Serialisation is not enough

A global technology leader in supply chain security, Systech’s revolutionary solution provides authentic, safe and connected products throughout the pharmaceutical supply chain. Dr Kevin Robinson recently caught up with CEO Ara Ohanian to find out more

For more than 32 years, Systech has been putting technology on the line, pioneering pharmaceutical serialisation as well as developing innovations in line vision and inspection, packaging line management and track and trace.

Today, according to Ara Ohanian, CEO of Systech, the company is revolutionising brand protection. “Our software solutions ensure that products are authentic, safe and connected across the entire supply chain, from manufacturing to the consumer’s hands; but, why come up with a digital fingerprinting technology is perhaps the bigger question,” he says.

“Our history, which is kind of interesting … and why this is a fundamental part of the industry’s future … is that we really pioneered the concept of serialisation when Pfizer asked Systech to protect the most counterfeited product in the pharmaceutical industry. We implemented an online barcode serialisation solution that coded Viagra bottles with a 2D barcode at 250 ppm and tracked them through the supply chain."

"In time, we were able to establish a viable track and trace solution; but, to do so, we had to focus on real-time vision, inspections and the ability to create a mark or barcode and subsequently serialise it. This drove us to continually invest in the technology to read poorly printed barcodes at production rates.”

“To do that well at high speeds,” he continues, “we realised that we would have to eliminate the so-called ‘natural noise,’ including naturally occurring factors such as the ink, humidity, substrate variations and vibration germane to production environments. By taking those elements out of the equation, you can more rapidly take a more accurate picture of the required information and give it a unique number.”

The profits of that, essentially the by-product of the vision system behind serialisation, is the ability to take out the noise and, fundamentally, extract something that, although secondary information, is unique. “Five years ago, one of our scientists made an interesting observation about reverse engineering the random ‘noise’ created by nature. He suggested that the chance of the noise for any given print being reproduced is impossible. So, based on that, we created a unique technology solution that derives a fingerprint using that data,” notes Ara.

“As civilisation is moving forward and we look at the pharmaceutical industry, the biggest threat to global drug production is that of perpetrators within the supply chain. They’re getting more and more sophisticated and, as they’re not hampered by operational costs or regulation, they’re able to invest in extremely complex equipment to duplicate packaging, barcodes, holograms, etc."

"And without any doubt, that threat has now gone beyond current security and anticounterfeiting solutions on the marketplace. So, although governments are regulating to the best of their ability, I’m going to go all James Bond movie on you for a second and suggest that serialisation is not enough,” he adds. The counterfeit drugs trade is thought to be the world’s largest fraud market, with the World Health Organisation estimating counterfeit drug revenue to be approximately $200 billion and that 10–15% of worldwide pharmaceutical trade is suspect.

Fighting the good fight

Providing a solution that was recently recognised at the CPhI Pharma Awards in the “Excellence in Pharma: Supply Chain, Logistics and Distribution” category, Systech UniSecure is a non-additive authentication solution that works with existing product packaging and a mobile app.

UniSecure’s mission is to change everything without changing anything, hence leveraging the existing packaging without adding anything physical to it. Its digital e-Fingerprint technology delivers a revolutionary defence against the increasing threats of product diversion and counterfeiting. Commenting on the award, Ara said: “We are dedicated to innovating the way the industry addresses attacks to their supply chain. UniSecure technology is empowering companies to protect their consumers, brand reputation and revenue from the counterfeit and diversion challenges of tomorrow, today.”

Likening the technology to the concept of coding versus non-coding DNA, I ask Ara whether that’s an appropriate metaphor. “Absolutely,” he says: “Every single image you capture from a product packaging’s existing barcode comprises a certain amount of visible ‘DNA,’ a fingerprint if you like, which consists of natural noise around what you print, and that’s what we’ve patented. That ‘extra’ information creates a digital e-fingerprint that can be stored in the cloud, for example, and retrieved whenever required to check whether a product is counterfeit or has been diverted into the wrong market.”

FMD and the supply chain

Ara Ohanian, CEO, Systech

I put it to Ara that the incoming FMD/DSCSA regulations may not be broad-reaching enough. He agrees, saying: “You have to take the context into perspective, because, coming from an e-learning background as I do, we used to say that ‘knowledge is power … and speed-to-knowledge is victory.’"

"In the pharma and life science industry, it’s all about the sanctity of life. So, in that environment, you want to know when (and where) the lives of patients are under most threat and act accordingly. If you take Europe or North America, for example, the chances that the medication that reaches you is fake or adulterated are very low; it’s most likely come through the regular channels. In other markets, say Asia, South America or Africa, that level of threat rises tenfold, where, as many as one in three drugs are counterfeit.”

