Facilitating Implementation and Customer Service with Offline Serialization

Even though the FDA has extended the deadline for compliance with unit serialization requirements, UPM Pharmaceuticals serialized its first commercial product in May 2017, well ahead of time. The use of an offline serialization system facilitated implementation and provides numerous benefits to our company and our clients. 

Rising Incidence of Fraudulent Medicines

Drug counterfeiting is a global and growing problem. In 2010, the World Health Organization (WHO) estimated that the incidence of counterfeit drugs is less than 1% in developed countries and much higher in developing countries.1 As of November 2017, the WHO estimate that 1 in 10 medical products in low- and middle-income countries is substandard or falsified.2 Its Global Surveillance and Monitoring System, founded in 2013, had issued 20 global medical product alerts and numerous regional warnings and provided technical support in over 100 cases.

In the US, between 2010 and May 2016, close to 1,400 adverse reactions related to counterfeit drugs were reported to FDA.3 This data does not include incidences of counterfeit or compromised medications that do not lead to any adverse reactions or have no effect. As a result, the true extent of the problem is unknown.

Serialization Expected to Help

Governments around the world have responded to the increasing presence of fake medicines in the drug supply chain by passing regulations requiring that pharmaceutical manufacturers implement systems that allow for the track-and-trace of drug products throughout the supply chain. Compliance is already required in some countries, while deadlines are fast approaching in others. The detailed expectations vary from country to country, and even over time within individual countries. They are also constantly evolving.

In the US, serialization requirements were established in the Drug Quality and Security Act (DQSA), which became law in November 2013. The law applies to manufacturers, repackagers, wholesale distributors, dispensers and third-party logistics providers. Title II of the DQSA outlines the requirements for supply chain members with respect to the implementation of track-and-trace systems for prescription drugs in three phases over 10 years. The sharing of lot-level information was completed in 2015. The serialization of all product units and the sharing of this data were to be completed by November 2017; and the sharing of aggregate data linked to unit data to establish chain-of-ownership throughout the drug supply chain from the manufacturer to the patient was initially set for 2023.

Track-and-Trace More Complex than Anticipated

Most large pharmaceutical companies and a select few CDMOs have taken an aggressive approach to implementing comprehensive internal serialization solutions.4 Many companies, particularly smaller and medium-sized firms with limited resources, have adopted a “just-in-time” approach, implementing only those elements of the system needed to meet specific deadlines in different countries.5 There are still a large number of smaller companies that are just beginning to initiate internal track-and-trace programs. Others have elected to forego any internal efforts, preferring to rely on outsourcing partners. A few companies also remain that have not taken any action with regard to serialization.

Implementing serialization solutions has, in fact, proven to be more complex and challenging than many pharmaceutical producers — both sponsor firms and contract development and manufacturing organizations (CDMOs) — expected. Companies must establish bi-directional data exchange connections with a wide range of suppliers and other partners (including clients and distributors for CDMOs), grapple with a dramatic increase in the quantity of data that must be generated and managed, stay up-to-date with evolving regulations in numerous countries, and implement their solutions without any disruption in the supply of their drug products.5 The FDA responded by extending the deadline for compliance with the establishment of unit serialization by one full year, to November 2018.

Additional Considerations for Contract Manufacturers

For any serialization system, definitions and formats for serial numbers must be determined. Sufficient space must be available on the product packaging to apply the serial number and other relevant data. A management system must be in place to allocate the serial numbers and link them to larger groups of unit packages, such as boxes and pallets (parent/child relationships) and to orders, shipments, etc. A system for handling other issues —­ repackaging, rework, returns, etc. — is also necessary.

Implementing an effective serialization solution is, therefore, challenging for any type of drug manufacturer. In addition to being quite costly, serialization impacts many different company operations and thus requires input from representatives of many different groups. Labels must be redesigned, and large quantities of new data must be properly managed and shared with appropriate partners in the supply chain. The new system must be implemented without negatively effecting production operations. Serialization cannot result in reduced efficiencies.

Contract manufacturers have the added challenge of needing to serialize different drug substances and/or drug products for many different clients, each with its own understanding of serialization and related set of expectations. In addition, contract manufacturers do not control the labels that they must use, but have to work within the capabilities of their serialization equipment. It is essential for CDMOs to make sure their customers understand those printing limits to ensure that mandated information is appropriately included on product labels.

In the US, between 2010 and May 2016, close to 1,400 adverse reactions related to counterfeit drugs were reported to FDA.


Flexible Strategy at UPM

UPM has always had strict procedures and specifications in place for labeling of drug products. We work closely with our clients and their product management teams to ensure that all labeling is correct and products are branded and otherwise labeled as they are supposed to be. We also have an extensive vendor approval process to ensure there are no mix-ups with labels or diversion of artwork to people trying to produce counterfeit versions.

When embarking upon our serialization project, we recognized the need to maintain this high level of security while implementing a flexible track-and-trace solution that allows for tailored customer service combined with robust and reliable performance. We wanted to be able to serialize bottles, cartons and cases, without disruption of production while maximizing the capacity on each of our packaging lines.

