Pharmaceuticals Export Promotion Council
(Setup by Ministry of Commerce & Industry, Govt. of India)
Dt:08.April.2011
To
Shri Rajeev Kher,IAS
Additional Secretary
Department of Commerce
Ministry of Commerce & Industry
Govt. of India
New Delhi
Dear Sir,
Sub: Comments of Pharmexcil on DGFT Notification Dt.10.01.2011 on Trace & Track Technology
This has reference to the discussions in the meeting held on 10.March.2011 under the Chairmanship of your goodself on the above subject. In this regard, we have invited comments from all members.A final report consisting of various constraints & suggestions/recommendations by the Council is enclosed for your kind information.
With regards,
Dr.P.V.Appaji
Executive Director
Comments of Pharmexcil on DGFT Notification Dt.10.01.2011 on Trace & Track Technology
Sub.: Public notice dated 10th January 2011 issued by DGFT relating to tracing and tracking of exported consignment of medicines- Comments by Pharmexcil submitted
A. Para-wise comments of the above notification given below:
Para 3 (or Serial Number 3) – ‘Exporter of Pharmaceutical products will build track and trace capability for their exported medicines using barcode technology as per GS 1 global standards. The same will need to be done at Primary, Secondary & Tertiary level packaging labels as per details below –
3.a. Primary Level packaging – Incorporation of 2D (GS 1 Data matrix) barcodes on medicines at strip/vial/bottle level encoding unique product identification code (GTIN), Batch Number, Expiry Date and Serial Number of the Primary pack
Concerns:
a.1. For Export of medicines, “Text matter” on the ‘Label’ (ampoule, vial or bottle) or ‘Strip’ is approved by each individual country (according to the regulations in that country). To change the approved label (or to add extra text / bar code) will require permission from respective country. Manufacturer will have to apply for each product in each individual country separately to obtain such permission – Changes in the ‘Label’ can be implemented ONLY after receiving approval from regulatory authority of respective country.
a.2. Many times, the size of Label / Strip is small and space is not enough for mentioning the basic details such as “Brand name, generic name, composition, manufacturer’s name, batch no., exp. date, size, etc.” In addition to this basic requirement, incorporation of additional Bar Code will be difficult / may not be possible.
a.3. Bar code is required with ‘Serial Number of the primary pack’ – To include Serial number in the bar code, sophisticated on line bar code generating machine (equipment) will be required. Also such machine will be required for each packaging line separately.
Manufacturer will have to procure number of such sophisticated barcode generating and printing machines and will have to modify the packaging lines – which involve cost & will require time for such modifications.
Many times the primary units are produced in a large quantity (based on the batch size – generally in few lakhs quantity) and then primary packing is carried out using number of primary packaging lines (machines). In such case, serial numbering of primary pack will not be possible (since the primary packs are produced on number of packaging lines simultaneously).
a.4. Any wear and tear of the primary pack (either the container/strip or the packaging material) after packaging & bar coding is complete will mean missing out of that serial number in the final export consignment. This can not be tracked without additional stress on the schedule and additional equipment usage / man power wastage to note down such details.
3.b. Secondary Level packaging – Incorporation of barcodes (1D or 2D) encoding unique product identification code (GTIN), Batch Number, Expiry Date and Serial Number of the Secondary pack.
Concerns:
b.1. As mentioned in the point no. 1 of primary level packaging, the text on secondary level packaging is also approved by each individual country. To change the approved label (or to add extra text / bar code) will require permission from respective country. Manufacturer will have to apply for each product in each individual country separately to obtain such permission. – Changes can be implemented ONLY after receiving approval from regulatory authority of respective country.
b.2. Normally the secondary packaging is done manually by multiple personnel. Hence the serial numbers on the barcodes will be difficult to incorporate. This also will need a sophisticated barcode generating and printing machine in addition to the one required for primary packaging, specially designed for such packaging.
b.3. Even in case of automatic secondary packaging, multiple lines are used and the same numbers of barcode machines will be required.
b.4. Any wear and tear of the secondary pack (either the primary pack or the packaging material) after packaging & bar coding is complete will mean missing out of that serial number in the final export consignment. This can not be tracked without additional stress on the schedule and additional equipment usage / man power wastage to note down such details.
3.c. Tertiary Level packaging – Incorporation of barcodes (1D) encoding unique product identification code (GTIN), Batch Number, Expiry Date and Serial Number of the Tertiary pack (shipper / carton).
Concerns:
c.1. The carton / shipper may not be labeled, the details are many times stenciled or printed on the tertiary packaging as the tertiary packaging material is mostly of corrugated cardboards from which the sticker labels get peeled off.
c.2. To generate bar codes with the serial numbers for the tertiary packaging separate barcode generating and printing machines will be required. This too adds to the cost and work load.
General Concerns:
This entire exercise will require huge investment in machinery and technology.
