The Limitations of Track and Trace Technologies in Fighting Counterfeit Drugs

Alan Clock, Senior Vice President, XStream Systems, Inc.

To date, nearly all of the solutions for the global epidemic of counterfeit and adulterated drugs has emphasized technologies that are known as Track and Trace methods (e.g. barcodes, holograms, RFID, pedigree, taggants, and serialization).

Track and Trace methods were developed and are based on technology designed for inventory control/security and are common within most sophisticated supply chains. These solutions are very effective in tracking product, especially in direct or short supply chains, where the additional cost can be justified in their inventory control capabilities because the members of the supply chain use common systems and tools for tracking, distribution and sales.

That being said, Track and Trace solutions have their limitations:

• They generally require some sort of an addition to the outside of the box or package and a common technology to be read and documented.


• These processes and technologies add additional cost to the product and are difficult to maintain across large global supply chains.


• Because of its external placement of these methods on the material’s packaging, the Track and Trace item may be easily replicated, and, at the very least, does not verify that the material inside the package is safe and efficacious.

The costs for a global supply chain to implement Track and Trace solutions are staggering. According to an EU Commission Consultant, the initial cost for deploying a Mass Serialization pharmaceutical program in the European Union would include:

• An industry wide one-time cost of €11.5 billion to set up the proper systems within all members of the pharmaceutical supply chain in Europe.


• Annual “running costs” for serialization with European pharmaceutical companies to be €185.5 million for non-OTC companies.


• EU pharmacies would incur costs of installing the right IT and reading devices to support serialization estimated to be approximately €157 million, with no estimates on the annual costs of running the system.

Although Track and Trace solutions are useful to a point, they are significantly limited in their effectiveness. When additional costs to all members of the supply chain are added, they include significant changes to the manufacturing, packaging and distribution processes. Additionally, as we have seen lately, many of the incidents of substandard, fraudulent and counterfeit product all had perfect pedigrees and their packaging was either original or perfect facsimiles.

The best way to effectively purge the pharmaceutical supply chain of poor quality, fraudulent or counterfeit medications is to look inside the box to screen, verify and authenticate the product inside the package.

Ideally, a quality control and anti-counterfeit solution for the pharmaceutical supply chain would not require any alterations to the product or the package. The remedy would allow packaged drugs to remain intact and will be readily deployable. The placement of the testing unit could be at strategic points within the supply chain or deployed throughout without onerous costs or prohibitive timelines.
This new cure would provide a level of confidence that public safety is ensured by verifying the material inside the package.

We at XStream Systems are very excited about our technology which meets the needs as an effective quality control and anti-counterfeit technology solution for the pharmaceutical supply chain. The XT250 system allows the members of the pharmaceutical supply chain to screen and verify the contents of product inside its unit of sale container without opening it, changing its label, or destroying or degrading the material inside.

To learn more about XStream’s XT250 and its revolutionary technology, visit: http://www.xstreamsystems.net/.