Axway, Cyclone and McKesson join to fight fake drugs

By Kirsty Barnes

- Last updated on GMT

Related tags Supply chain Pharmaceutical industry Pharmacology Authentication

French-owned software firms Axway and Cyclone Commerce have joined
forces with US drug distribution firm McKesson to develop new and
cost-effective IT to support the pharma industry in its venture to
introduce item-level tracking to fight fake drugs.

The companies have previously worked together to develop the Cyclone ePedigree - an electronic tracking system used by manufacturers, distributors and retailers to link inventory movements with business-to-business transactions such as purchase orders and invoices throughout the commercial supply chain.

However, the new the partnership aims to take regulatory compliance and inventory management to meet the next level in order meet the industry's needs for a longer-term strategy around serialisation, product authentication and track and trace to further secure the drug supply chain and help wipe out counterfeiting.

"To date, pharmaceutical manufacturers, distributors and retailers are only focusing on solutions for individual safety-based supply chain initiatives, such as ePedigree,"​ said Daryl Eicher, vice president of healthcare and industry solutions at Cyclone Commerce.

"Our technology aims to support the capture and transfer of data when companies such as McKesson eventually begin to use radio-frequency identification (RFID) tags to serialise drug products across the whole supply chain down to the item level,"​ Piers Lingle, chief technology officer for new applications at Axway told

Counterfeit drugs is one of the most critical issues facing the pharma industry today, having evolved into a burgeoning global industry which is estimated to grow 13 per cent a year to reach $75bn (€58.5bn) in 2010, a 92 per cent increase from 2005 - compared to just 7.5 per cent estimated annual growth for global pharmaceutical commerce.

Regulators currently require pharmaceutical supply chain constituents to provide drug pedigrees, or custodial histories, which trace each drug's chain of ownership from the pharmacy back to the manufacturer, however, the pharma supply chain presently relies on an imperfect, mostly manual process of tracking drug pedigrees.

As a result, a number of technology firms have scrambled to develop next-generation 'track and trace' and product authentication technologies, primarily involving RFID, although such technologies are still in their infancy and have yet to provide the industry with a suitable solution.

For example, RFID was a hot topic at the recent annual general meeting of the European Association of Pharmaceutical Wholesalers (GIRP), held in Budapest.

GIRP is still reluctant to embrace RFID technology, claiming that a uniformed track and trace system for Europe still lacks the affordable, well proofed and effective technology which would allow for the implementation of a seamless track and trace procedure throughout the supply chain without resulting either in sky rocketing costs or unacceptable delays for pharmacies and patients.

Meanwhile, technology firms continue to work behind the scenes to eradicate such problems.

"Our expanded relationship with Axway is designed to address the industry's need to safeguard the supply chain as well as driving out costs,"​ said Kim Loughead, director of emerging technologies at McKesson.

"As regulatory requirements evolve, supply chain players will benefit from operational improvements, such as increased service levels, improved in-stock rates and shorter order-to-cash cycles."

In 2004 the US Food and Drug Administration (FDA) said it hoped that RFID would be used widely as part of an electronic pedigree system by 2007, however, it has since come to realise that the pharma industry cannot be regulated into accepting RFID, at least not yet, and recently stopped short of demanding its implementation in new measures it unveiled to combat counterfeit drugs.

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