Such sophisticated machines are not available locally and require to be imported in a large quantity to cater the needs of about 3500 exporters.
The work load, man-hours for each operation will increase considerably
The efficiency of production will reduce significantly
This will lead to higher manufacturing cost and is against industry’s interest for competing against the competitors in international markets.
SMEs will not be able to cope up with the additional investment cost.
Such system is not followed even by the International manufacturers.
Above everything, there is no justifiable significant advantage of implementing such procedures as the main goal of tracking the individual pack is not ensured.
Moreover, not all products or drugs need to be monitored so strictly or stringently at the packaged levels as the finished goods are well monitored and documented otherwise.
Additional Points:
1. Along with small ‘Label and Strip’, the space constraint is also applicable for small tubes.
2. Export of Pharmaceutical products is very high (about 10 billion US$) – this entire Export will be at stake.
3. Fast moving products are manufactured with proper forecasting. There will be a huge stock of finished goods which will be manufactured before 1st July 2011. Permission shall be given for export of goods manufactured before 1st July 2011.
4. Approval for incorporation of such code on Primary & Secondary pack will be required in many importing countries. Such approval will require about 9 to 12 months.
5. Primary packs shall be exempted from these requirements.
6. Such system of bar coding is not implemented in any other country.
7. Bar coding for Export products must comply with the requirements and the system adopted by the Importing country.
8. The proposed Bar code system may not be acceptable to the Importing country.
9. As per the Report published by CDSCO, the percentage of Spurious Drugs is only 0.046%.
10. Such notification should be simultaneously published / issued by Ministry of Health & Family Welfare.
11. Many Indian companies are manufacturing products of Foreign companies on Contract manufacturing (neutral labeling) and such requirements of bar code are not asked by these companies.
12. In many CIS countries (Russia, Ukraine, Kazakhstan), sample of each batch is tested as per the approved documents including checking of Text, Colour, Design of Primary & Secondary pack as per the approved art works.
13. Present GS1 13 digit (1D) Bar Code used in almost all Importing countries, contains details of the country of manufacture, name of manufacturer, product name and unit pack Batch no., Mfg. Date, Expiry Date and Mfg. Lic. No. is in any case printed on both the primary and secondary packs as per the requirements of Drugs & Cosmetics Act and Rules. This is adequate to track and trace the product right up to the manufacturer.
14. There is no guarantee that the proposed 2D bar coding system cannot be counterfeited and duplicated.
15. Efforts shall be made to evolve a “Global Track and Traceability” programme using a harmonized bar coding system which will be acceptable to all countries across the globe rather than impose a Unilateral Standard which is sure to create problems and will not be acceptable to the Importing countries.
16. Joseph Ringwood, COO - Systech International (NJ, US) had this to say regarding the Foreign Trade Ministry Serialization announcement:
We serve the global serialization market. This emerging regulation from India is than that being implemented in Turkey and actually resembles California legislation. A key point to be made is that the track and trace requirements do not specify infrastructure or the need to capture data and maintain it in any type of database for queries. This type of serialization is useless unless the product can at the very least be authenticated.”
17. The cost of the equipment for implementing the trace and track technology per line is Rs.35.79 lacs.In addition to this, annual maintenance costs towards software, about 15% of the software costs has to be incurred. Small and medium drug companies will find it extremely difficult to implement it from the cost point of view.
18. Observations:
1) In overseas markets also variable barcodings are not printed. Only specific product linear barcodes are specified as mandatory requirement in some of the markets
2) Barcoding on tertiary packs would serve no purpose as the same boxes are not always used. Further in the distribution channel/and are often repacked.
3) In most of the countries Secondary packaging is the unit for sale, therefore there is no need for barcoding on primary packs
B. Current International Status:
1) No other country is following the systems prescribed by DGFT.
2) France has notified about 2D coding in March 2007 and provided four years time frame for implementation.
3) Developed markets in EU and America do not insist on 2D barcodes on export packs with variable data.
