Pharma Serialization:

Managing the Transformation

By making the right investments in the right technology with the
right business partner, the pharmaceuticals ecosystem can alleviate
and hopefully eliminate the threat of counterfeit drugs to patient
safety and wellness.
Executive Summary
The global pharmaceuticals industry faces
problems of counterfeiting, theft, diversion and
false returns to manufacturers. The World Health
Organization (WHO) estimates counterfeit drugs
are approximately 1% of the supply in developed
countries and 30% to 40% in developing coun-
tries. Though the 1% gure seems small, it consists
of millions of prescriptions in the U.S. alone.
Pharmaceuticals companies and governments of
countries worldwide believe that counterfeiting
by organized crime can be reduced signicantly
by implementing product serialization. Serializa-
tion requires a comprehensive system to track
and trace the passage of prescription drugs
through the entire supply chain. Every product
should be identied by a unique serial number in
addition to the origin, shelf life and batch number.
This will allow the products lifecycle to be traced
from production, through distribution and nally
to dispensation to patients at the drugstore or
hospital.
Serialization needs careful assessment, diligent
planning and swift implementation. This white
paper offers pharmaceuticals companies critical
information on leveraging global best practices
when implementing serialization. It covers:

The need for serialization.

Key challenges for implementation.

An implementation maturity model.

Our approach to serialization.
Serialization regulations are in place today in
Turkey, India, China, Brazil, Argentina and South
Korea; regulations are pending in the U.S., Canada
and the EU. Each nation, however, follows its own
guidelines/legislation e.g., Californias e-pedigree
law, U.S. FDAs serialization guidelines, Turkeys
serialization guidelines, Chinas SFDA serialization
requirements, etc. to curb counterfeiting and
thus ensure patient safety. Despite differences
in the countries laws, each nations regulations
tend to be built around GS1 standards
1
and are
sufciently similar. This means pharmaceuticals
companies, generally, can develop one program
that meets all global requirements. Although the
GS1 format is the favored standard, International
Organization for Standardization (ISO), Internet
Engineering Task Force (IETF) and other compet-
ing standards also apply to serialization.

Cognizant 20-20 Insights

cognizant 20-20 insights | january 2013
cognizant 20-20 insights 2
Why Serialization?
Serialization is fast becoming a necessity for
the pharmaceuticals industry (see Figure 2) as a
result of the following factors:

A highly complex distribution network from
manufacturer to consumer in which products
change hands as many as 10 times.

The authentication of the product at various
levels in the supply chain becomes very difcult
without data sharing across the supply chain.

Current business processes are very labor-
intensive and, as a result, the price paid by the
consumer for pharmaceuticals products is high.

The high price of prescription drugs and the
relative ease of duplication and diversion make
them a prime target for counterfeiters.

Current and pending regulatory requirements
mandate that manufacturers deploy track and
trace tools for product movement as well as
utilize authentication tools to retain their com-
petitiveness.
Serialization could result in economic benets, as
well as improved brand protection and consumer
condence in their medications.
2
What Drives Serialization?
Serialization is not just about generating unique
serial numbers for any saleable units, but also
maintaning those identications to provide
visibility and full traceability within the supply
chain. It requires collaborative action from
partners throughout the supply chain for accurate
recording, tracking and managing of data as the
product moves from manufacturer to distributor
to the dispensing point.
Serialization: Implementation Challenges
Managing and administering serialization is a
complex process that leads to additional cost if
not managed properly. Key operational challenges
include:

Creation of unique serialization codes for
individual products during the production
process.
Hierarchy of Benets
Brand Protection
Patient Safety
Regulatory and
Legislative
Supply Chain Synergies
and Efficiencies
Anticounterfeiting
Supply Chain
Figure 1
Product Mix-up
The risk of the
wrong product
being put into
distribution.
Counterfeiting
Manufacturing of
inferior copies of a
genuine branded
product labeled with
the original brand
name.
Gray Marketing
Unauthorized
distribution of
branded
products.
Pharmaceuticals
Impact
Loss in revenue.
Loss in prot.
Loss in brand equity.
Potential lawsuits.
Figure 2
Factors Necessitating Product Serialization
cognizant 20-20 insights 3

High-speed printing and verication of the
codes generated.
>
Production rates up to 500 units per min-
ute, as well as dust- and vibration-prone
packaging lines makes printing and veri-
cation challenging.

Cross-site coordination for serial generation
for similar product lines.

Integration with enterprise systems.