“If you then look at serialisation, it’s been designed and regulated for developed geographies, focusing on track and trace, spotting when things go wrong and instigating recalls when needed. But the threat of perpetrators operating in those regulated regions is not particularly high. When you start manufacturing and distributing product in lower cost areas, where diversion is big business, that’s when the regulation and serialisation infrastructure of today falls apart."

"So, if we add the ability to fingerprint anything that has or has not been serialised/regulated, then you provide another level of supply chain security. In the long-term, we have to question whether serialisation in its current form is an adequate solution. It is not."

"And this is why we developed UniSecure. Many of our large customers are now working beyond the current regulations and implementing next-generation authentication technologies. They’re innovating for safety, which is both gratifying and reassuring.”

A cost-effective system

Asking about the implementation of UniSecure in terms of cost, compared with other overt/covert solutions, Ara explains that, even beyond pharma, many companies use additional anticounterfeit solutions such as holograms, invisible ink, etc.

“The issue,” he says, “is a combination of cost versus threat. Many of these solutions rely on tangible additives that you put into the packaging and are vulnerable to criminal exploitation (reverse engineering/duplication). In terms of cost, the regulation of serialisation solutions today requires software and hardware investments, validation expenses and process optimisation expenditure."

"Even when you’re dealing with a high-value product, you can bury a cost of 10–20 cents, for example, but the economics of manufacturing millions of low-value generics just don’t add up. The beauty of digital fingerprinting is that it’s fast, cost-effective and easy to implement … and delivers a whole other level of safety and traceability.”

Adding blockchain security

Being fascinated with blockchain for a while, Systech has developed a tangible solution for the pharmaceutical industry. Fad or the future, the company has now partnered with FarmaTrust to provide a revolutionary blockchain-enabled solution that leverages FarmaTrust’s blockchain and AI technologies.

“In Systech’s continued commitment to advance supply chain security, we have partnered with FarmaTrust to integrate their proven blockchain solutions,” said Ara, adding: “By combining their bulletproof blockchain and AI solution with our authenticated and trusted e-Fingerprint technology, we have created a fool-proof solution in the fight for pharmaceutical supply chain safety and authenticity.”

Raja Sharif, FarmaTrust’s CEO, stated: “This is a significant deal and we are fortunate to work with Systech and integrate our blockchain technology with their compliance, traceability and authentication solutions. This combination is the only non-additive solution that can guarantee product authenticity throughout the supply chain journey. It’s also great to have a partner who has global coverage as well as a 32-year history of partnering with the world’s 20 largest pharma companies.”

“Blockchain’s ability to deal with virtual commodities is well-established,” says Ara, “but when you’re dealing with physical product, the key issue is ensuring that the link between the digital world and the physical one is intact. And this is where we come in. If the blockchain captures data that represents a product in the physical world, and someone has infiltrated that supply chain, you start tracking a counterfeit item … and the blockchain doesn’t know."

"This is its greatest weakness outside the physical realm, knowing the provenance of the data that’s being protected. We’re aiming to become the security link between the two worlds — physical and digital — with the ultimate aim of protecting human lives.”

Whether conservative Big Pharma will be willing to take such technologies on board remains to be seen, but Ara is optimistic. He cites a top 20 company in the market who, as soon as they saw what digital fingerprinting could offer, implemented a plan to include it in every one of their products … and then asked whether they could blockchain it.

“At the higher levels of many organisations, there is no doubt that the link to blockchain is recognised and cannot be ignored; it enhances usability, trust, portability, brand protection, ease of sharing and commerce. The question right now is one of how, not when!” observes Ara.

Looking ahead

Discussing the imminent future, Ara talks about going back to basics and helping the companies he works with to implement the next generation of supply chain security. “It’s about three things: safety, authenticity and connectivity. We need to ensure that drug manufacturers are more advanced than the perpetrators in terms of technology. At the same time, we’re looking into expanding into the consumer market. Items such as lipstick, shampoo, etc., if contaminated or adulterated, could have far reaching and devastating effects,” he says.

As their technology becomes more advanced and cheaper, criminals are now able to duplicate a much wider range of products, including those that cost very little. Ara concluded: “Somewhat sadly, this is opening up a whole new area of business for us; but, whether it’s a pharmaceutical drug, a consumer product or even a bottle of wine, we remain committed to protecting individual items, brands and, most importantly, human health, from unlawful activity throughout the entire supply chain.”

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