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RFID hits roadblocks in war vs. fake drugs

Posted: 16 Nov 2007 ?? ?Print Version ?Bookmark and Share

Keywords:RFID? drug counterfeiting? electronic product code?

The electronics industry has been counting on RFID's adoption as the antidote to drug counterfeiting. But legal wrangling and federal foot-dragging, abetted by the powerful pharmaceutical lobby, are raising concerns that the technology's adoption for tracking drugs through the supply chain may no longer be a given.

That possibility looms despite the damage inflicted by counterfeit drugs, whose distribution has reached epidemic proportions. Fake AIDS and malaria drugs kill thousands of people annually across the globe.

"The issue is not just about counterfeit drugs; it's also about 'up-labeling' diluted drugs and selling them in the gray market," said John Jordan, president of worldwide field operations at Tagsys, a manufacturer of RFID systems and tags for end-to-end item tracking.

The problem shouldn't be that hard to fix. A unique number attached to each pill bottle could track a drug throughout the supply chain.

Toward that end, the U.S. Food and Drug Administration (FDA) has asked the pharmaceutical industry to develop "pedigree" mechanisms to identify "the chain of custody" as a drug travels from plant to wholesaler to pharmacy.

Creating a paper trail is one approach, but a potentially more effective mechanism would be an "electronic pedigree" (e-pedigree) system based on 2D bar codes or RFID tags. The FDA has issued no mandates for an electronic system, but it has recommended that stakeholders move to implement RFID.

Boom or bust?
The application could prove a windfall for RFID technology suppliers. NXP Semiconductors was an early believer in the e-pedigree market's potential and has become the de facto RFID chip supplier to the pharmaceutical market, helping steer the course of an interim industry standard by participating in high-visibility trials.

Atmel Corp. is also bullish on the application, with the introduction of the CryptoRF product family. By adding more robust security measures such as mutual authentication capability to its RFID chips, Atmel is hoping for a foothold in the e-pedigree market.

Texas Instruments Inc. (TI) is active in the sector as well. Besides providing UHF chips for inlay, label and antenna designs, TI has partnered with Certicom to enable authentication and encryption on TI RFID tags via Certicom's elliptic-curve cryptography.

But it's "way too early to pop the champagne," warned Louis Bianchin, senior analyst at market watcher Venture Development Corp., and he's not alone in his belief that the enthusiasm for RFID-enabled e-pedigrees should be contained for now.

Indeed, some pharmaceutical industry observers now say the emergence of an RFID anti-counterfeit market is a myth. Some warn that special interests seeking to erect political obstructions to the e-pedigree could blame the inertia on engineering problems.

E-pedigree is "stuck in the mud" of legal wrestling and federal waffling, said Bianchin. Last December, a group of secondary wholesalers, led by RxUSA Inc., won a temporary injunction preventing the FDA from fully imposing its pedigree rules. The FDA appealed, but the Second Circuit of the U.S. Court of Appeals has yet to schedule a hearing.

Legislators, meanwhile, have been slow to move on the issue. The pedigree requirement was established in 1987 as part of the Prescription Drug Marketing Act but was stayed repeatedly, supposedly pending the development of practical solutions.

The pharmaceutical lobby hasn't seemed anxious to break the stalemate. Describing the RxUSA suit against the FDA as a "monkey wrench" thrown into the nascent market, Bianchin said, "Without the court's decision, and without federal legislation, the pharmaceutical industry has little reason" to move forward with e-pedigree programs.

Delayed for months
Last December, VDC wrote in its yearend overview that it expected "significant growth from the pharmaceutical, consumer product goods and health care markets, especially when item-level tracking applications become more pervasive in 2008 and 2009." Today, Bianchin is far less sanguine. The RFID market for pharmaceutical applications was "flat" in 2006, he said, and "2007 is identical. Not much is expected to come out by mid-2008. This is a market that's 24 months behind projections."

RFID tags in e-pedigree apps will boom 'if item-level tracking takes off in 2009 and 2010,' according to VDC.

