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EU FMD: hospital pharmacy challenges and opportunities

The forthcoming EU Falsified Medicines Directive (FMD) is mandatory for all hospital pharmacies in Europe. The three-year implementation period ahead provides an extraordinary opportunity to improve patient safety and realise efficiency savings.

Falsified medicines may contain incorrect or low-grade ingredients, incorrect doses, or be inappropriately labelled. Therefore, they pose a significant threat to patient health. The European Medicines Agency defines falsified medicines as “fake medicines that pass themselves off as real, authorised medicines”, distinct from counterfeit medicines which do not comply with trademark law or intellectual property rights.

Though often perceived as a problem primarily affecting less economically developed countries and high cost medicines, the trade of falsified medicines is a lucrative industry affecting countries across all levels of development, and low as well as high cost drugs.1–3

In France in 2013, for example, 1.2 million doses of fake aspirin with no active ingredient were seized.4 In the USA in 2012, falsified Avastin (bevicuzumab; Roche, Basel, Switzerland) lacking active ingredient was discovered, affecting 19 medical practices.5

Other major branded drugs previously discovered to be falsified include Herceptin (trastuzumab; Roche, Basel, Switzerland), Viagra (sildenafil; Pfizer, New York City, USA) and Cialis (tadalafil; Lilly, Indianapolis, USA).5

Aiming to address this issue in Europe, on 1 July 2011, the Falsified Medicines Directive (FMD; Directive 2011/62/EU) was published in the Official Journal of the European Union.6 The FMD introduces measures to increase traceability of medicines and more easily identify packaging that has been tampered with, aiming to protect patients from receiving falsified medicines.

The adoption of this legislation has been described as the “largest change in the pharma industry in the last 40 years”,7 and as the Delegated Acts are rolled out8,9 and compliance is required, this change will be felt greatly – not only by industry, but also by pharmacists, doctors and patients alike.

Trade of falsified medicines is facilitated by the complex medicinal product supply chain. Beginning with the manufacturer, a drug may be passed to a wholesale distributor and in turn supplied to re-packagers or many possible retailers, including traditional community pharmacies, dispensing clinical practices, hospital pharmacies and internet pharmacies.

As supply chain routes have diversified and international trade, including parallel trade, has increased, the threat of and opportunity for falsified medicines to enter the legal and illegal supply chain has been greatly augmented. Online retail through internet pharmacies is a particularly abundant source of falsified medicines.

The single most challenging requirement mandated by the FMD is the authentication of medicines at the point of dispensing to patients – including in all hospitals – together with risk-based verification and traceability of medicines at wholesaler level. The ability to do this will rely on an authentication system which will identify unique serialisation numbers and 2D data matrices that will be printed onto product packaging.

These matrices will be verified as the product is passed through the supply chain and authenticated before dispensing to the patient. The central system will be updated with the latest information on drug safety and recalls, allowing pharmacists to verify authenticity and be alerted to any potential issues that are linked to the product.

Opportunities: Medicines verification and the FMD

Primarily, a verification system is designed to prevent unauthentic medicines from being dispensed to patients; however, it will also facilitate recall of products that are known to be faulty or inadequate; a far more prevalent issue in developed countries.10 In the UK between 2001 and 2011, there were a total of 291 MHRA drug alerts of which 233 resulted in recalls.10

Of these alerts, 96% (280) were substandard and 4% (11) were falsified.10 Although the rate of falsified medicines is increasing worldwide, for the time being the major concern relates to substandard medicine recalls and such a system would streamline communication between the regulatory bodies and healthcare professionals.

The implementation of an authentication and verification system also has several potential ‘secondary’ implications. A centralised, ‘end-to-end’ system storing data on all scanned medicines allows for simplified communication between supply chain actors and creates an incredibly rich source of information on how and when patients access and respond to medicines. As every medicine dispensed to the public leaves an electronic signature, the reimbursement process for pharmacists and clinicians could be greatly streamlined and possibly automated, as the centralised system provides a natural means for the necessary information to be communicated. Similarly, the movement of medicines in the supply chain could be easily tracked, facilitating identification of product shortage and/or wastage, and leading to more effective supply chain management than would be possible with many disparate suppliers not linked by a central database.

Box 1: Potential FMD hospital pharmacy opportunities

  • Reduction in wasted medicines
  • Reduction in expired medicines
  • Reduction in local medicines shortages
  • Increased opportunities for pharmacist engagement in patient care
  • More rapid and lower cost of product recalls
  • Reduced personnel time and costs assessing product due to tamper proof seals
  • Potential savings due to automated stock control and/or inventory management
  • Opportunities to identify improvements in pharmacy workflow

Pharmacovigilance could also be improved. At the point of dispensing, each scan could be linked to a unique patient identifier, and any reported adverse events could be recorded in the same system. It is feasible that the system could automatically detect the passing of certain safety thresholds associated with adverse events and notify retailers immediately, providing a much more rapid response than would be possible through traditional collection and analysis of such data. This could be particularly useful in empowering and facilitating adaptive pathways (previously called adaptive licensing), which require continuous assessments of drug safety over time.

A medicines authentication system could support the monitoring of inappropriate antimicrobial prescribing, a major factor influencing antimicrobial resistance, a global public health issue. The proposed medicines verification system would produce easily assessable, national and internationally comparable data, useful in identifying regions with higher than average antibiotic prescribing.