Optimum utilization of existing technologies/
machineries.
The packaging line must be revalidated as
equipment is added to generate each bar code.
Each code must be linked to product data and
applied to packages to enable tracking throughout
the supply chain. And, last:

Change management: Employees must be
trained to handle the new equipment.
Moreover, serialization demands that voluminous
data repositories are shared at all nodes of the
pharmaceuticals supply chain. High data volumes,
accuracy, security and data reliability all add to
the challenges of implementing serialization.
Serialization: Our View
We see product serialization as one of the top
priority activities for pharmaceuticals and
medical devices companies, as mandated by
regulatory agencies.
The serialization system is expected to perform
the following higher-level workows:

Organizing and managing serial numbers for
the entire system.

Ensuring number uniqueness and randomness
via integrated algorithms.

Assigning the numbers to a batch.

Passing serial numbers on to the serialization
line system (SLS) for further processing.

Maximizing the use of serialization assets that
are required by most geographies.

Ensuring that all serialization systems use
common capabilities: product identica-
tion equipment (PIE), product identication
middleware management systems (PIMMS) and
electronic product code information systems
(EPCIS). All of these must be designed to
meet global standards and service all markets
(design once, use many).
Our serialization solution addresses the
challenges at the shop oor and plant levels, and
connects to the enterprise level. Our solution
deploys units of unique identication (serializa-
tion) and creates associated unit-level electronic
records that can be easily accessed via the Web or
smart phones in real time. Simple and ubiquitous
access to product IDs (or UIDs) and related data
provide a previously unavailable level of visibility
into the production, distribution and use of

Identify Use Apply
Solutions
Strategy
Share Manage
Ways of Working
2D Data Matrix
Few Operating Models from
a Single IT& Data Model
Pack Data 2D Scanner
Patient Pharmacy Wholesaler Re-Packer Distributor Factory
Serialize Pack
Parent>Child
Association
Data Flow
Material
Flow
Common Equipment
Solution
Common Global
Standards
GS1 Identication
Keys
GS1 ECC200
Data Matrix
Barcode
Marchesini
& SEA Vision
Information
System
GS1-Compliant
Application
GTIN:
12345678901234
Ser No.
123AFDG789TR
Exp: 220912
Batch: 103 F
Figure 3
Serialization Underpinnings
4 cognizant 20-20 insights
products or their components throughout the
supply chain (see Figure 4).
Our Methodology and Offerings
We advocate that pharmaceuticals companies
undertake an in-depth analysis of the current
scenario and consider multi-phase implementa-
tion of serialization (see Figure 5), which entails
the following steps:

Evaluating current systems and processes
for product serialization, by considering
multiple factors such as functionality, technical
elements, interfacing and cost.

Facilitating discussions on the future state to
be for serialization and gathering high-level
requirements.
Figure 4
Carton Labeling and Association Process Flow
EPCIS
Electronic Product
Code Information Systems
E
n
t
e
r
p
r
i
s
e

S
y
s
t
e
m
s
P
r
o
d
u
c
t

L
i
n
e
C
o
n
t
r
o
l
M
a
c
h
i
n
e
C
o
n
t
r
o
l
Product Identification
Middleware Management System
Batch E-codes
for Product
Text files per
Pack Level
Print and Apply
Carbon Code
Associate Cartons
with Batch
Cartoner Bundler Case Packer Palletizer
Associate Cartons
with Bundles
Associate Bundles
with Shipper
Associate Shippers
with Pallet
Upload XML Files
to Stock
E-code Stock
on System
Generation of Batch
E-codes for Product
External
Agencies
PIMMS
Manage Association
Files
Figure 5
Serialization Blueprinting: Approach and Deliverables
O
u
r

M
e
t
h
o
d
o
l
o
g
y

f
o
r

P
h
a
r
m
a
c
e
u
t
i
c
a
l
s

S
e
r
i
a
l
i
z
a
t
i
o
n
Phases
Information
Gathering
Process Mapping
and Gap
Requirement
Denition
Solution Blueprinting
and Implementation
Roadmap
A
c
t
i
v
i
t
i
e
s

Gather and review
existing documenta-
tion, work manuals.

Interaction with
stakeholders (various
business functions
and IT stakeholders
together) in an envi-
sioning workshop.

Identify weaknesses
of the current docu-
mentation.

Identify inputs
and outputs of the
processes.

Select processes and
packaging lines for
in-depth study.

Process and systems
walk-through.

Interview/focus group
meeting with key stake-
holders.

Identify current pain
points and challenges.

Capture process
handoffs between
people and systems.

Identify process and
technology opportuni-
ties for improvements.

Review the processes
with process
owners and look for
redundant activities,
unnecessary process
steps, role ambiguity,
bottlenecks, cycle
time, etc.

Detailed analysis
to uncover data
management func-
tionality for packing,
warehouse and distri-
bution operations.

Our SMEs develop a
high level of require-
ments for the future
to-be in discussions
with all stakeholders.

Present nal deliver-
able and sign-off.