RFID promoters are pinning their hopes on a requirement in the U.S. state of California for drug companies to create an electronic certificate of authenticity for every drug distributed in the state by Jan. 1, 2009. Other states are considering similar legislation but may not mandate an electronic pedigree. There is a fear that the industry may end up with a patchwork of state laws that lays no common path to an RFID-based program.

If e-pedigrees are adopted, the pharmaceutical industry may opt for a bar code system instead of RFID tags, noted Sanjay Sarma, associate professor of mechanical engineering at the Massachusetts Institute of Technology and co-founder and former research chairman of MIT's Auto-ID Center.

Although electronic systems other than RFID would be "more expensive in the long run," Sarma said he fears "the industry might go down that path."

Even if RFID is adopted for the drug-tracking application, the hoped-for market could fail to pan out if pharmaceutical companies insist on a 100-percent read rate for the tags or if the technology proves too costly. RFID could take the fall for the failure of pharmaceutical e-pedigrees, some observers warned, if drug providers see a way to delay the infrastructure buildout by faulting the technology.

"There is a fundamental system-level design question that companies will grapple with," said Sarma. "While the RFID technology is there today, read rates will never be 100 percent. That's a truth that comes from physics. The problem is that implementers often mistakenly demand that each portal deliver 100 percent read rates, and they spend more and more on readers and antennas to get to that mythical number. At some point, the cost becomes prohibitive."

Robin Koh, chief strategy officer at SupplyScape, a service provider of supply chain management for the pharmaceutical industry, believes 2008 will be the pivotal year for the e-pedigree market. But he cautioned that the eventual e-pedigree implementation "might change from the current shape and form."

There's "a disjoint between regulatory needs and commercial needs," Koh said. On one hand, the regulatory bodies are pushing e-pedigree to make drugs safer. On the other hand, pharmaceutical executives appear more intrigued by RFID's speed as an inventory control tool than by its security aspects.

Koh said he sees an opportunity for technology suppliers to educate the pharmaceutical industry on the technology's potential role in "product security."

Secure tags, safe drugs
That's where Atmel sees an opening. Eustace Asanghanwa, field applications manager for Atmel's CryptoRF and CryptoMemory products, noted that the CryptoRF products provide mutual authentication capability, 64bit unreadable encryption and authentication keys, unique keys for each device, unique keys for each session, and the ability to set permissions (no-access, read-only, read/write) for specific zones. The family also provides authentication attempt counters, which destroy the chip after four to eight failed tries, and a dual authentication mode.

"CryptoRF provides mutual authentication. It is virtually impossible to copy or read the secret information inside," Asanghanwa said. "Anything less robust is too easy to counterfeit. Passwords, even when encrypted, can often be read directly from the tag and can be captured during a transition."

Not everyone agrees. Jordan, whose company has worked with NXP in trials, said, "Nobody in the industry has asked for such a high level of security in RFID chips."

NXP offers the Icode UID-OTP line of RFID chips for use as pharmaceutical supply chain tags. The NXP-programmed Unique Identifier guarantees the RFID tag is unique, and the one-time-programmable user memory locks the user data after programming. Peter Schmallegger, segment marketing manager for pharma market sector RFID at NXP, said the product also supports a destroy command, allowing the RFID tag to be permanently disabled when the customer picks up a prescription from the pharmacy, thus ensuring privacy.

"The current systems fulfill the industry's security requirements," Schmallegger pointed out, adding that "further enhancements of security are to be discussed within a dedicated working group at EPCglobal," which drives standards for electronic product code applications.

Asanghanwa said the "specification soon to be released by EPCglobal may not have a complete security definition, but I'd expect it to have extensions where tag manufacturers can incorporate well-tested security infrastructure."

"The most suitable RFID product is one that is at least one step ahead of the counterfeiters," said Daniel Engels, associate EE professor at the University of Texas at Arlington. "Today, that's a simple RFID tag. Tomorrow, that will be an RFID tag with some additional anti-counterfeiting feature built into it." Possibilities, said Koh, include combining RFID with a hologram label or watermark.

- Junko Yoshida
EE Times




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