Finally, authentication systems may be applied to supporting patient engagement and adherence, one of the most significant challenges in both research and practice in the healthcare domain.11 Some currently available systems are capable of using information provided in scanned barcodes to communicate medicine-specific information directly to patients and this provides a potential channel for interventions to support adherence.12

Challenges: FMD and medicines verification

The dispensing process in the hospital setting can be convoluted due to the variety of complex pharmaceutical products supplied and the complicated drug distribution cycles present in secondary care. Although the dispensing process in the community setting is more straightforward it too experiences dispensing errors on a regular basis.13 There is currently no research available to identify absolutely whether or not the inclusion of a verification scan on products would over-complicate the dispensing process resulting in an increase in clinically significant dispensing errors.

Whether dispensing errors increase or not it is clear that the incumbent legislation will incur significant training costs for all parties affected from the manufacturer right down to the pharmacist or dispensing doctor. After all, the proposed system will only be truly effective in the face of a well-trained workforce, producing  negligible human error and 100% medication scanning/verification rates.
Despite best efforts, it is reasonable to expect that an IT system of this magnitude will have downtime and electronic errors, which would delay the dispensing of medicines.

Box 2: Potential FMD hospital pharmacy challenges

  • Split packs
  • Pharmacy robots
  • Satellite sites
  • Ward stock
  • Pack data matrix aggregation
  • ISV and Inventory Management System integration
  • Returns
  • Unit dispense


The worldwide battle against falsified medicines has been described as “all talk, no action”:14 there is no global system for reporting and disseminating information on falsified medicines. As a global problem, a global response is ultimately required; however, the FMD represents a world-leading attempt to provide harmonised legislation mandating digital traceability of medicines – a step that is surely required in this complex, multiple stakeholder healthcare delivery system – which can hopefully be imitated globally. It has implications beyond stemming the trade of falsified medicines in Europe, and will lead to an overall safer, more efficient, medicines supply chain, opportunities for improved clinical engagement as well as better-protected and better-informed patients.


Bernard Naughton*
Oxford University Hospitals NHS Trust, Headington, Oxford, UK

James A Smith*
Nuffield Department of Orthopaedics, Rheumatology and Musculoskeletal Sciences, University of Oxford; The Oxford–UCL Centre for the Advancement of Sustainable Medical Innovation (CASMI), University of Oxford, UK

Anna Ohanjanyan
The Oxford-UCL Centre for the Advancement of Sustainable Medical Innovation (CASMI), University of Oxford UK and MBE, Programme Department of Chemical Engineering and Biotechnology, University of Cambridge, UK

Graham Smith
Aegate Ltd, Cambridge Technology Centre, Melbourn, UK

Sue Dopson
Said Business School, University of Oxford, UK

Robert Horne
Centre for Behavioural Medicine, UCL School of Pharmacy, University College London, London, UK

David A Brindley
Nuffield Department of Orthopaedics, Rheumatology and Musculoskeletal Sciences, University of Oxford; The Oxford – UCL Centre for the Advancement of Sustainable Medical Innovation (CASMI), University of Oxford, UK; Said Business School, University of Oxford, UK; Centre for Behavioural Medicine, UCL School of Pharmacy, University College London, London, UK; Harvard Stem Cell Institute, Cambridge, MA, USA; USCF-Stanford Center of Excellence in Regulatory Science and Innovation (CERSI), USA

*Equal contributions

Contribution statement

All authors were responsible for conception and design of the experiment, and revised the work critically for important intellectual content. JAS and BN wrote the manuscript.

Data sharing statement

No additional data available.


We wish to express our sincere thanks to the following organisations that have contributed to the CASMI Translational Stem Cell Consortium (CTSCC) as funding and events partners, without whom the consortium and the benefits it will bring to stem cell translation would be constrained: GE Healthcare, CCRM, Sartorius Stedim Biotech (formerly TAP Biosystems), Lonza, CIRM, SENS Research Foundation, UK Cell Therapy Catapult, NIH Centre for Regenerative Medicine, NYSCF, ThermoFisher Scientific, Eisai, Medipost (US), Medipost (Korea), Celgene, Roche and Oxford Biomedica. DAB gratefully acknowledges personal funding from the Oxford Musculoskeletal NIHR BRU, the Said Foundation and the SENS Research Foundation. JAS gratefully acknowledges support from the CASMI Translational Stem Cell Consortium (CTSCC).


The content outlined herein represents the individual opinions of the authors and may not necessarily represent the viewpoints of their employers. GS is an employee and/or stockholder in Aegate Ltd (Melbourn, UK) that is a provider of medicines authentication services. DAB is a consultant of Aegate Ltd and a stockholder in Translation Ventures Ltd (Charlbury, Oxfordshire, UK), a company that among other services provides cell therapy biomanufacturing, regulatory, and financial advice to pharmaceutical clients. DAB is a stockholder in IP Asset Ventures Ltd (Oxford, UK), a company that provides strategic advisory services to life science clients. JS is a consultant is IP Asset Ventures Ltd. DAB is subject to the CFA Institute’s Codes, Standards, and Guidelines, and as such, this author must stress that this piece is provided for academic interest only and must not be construed in any way as an investment recommendation. Additionally, at time of publication, DAB and the organisations with which he is affiliated may or may not have agreed and/or pending funding commitments from the organisations named herein. BN is a consultant of Aegate. BN is also a registered UK pharmacist and therefore complies with GPHC codes, standards and guidelines and stresses that this publication is provided for academic interest only. RH has undertaken speaker engagements with honoraria with the following companies: Abbvie, Amgen, Biogen Idec, Gilead Sciences, GlaxoSmithKline, Janssen, MSD, Pfizer, Roche and Shire Pharmaceuticals. RH is founder and shareholder of a UCL-business spin out company (Spoonful of Sugar) providing consultancy on medication-related behaviours to healthcare policy makers, providers and industry.


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