In this phase, a
solution architecture
for serialization would
be developed taking
into consideration the
various dimensions
such as data
management require-
ments, packaging line
considerations, line
and product-specic
variations.

A global master
blueprint template for
product serialization
is developed.

Present nal deliver-
able and sign-offs.
K
e
y

O
u
t
p
u
t
s

Program overview.

Workshop themes.

Measures of success.

Process maps.

Gap analysis document.

High-level require-
ments.

Individual creation/
validation of as-is
processes.

High-level
requirements/
to-be state.

Interfacing
requirements.

High-level solution
architecture/blueprint
document.

Project implementa-
tion roadmap.

Providing a high-level solution architecture,
requirements documentation and roadmap for
implementation (see Figure 6).
Implementation Maturity Model
for Serialization
Figure 7 depicts a model that we believe will help
in identifying an organizations degree of maturity
for a successful serialization implementation.
Conclusion
Threats to the integrity of the drug supply are
likely to intensify in coming years. According to
Peter Pitts, director of the Center for Medicine
in the Public Interest, global drug counterfeiting
is growing at 12% to 16% a year, and, in 2010,
generated as much as $75 billion in worldwide
revenues. It is shocking to realize that in some
Figure 6
Our Standard Framework

TBD
SAP OER/SAP BI
1
2
3
4
5
We have customized consulting, POC and
implementation/post-implementation support offerings for
serialization, ePedigree, track and trace, product recall and
GS1 compliance requirements for pharma companies.
Functionality is not a key differentiator all vendors
comply with the same international standard.
All major pharmaceuticals companies are moving
to the same SAP modules for their business process.
GS1-Compliant
Application
GS1-Compliant
Application
External Third-party, e.g.,
Tracelink , rfExcel
PIMMS-PIE, EPCIS-PIMMS,
EPCIS-External (including pedigree)
SAP AIE/Other ERPs
Manage Manage
Serialization
Pedigree
System Interfaces
Mobile Operations
Reporting
SAP AIE 7.x
5 cognizant 20-20 insights
Figure 7
Ascending Serializations Learning Curve
Level 1 Level 2 Level 3 Level 4 Level 5
P
M
O

a
n
d


G
o
v
e
r
n
a
n
c
e
Projects are managed
at an individual level
and the synergies are
not exploited. Projects
are managed as a
discrete unit.
Projects are managed
at a unit level with
no centralized PMO.
Slightly consolidated,
no consideration for
variations.
A centrally managed
PMO with well-
dened processes
and solutions, from
blueprinting to
deployment across
locations.
Central PMO with
active management
for site-specic
variations and scope
variations with clear
communication
plan and change
management.
End-to-end PMO from
blueprinting to global
rollout with proactive
planning, detailed change
and risk management, best
practices and continuous
improvement included.
C
o
n

g
u
r
a
t
i
o
n

M
a
n
a
g
e
m
e
n
t
Basic solution
conguration set-up
that lacks exibility and
adaptation.
Conguration is
repeatable, but needs
detailed study and
design modication to
the code base.
Data and packaging
line congurations
are well-dened and
designed with elements
that can be assembled
and realigned to
quickly accommodate
changing demands.
Data management
and line-specic
congurations are
captured at the
planning stage and
global templates are
in place.
Adaptable, exible
congurable serialization
solution enabling support
of wide variety of packaging
line functions.
R
a
p
i
d

D
e
p
l
o
y
m
e
n
t
Solution deployment
is planned for only
the pilot line with no
replicable code base.
Solution can be
modied and installed
in similar packaging
lines, but not readily
repeatable and the
timelines are not
predictable.
Deployment plan is
well-dened with all
common site and
packaging-line-specic
serialization variations
with actionable
timelines.
Deployment plans
support multiple
serialization and
coding requirements
with manageable
timelines.
Global development
playbook is in place and
the solution is readily
installable, replicable and
easily upgradable across
packaging lines and
locations.
cognizant 20-20 insights 6
parts of the world, somewhere between 30%
and 50% of drugs to treat serious diseases are
actually counterfeit, said Food and Drug Admin-
istration commissioner Margaret Hamburg,
who added that the problem is growing every
day.
3
Meanwhile, Joe Ringwood, chief operating
ofcer of Systech International, noted: Phar-
maceutical counterfeiting is a global problem
that is growing rapidly.
4
As a result, serialization
has the potential to be a very efcient tool for
pharmaceuticals leaders in the ght against
counterfeiting.
Managing the transformation is a crucial and
essential part of the overall serialization imple-
mentation strategy. By choosing a reliable partner
and developing a diligent implementation plan,
manufacturers can realize even greater benets
such as total supply chain visibility and reduced
product recalls, over and above what is required
by regulatory compliance.
Making the right investments in the right
technology with the right business partner can
only help the pharmaceuticals ecosystem
manufacturers, wholesalers, distributors and
pharmacies alleviate and eventually eliminate
the threat of counterfeited drugs to patient safety
and wellness. Successful serialization will be a key
differentiator and a clear competitive advantage
for pharmaceuticals companies in the near term
and over the long haul as drug counterfeiting is
reduced to a distant memory.
Quick Take
We helped in implementing serialization for a
leading global pharmaceutical major.
Scenario

Client wanted to implement e-code serialization
which uses common capabilities (PIE, PIMMS,
EPCIS) and is designed to meet global standards
and service all markets.