Our solution was to adopt an offline serialization strategy. At UPM, our serialization workstations are not associated with a packaging line. This approach provides the greatest amount of flexibility to serve our three packaging lines. Rather than having to set up the packaging equipment for printing, verifying and applying labels that will be serialized during packaging, we preprint the serialized labels/cartons in advance, electronically grading and verifying the information offline, and then apply the labels or fill the cartons during production.

Serialization offline affords us the flexibility to rapidly respond to customer requests for trial serialization runs. Often smaller customers aren’t confident their labels will have sufficient space. Rather than needing to wait for time to be available on a packaging line, we can conduct trial runs on our offline workstation to determine if a label is ready. Offline serialization also provides the ability to troubleshoot problems without tying up a packaging line. As a result, we are able to maintain production efficiencies and maximize capacities.

In addition, while UPM selected TraceLink — the world’s largest cloud-based provider of serial codes — as our serialization software partner, TraceLink is capable of working with whichever serialization codes are used by our clients with an interface built between other serial code providers and TraceLink. The transmission of data with TraceLink has proceeded without any issues. Since the link was established, we have consistently received codes and sent them back to TraceLink for commissioning. All lot statuses can be verified on TraceLink’s website once code transmission is complete.

Cross-Functional Effort

A core cross-functional team was involved in establishing UPM’s serialization strategy and bringing the project to fruition. Representatives from our information technology, technical service, manufacturing and quality groups formed this core team. The IT department worked closely with the equipment manufacturer and TraceLink to understand all of the system specifications as well as hardware and software requirements needed to manage and maintain our serialization operation.

Label control is an essential component of pharmaceutical packaging. The addition of a serialization component added another layer of complexity to label control. It was thus determined that a labeling department would be created to control all serialization activities and manage new clients. This department is within the quality assurance group and is responsible for generation of serial codes, generating and issuing serialized labeling, and reconciling completed batches once production is finished.

The first commercial batches serialized by UPM were produced in May 2017 – well ahead of the original November 2017 deadline for unit serialization.

Staying Ahead of Schedule

The goal at UPM was to be six months ahead of the regulated implementation date for serialization, allowing for enough time to ensure a seamless serialization process. UPM management was committed to making sure the capital was available to acquire and install the necessary system components ahead of the curve. We also benefited from partnership with a client that used UPM as a beta site before bringing a similar serialization system into its own facility.

The first commercial batches serialized by UPM were produced in May 2017 — well ahead of the original November 2017 deadline for unit serialization. Despite the one-year extensions granted by FDA, we have remained committed to our timeline for serialization of all batches. We currently meet the requirements that will go into force in November 2018. In addition, we have procedures and processes in place for on-boarding new clients and new products from existing clients, 75% of which we are currently serializing.


Serialization, when used in conjunction with tamper-resistant packaging and other fraud-prevention methods, is expected to provide greatly increased security for the pharmaceutical supply chain. The transparency provided by the ability to trace the movement of a product unit throughout the supply chain, from the manufacturer to the distributor — and on to the patient, should provide a mechanism for the identification of both authentic and questionable medicines.

We are also building a base of understanding and preparing to respond to the unexpected when it happens. For instance, we have established complaint procedures and validated communications between UPM and our clients. In addition, we are evaluating current solution providers as we look to the next phase of serialization — aggregation. Labeling, including printing, application, verification and aggregation will be required to be done online. We are already preparing for this next level by considering the lessons learned during the first phase of serialization implementation at UPM.


  1. “Medicines: Counterfeit Medicines,” Fact sheet. World Health Organization, Jan. 2010. Web.
  2. “Substandard and Falsified Medical Products.” Fact Sheet. World Health Organization. Nov. 2017. Web.
  3. Joe Eaton. “Counterfeit Drugs are Flooding the Nation’s Pharmacies and Hospitals,” AARP Bulletin. May 2016. Web.
  4. Caroline Hroncich. “Serialization Challenges Facing Pharma Manufacturers.” PTSM: Pharmaceutical Technology Sourcing and Management. 12(5). 18 Apr. 2017. Web.
  5. Agnes Shanley. “Tracking Pharma’s Serialization Efforts,” PTSM: Pharmaceutical Technology Sourcing and Management. 11(5). 04 May. 2016. Web.
  6. Gary Lerner, Todd Applebaum, Jim Dougherty. “Serialization in a CMO Environment,” Contract Pharma, June 2012. Web.


Tyler Ewald

Mr. Ewald serves as UPM’s Associate Director of Manufacturing. He brings a broad knowledge of the pharmaceutical industry, having managed operations from intravenous to solid dose products. He served as the packaging department lead for UPM’s procedural development and implementation of serialization. Mr. Ewald holds a Bachelor of Science in pharmaceutical sciences from Campbell University and a Masters of Business Administration from East Carolina University