The Drug Supply Chain Security Act (DSCSA), also known as the “Track-and-Trace Law” was designed to identify and trace prescription drugs at the package level as they move throughout the drug supply chain. The overarching goal, according to the FDA, is to (1) prevent harmful drugs from entering the supply chain, (2) recognize any harmful drugs if they do enter the supply chain, and (3) provide a way for the rapid removal of any harmful drugs that have entered the supply chain. To accomplish this, trading partners cannot accept prescription products unless the products have all necessary and compliant identifiers. These identifiers include a 2D barcode, NDC, serial number, lot number, and expiration date on the label.

The DSCSA will take effect on November 27, 2024. Initially signed into law in 2013 and set to take effect on November 27, 2023, exemptions and stabilization periods have delayed the implementation timeline. The law will finally take effect before the end of the year. Despite the initial one-year delay that was meant to ensure all parties in the drug supply chain were ready to fully comply with the new standards, exemptions and waivers have continued to be issued. In July of this year, the FDA granted an exemption, which provided a compliance delay for small business dispensers.

The July exemption for small business dispensers will last until November 27, 2026. This exemption is meant to provide more time for small businesses to stabilize their operations while complying with the new DSCSA Act. Under this exemption, a corporate entity is considered a small business dispenser if there are a total of twenty-five or fewer full-time employees that are either licensed pharmacists or qualified pharmacy technicians. This definition was specifically made with small pharmacies in mind, with the thinking being that these entities would need more time to comply with the requirements set by the DSCSA.

Recently, trading partners have been reporting to the FDA that the data exchange at the transfer of product ownership has not been seamless and always correct or accurate. What does this mean for trading partners under the DSCSA? If the data is not accurate when receiving the prescription products, then technically, under the DSCSA, dispensers cannot accept ownership of the product or the product must be placed under quarantine. This could lead to disruptions in the supply chain, negatively impacting patients who cannot get their prescriptions filled.

The FDA heard this feedback and issued a new exemption with different timelines for different trading partners in the pharmaceutical supply chain. The exemptions have been put in place to avoid critical interruptions in the supply chain that may impact how and when patients receive their medications. Eligible trading partners for this round of exemptions are “those who have initiated their systems and processes by successfully completing data connections with their immediate trading partners and those who have initiated processes including documentation of efforts to establish data connections but were not able to fully complete them with all immediate trading partners.”

• Manufacturers and Repackagers have from November 27, 2024 to May 27, 2025 to fully comply with the DSCSA
• Wholesale distributors have from November 27, 2024 to August 27, 2025 to fully comply with the DSCSA
• Dispensers with twenty-six or more full-time employees have from November 27, 2024 to November 27, 2025 to fully comply with the DSCSA

These varied timelines seek to give trading partners time to fully address any challenges that may still exist surrounding the data exchange required when transferring prescription products.

The FDA has been clear that if a trading partner does not qualify for the exemption listed above, the exemption for small business dispensers, or any other previously established DSCSA exemption, then all requirements listed under the DSCSA Act should be met beginning November 27, 2024. This exemption, along with other exemptions that have been issued, are not intended to be viewed as justification for delaying the implementation of the DSCSA. The exemption is an attempt to “maintain public health and help ensure continued patient access to prescription drugs in the United States.” The FDA also urges all trading partners to continue to implement all measures that would satisfy the enhanced drug distribution security requirements in a timely manner.

Those needing to rely on the new exemptions do not need to submit a notification or request a waiver from the FDA to do so. They are, however, expected to communicate their reliance on these exemptions to any trading partners and communicate that the exemption extends to any transactions between those two trading partners. Do you think the FDA will further postpone DSCSA enforcement? PHSL will continue to monitor!