4) The coding and serialization requirements have just begun from 2010 only. About 10 countries have started/announced implementation of this solution. Adequate time is provided by several countries. The position is explained below,
C. List of Remarks/Problems & Constraints as received from various members:
1) Majority of the Ayurvedic formulations are exported as food/food supplements and personal care products. The counterfeit/misbranded/spurious drugs are not an occurrence in traditional medicines. Keeping traditional medicine which are covered under the purview of Drugs & Cosmetics Act to sophisticated tracking technology is totally unnecessary
2) To revise printed components involving several labels of exported medicines to accommodate barcodes. This will have impact on timelines
3) To write off existing old inventories and to create new inventories
4) Regulatory approvals from importing country would take considerable time
5) Need to build infrastructure, serialisation, printing of 2D barcode etc
6) New installations are required
7) Cartons are saleable packs in International markets
8) Serialization on primary packs is not done internationally
9) There are no added guidelines provided on implementation of trace & track 2D code for the pharmaceutical manufacturers
10) Barcode generating and printing machines to be purchased for each packaging lines involving huge investments
11) Separate machines will be required from primary, secondary, tertiary packaging sections again contributing to high costs
12) It is important to decide the agency who will allot the codes(UPIC) to the companies for printing barcodes
13) Due to exorbitant capital and recurring costs, most of the exports from SME sector will become unremunerative rendering them out of export business
14) The Commerce Ministry in Russia has reportedly denied permission to print the barcoding on primary packaging(labels)
15) Several problems are involved with barcoding incorporation on primary packs
16) Changes in the label can be implemented only after receiving approval from the regulatory authority of respective country
17) Many times sufficient space is not available for incorporation of complete information on primary labels
18) The agency who will handle track & trace data is not notified
19) There should be a vendors list approved by DGFT/GS1 for providing Unique Identification Code
20) Very difficult to comply by traders/merchant exporters
21) Difficult to have more than one code on the pack if the receiving market legislation also requires its own mechanism
22) Compliance with the rigid requirements specified in the notification in terms of realistic implementation time
D. Suggestion received from various members:
- Hidden hologram which can be pre-printed on the carton would be advantageous as no extra cost and time is involved at the manufacturers end
- 2D Barcoding may be implemented for secondary packaging instead on primary packaging
- Requirement for serial number on cartons may be waived off
- System required to be introduced in a phased manner and may be made applicable,to start with trading/export houses having highest rankings
- Procedure for barcoding in case of medicines exported for neutral label/for repackaging purposes
- Serialisation need not be insisted.
- Serial number may not be insisted for tertiary packaging
- The cost incurred by SMEs may be reimbursed by Commerce Ministry and, may be under Brand India fund
- Prior education/training of the small scale sector to make them ready for compliance is required. The Govt. needs to organise awareness programmes/workshops with sufficient time gap.
- To provide timelines for implementation due to cost implications
- Clear guidelines for implementation are required
- Barcoding for primary packaging not advisable as it is nowhere done globally
- Incorporating trace and track system by printing random code on each unit pack would help industry as the end user. End user verification is convenient if a toll free SMS contact number is provided
E. Summary of Major Constraints observed from the Notification:
In view of the difficulties faced by the industry to implement the recommendation of the DGFT at a short notice on the following parameters:
a) Time lines required to adopt to technology which has to be adopted for all levels of packing
b) Time to change the pack art works at all levels of packing with different importing countries across the world where the Indian companies export to.
c) Huge investment cost involved in the changes to be brought in at the packing lines level for primary/secondary packing.
d) Importing countries having specific requirements in the primary and secondary packing for bar coding which is different than the requirements of the GS1.
e) All regulatory countries have the site approval and product dossiers mechanism in place to implement track & traceability in the existing forum is not possible and not required at all.
F. Suggestions by Pharmexcil for Amendments to the Notification:
1. Primary pack which is a blister/strip/ vial shall be exempted since it requires huge investment and regulatory approvals. Also cost of pack will increase since the blister size needs to be increased to accommodate space for barcode. Also it has a cascading effect on cartons / shippers
2. Track & Trace is to be implemented without serialization at carton level at marketable unit pack. {E.g. for blisters in a carton; then carton is marketable pack}.Track & Trace to be implemented at carton level (Marketable pack) which is internationally a saleable pack. This can be implemented from July 2016.
3. Implementation of Track & Trace can be done at tertiary level from December 2012 which gives the manufacturer’s origin and identification.
4. Countries which have implemented or recommended to implement Track and Trace (which differ from our standards e.g. sNDC for US, CIP for France etc), country specific Track & Trace should be adopted as per the requirements of the importing countries.
5. Countries which either don't have existing Track and Trace requirement or have requirements matching to our standards should be considered for INDIAN Track and Trace guidelines, before implementation these countries should give acceptance to Indian track & trace guidelines.
6. Traditional medicines may be exempted from the requirements. Majority of the Ayurvedic formulations are exported as food/food supplements and personal care products. The counterfeit/misbranded/spurious drugs are not an occurrence in traditional medicines. Keeping traditional medicine which are covered under the purview of Drugs & Cosmetics Act to sophisticated tracking technology is totally unnecessary
7. In no case Indian Drug Industries are in a position to implement serial number correlation of Primary and Secondary Packaging i.e., mother-child co-relation. As majority of our Units are manual based packaging lines whereas to implement serialization, one requires to have fully automatic & computerized packaging lines. Hence serialization be exempted from the requirements.
Timelines are proposed considering high level of investment associated with line and plant layout modification, complexity associated with modified line /new equipment qualification, validation, training period etc
G. Assistance:
1) Appropriate awareness/technical assistance may be provided to SME sector by conducting workshops
2) Financial assistance to SME sector may be provided
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