On April 30, 2020, the U.S. Food and Drug Administration (“FDA”) published guidance clarifying the nature and scope of exemptions and exclusions to certain requirements under the Drug Supply Chain Security Act (“DSCSA”) triggered by the COVID-19 public health emergency. By waiving certain requirements under the DSCSA for the duration of the COVID-19 public health emergency, the FDA seeks to ensure that prescription drug products are effectively distributed throughout the supply chain to combat COVID-19.
Enacted in 2013, the DSCSA amended the Federal Food, Drug and Cosmetic Act (“FDCA”) and established product tracing, product identification, authorized trading partner and verification requirements for pharmaceutical manufacturers, wholesale distributors, repackagers, dispensers and third party logistics providers in order to facilitate the tracing of certain drug products through the pharmaceutical distribution supply chain. The DSCSA seeks to build an interoperable electronic system that identifies and traces prescription drug products at the individual unit level through all stages of the pharmaceutical supply distribution chain by November 2023.
Notably, the DSCSA automatically excludes from certain of its requirements specific activities pursuant to the declaration of a public health emergency by the Secretary of the U.S. Department of Health and Human Services (“HHS”). Specifically, the distribution of a pharmaceutical product for emergency medical reasons, including a public health emergency declaration, is exempted from the definition of a “transaction” and excluded from the definition of “wholesale distribution” under the DSCSA.
The newly issued guidance clarifies that the statutory exemption and exclusion apply to the distribution of covered COVID-19 products, including prescription drug products issued an emergency use authorization (“EUA”) by the FDA, or products approved by the FDA to diagnose, cure, mitigate, treat or prevent COVID-19. The FDA states that the exemption and exclusion will also apply to other affected products directly impacted by the COVID-19 public health emergency, including but not limited to those used to treat symptoms of COVID-19 or to provide supportive care to patients with severe cases of COVID-19.
As such, trading partners are not required to comply with certain product tracing and product identification requirements triggered by a “transaction” pursuant to the distribution of covered COVID-19 products. However, the FDA emphasizes that trading partners distributing products for purposes unrelated to the COVID-19 public health emergency are still required to comply with all applicable DSCSA requirements in connection with the distribution of the product. Moreover, the exemption does not apply to other DSCSA requirements that are not triggered by a “transaction” including having a valid registration with the FDA; licensure for authorized trading partners; or verification processes in connection with the quarantine and investigation of suspect product, and the quarantine and disposition of illegitimate product.
The guidance further states that wholesale distributors are not required to comply with the licensure provisions, reporting requirements or wholesale distributor requirements under the DSCSA for activities related to the distribution of covered COVID-19 products. However, an entity engaged in activities meeting the definition of “wholesale distribution” but unrelated to the COVID-19 public health emergency is still required to comply with applicable DSCSA requirements. The FDA also emphasizes that states may still require licensure of wholesale distributors pursuant to applicable state law.
The guidance notes that while the DSCSA’s requirement to trade only with authorized trading partners remains in effect for the duration of the COVID-19 public health emergency, the FDA does not intend to take enforcement action against trading partners engaging in COVID-19-related product distribution involving entities that would otherwise meet the definition of “wholesale distributor” under the DSCSA save for the exclusion described herein, or trading partners that are not authorized solely due to circumstances directly related to the COVID-19 public health emergency, and that are otherwise working with, or authorized by state authorities to operate during the COVID-19 pandemic.
Please note that the exemption and exclusion from certain DSCSA requirements outlined in the guidance apply only for the duration of the COVID-19 public health emergency. For further information regarding how the public health emergency exemption and exclusion may affect your company’s operations, please reach out to your Cooley attorney.