take U.S. inspectors to visit each of 3,249 foreign manufacturing plants that make medications for the American market, according to congressional investigators...The Food and Drug Administration is nowhere near to closing an oversight gap so foreign facilities get the same scrutiny as domestic plants. Pharmaceutical factories in the U.S. get a federal inspection every 2.7 years, on average. Although the FDA will soon be placing inspectors in China and India, 'given the growth in foreign drug manufacturing for the U.S. market, and the large gaps in FDA's foreign drug inspection program, significant challenges remain,' the Government Accountability Office said in its report."

In other words, the Unflat Earth, and not the Flat Earth, strikes again. Motivation to move your manufacturing overseas? How about you get inspected 1/5 as often?

I have posted about the Unflat earth in previous blogs; specifically, the July 5th and 6th blogs this year. I'll revisit these now in light of this information.

On July 5th, I noted:

"Evasion of the local laws. Sure, every large company claims they're simply 'staying competitive' with their competition as they try to squeeze the last penny out of their costs. The truth is, most of this cost is due to finding out how the Unflat Earth (the real one, which still has countries, with different laws and rules and requirements in them) works and using it to advantage. Can you find a country with no health care costs? Great, put your assembly line there. Can you find a country with relaxed environmental laws? Excellent place for any pollutant-producing manufacturing operations. Companies aren't necessarily choosing where to place their employees based on a Flat Earth--that's just spray-on gloss to hide the Unflatness they're actually exploiting."

Add inspection to this list.

On July 6th, I added:

"The earth is not flat...yet. If you want to have engaged partners around the world, you have to work to even the playing field. Eventually, healthcare, environmental, auditing, compliance and other factors involved in selecting a spot to design, manufacture and assemble products will be more uniform. The world will be, truly, more flat. However, until that date, respectful citizens of the planet will work to improve the working conditions and environmental impact of doing business everywhere. Even if only out of self-interest, this strategy makes sense."

I also noted that increased costs of fuel might make offshoring certain types of production, manufacturing and assembly less profitable. Of course, that also makes inspection more costly, so those two will continue to trade off (if I still save more money by being inspected far less, paying less employee benefits, and not having to perform as many environmental-safety tasks, I can absorb those increased fuel costs).

But, the article goes on, into even more disturbing areas:

"The report found that the FDA isn't even sure how many foreign facilities are producing for the American market. One government database suggests it's 6,760. Another, which government officials believe to be more accurate, says about 3,000."

and...

"When FDA inspectors find problems at an overseas plant, the manufacturers usually take steps to fix them. But the report found that it can take as long as four or five years for the FDA to conduct a follow-up inspection."

I'm feeling some serious unflatness here. No wonder so many industries have been coasting down the hill of offshoring. It brings an entirely new track and trace problem to the fore. Forget about track and trace of the individual items in your supply chain (mass serialization). Forget about track and trace of all the locations your supply chain goes through (ePedigree). When you aren't even sure within a factor of two how many foreign facilities are producing for your market, you need to start at the most elemental level--find out who your partners are and get engaged with them. A very good way to ensure quality is for there to be a vested interest by all parties in the supply chain.

As Pipo notes, "[There are] so many regulations and restrictions for the locals but we are letting others control our health." In other words, the unflat regulations drive production overseas, where concern over our health is almost certainly--if not inevitably--less than it would be for locals, whose families might be customers.

Again, I am not against offshoring. Differences in distribution of raw materials, talented humans, and needs argue for responsible offshoring in most industries. But this works best if those distant workers are engaged, empowered, and "bought in" to the company performing the offshoring. It's not just about long-term economic viability of the partnership--it's about security and health.

-Steve

Security Printing and Imaging : authentication, ePedigree

ePedigree Delay a Sign of An Eventual Supply Chain U.N.?

The Unflat Earth Strikes Again--Inspection Unflatness