A complete solution was required to address
data management and packaging functions.
Our Role

Ensuring client standards are met through
engaging appropriate architecture, EIS and
quality resources at the right time.

Engaging with other teams to deliver project
requirements.

Managing and monitoring the change
management plan.

Managing IT risks and issues.

Providing regular status reports to IT
management.
Benets Attained

Track-and-trace products deployed from the
point of packaging to the pharmacy.

Reduced the risk of counterfeit products being
dispensed.

Expired products now detected automatically.

Performs product recalls more effectively and
efciently.

Delivers the right product to the right patient.
E-code Serialization for a Pharma Major
cognizant 20-20 insights 7
Footnotes
1
GS1 is the international standards group whose healthcare component is working on pharmaceuticals
product tagging standards. The GS1 system of standards is the most widely used supply-chain standards
system in the world. It is composed of four key standards: barcodes (used to automatically identify items),
eCom electronic business messaging standards allowing automatic electronic transmission of data,
global data synchronization standards (GDSN), which allow business partners to have consistent item data
in their systems at the same time and EPCglobal which uses RFID technology for real-time item tracking.
For more information: http://www.gs1.org/about/overview.
2
Mass Serialization in the European Pharmaceuticals Market, Frost & Sullivan, page 23.
www.frost.com/prod/servlet/cio/140658996
3
http://drugstorenews.com/article/counterfeit-threat-intensies
4
http://www.contractpharma.com/issues/2012-03/view_features/packaging-serialization-update/
References

World Health Organization, Medicines: Counterfeit Medicines, Fact sheet No. 275 (January 2010),
available at www.who.int/mediacentre/factsheets/fs275/en.

Pharmaceuticals and Packaging News (PMP News), Combating Counterfeits, Sept. 9, 2011, available
at http://www.pmpnews.com/article/combating-counterfeits.

Center of Medicines in the Public Interest, Counterfeit Drugs and China NEW, available at
http://www.cmpi.org/in-the-news/testimony/counterfeit-drugs-and-china-new.

Pharmaceuticals and Packaging News (PMP News), Best Practices in Serialization, June 18, 2009,
available at http://www.pmpnews.com/article/best-practices-serialization.

GS1 Healthcare Reference book 2011/2012: http://www.gs1.org/docs/healthcare/GS1_Healthcare_
Reference_Book_2011-2012.pdf.

Life Science leader The Long Road to Serialization and Track and Trace, March 27, 2012, http://www.
lifescienceleader.com/magazine/current-issue-3/item/4083-long-road-to-usserialization-Track-and-trace.

Life Science Leader Planning Serialization for Pharmaceuticals Manufacturer:
http://www.lifescienceleader.com/magazine/current-issue-3/item/4124-planning-serializationfor-
Pharmaceuticals-manufacturers.

EFPIA Coding and Identication of Products: Towards Safer Medicines Supply:
http://www.efpia.eu/Content/Default.asp?PageID=566
Other Useful Links

http://www.bluespherehealth.com/wordpress/?p=236

http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2888553

http://www.healthcarepackaging.com/archives/2012/02/fda_changes_to_drug_bar_code_r.php

http://www.bluespherehealth.com/wordpress/?tag=serialization

http://www.bluespherehealth.com/wordpress/?p=845
About Cognizant
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About the Authors
Aravindhan Ramakrishnan is a Senior Consultant within Cognizant Business Consulting. He has extensive
experience across life sciences, energy and consumer goods industries. As an operations and technology
expert Aravindhan has been working with clients to help them transform their businesses. He focuses
on strategy development and implementation, technology strategy, organization design, operational
excellence and innovation management. Prior to Cognizant, Aravindhan was employed by IBMs Strategy
& Transformation Practice and by Honeywell. He holds a bachelors degree in engineering and an M.B.A.
Aravindhan can be reached at Aravindhan.Ramakrishnan@cognizant.com.
Ghazala Yasmin is a Consultant within Cognizant Business Consulting. She has over one year of experience
in management consulting and business development, and has supported projects across various
industries: life sciences, chemicals and consumer goods. She holds a bachelors degree in chemical engi-
neering and an M.B.A. from NITIE, Mumbai. Ghazala can be reached at Ghazala.Yasmin@cognizant.com.