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One might think that under DSCSA, dispensers are only required to focus on the literal buying and selling of drug product when it comes to figuring out whether or not T3 compliance documentation needs to be exchanged during a transaction. However, unless you fit the exemption criteria, a “transaction” simply means a change of ownership – money doesn’t necessarily have to have changed hands.
For example, there are exemptions for specific patient needs, and T3 documentation is also unnecessary if you are moving product from, say, a distribution center to a hospital that is owned by the same umbrella company.
The law is tricky, and exemptions may count in some transactions and not others. This makes it difficult to determine if you need to follow the provisions of DSCSA as well as whether or not you need to inform any trading partners who will receive your product, as their agreement is required before any exemptions can become “official”.
So what transactions exactly are considered exempt? Here’s a rundown of the transactions manufacturers might be involved in that don’t require the exchange of Transaction Statements, History, and Information documentation:
- Intracompany distribution of any product between members of an affiliate or within a manufacturer
- The distribution of product samples by a manufacturer or a licensed wholesale distributor
- The distribution of over-the-counter (OTC) drugs. Even if drug product in certain States must be sold behind the pharmacy counter to patients with physician-issued prescriptions and not on shelves, it will not be considered a prescription drug under DSCSA ruling because the law operates on a Federal, not State level. It regulates drugs nationally, creating an exemption
- The distribution of “medical convenience kits”, a collection of finished medical devices, which may include a drug product or biological product, assembled in kit form strictly for the convenience of the purchaser or user, if:
- the kit is assembled in an establishment that is registered by the FDA as a device manufacturer
- the kit does not contain any controlled substance
- the kit manufacturer purchased the drug or biologic product contained in the kit directly from the pharmaceutical manufacturer or from a wholesale distributor that purchased it directly from the pharmaceutical manufacturer, and the primary container label of the drug or biologic product contained in the kit is not altered and the drug or biologic product contained in the kit is:
- An intravenous solution intended for the replenishment of fluids and electrolytes
- A product intended to maintain the equilibrium of water and minerals in the body
- A product intended for irrigation or reconstitution
- An anesthetic
- An anticoagulant
- A vasopressor
- A sympathomimetic
As soon as you determine whether your product is exempt from T3 documentation exchange practices, it’s important to notify those trading partners – you don’t want any wholesale distributors, 3PLs or repackagers demanding transaction documentation when they receive your product and you not being able to provide it. It could not only mean that shipments are refused because your trading partners want to comply with the law, but it could get you into hot water with the FDA.
Another quick exemption to note is if your product is a device (even an “Rx Only” device as mandated by the FDA) then you also don’t have to be concerned with DSCSA documentation requirements.
When evaluating exemptions and considering the need for compliance documentation, it can also be a good time to adjust your business processes for the future. Given that DSCSA focuses so heavily on tracking the history and progress of all product that goes through the supply chain, and remembering that there are more requirements when it comes to inspections and reports about that product, there is definitely value in creating an internal record of all exempt transactions that your company makes just in case. Since it’s likely that you will have had to update your system for receiving and storing data with the new regulations, it makes sense to have an additional system to handle the exemptions too, on the off chance an inspection includes checking on your non-DSCSA transactions.
Loaning, bartering and donating product, though, are considered DSCSA transactions.
Naturally, when you resell product as a dispenser, you need to provide compliance documentation. You’re also going to have to have a compliance system that understands the additions that have to be made to T3 documentation when the product leaves your hands. For example, even if you receive product from a wholesaler that doesn’t have a lot number and transaction date, you’re still going to be required to provide that information with your T3 on the outgoing product. It pays, if you anticipate that you’re going to be reselling product, to make sure that you have the lot numbers of any product upon receipt to avoid hassles at the other end.
Excess product isn’t exempt from DSCSA requirements either. Dispensers know that selling product that won’t be used before the end of its shelf life – likely at a discounted price – is just inventory management; why let it expire and become waste when another dispenser could use it? However, no matter the reasoning or exact costs incurred, T3 documentation still has to be sent when the product is exchanged.
Loaning or bartering – which happens often in hospital or clinic settings and generally involves trading one product for another between dispensers – needs to be DSCSA compliant just like a standard sale would be, otherwise you cannot legally accept and dispense that product. Regardless of the agreement between yourself and your trading partner, there is a definite change of ownership that occurs with bartering, so obviously T3 documentation is in play.
Lastly, under certain circumstances, you may be involved with donating product to a business, or you may receive donated product from a wholesale yourself. In either case – unless there are any exemptions in place such as sending out product samples, or if you are donating the product to a non-profit organization affiliated with your company (both listed in the exemptions above) – T3 documentation must go with the product.
It’s also important to fully vet your current trading partners you might loan, barter, or get product donated from, to make sure you’re all on the same page when it comes to your compliance documentation, and also to make sure that they aren’t going to put you at risk by not understanding the regulations or compliance requirements.
Overall, cash changing hands is not the be-all and end-all of compliance when it comes to the new DSCSA set up. If you have exchanged product via bartering, donation, or loan, then it’s likely – barring a few exemptions – that you’ll have to provide and keep a record of T3 information. The DSCSA was created with the intention of tracking drug product down to the individual bottle, right up until it reaches a patient, so any movement of it before that level should be recorded for those purposes.