FDA exemption for connected trading partners

Chris Wirrig
Spherity
Published in
3 min readOct 11, 2024
credit: Simone Lugli (Pixabay)

DSCSA news are coming in thick and fast these days.

Following their exemption for small dispensers in July 2024 and recurring reminders of the waivers, exceptions and exemptions (WEE) request process, FDA has just issued a new large-scale exemption to connected trading partners concerning enhanced drug distribution security (EDDS) and directly related requirements.

Specifically, the duration of the exemption depends on the type of trading partner:

  • Manufacturers and Repackagers: May 27, 2025
  • Wholesale Distributors: August 27, 2025
  • Dispensers with 26 or more full-time employees: November 27, 2025

This feels like a Galgenfrist (literally translated as the final grace period before the gallows) — the very last reprieve before a big known event happens.

That event is full enforcement of DSCSA.

FDA refers to connected trading partners as those being eligible for this particular exemption. These are “trading partners who have initiated their systems and processes, as described in section 582(g)(1) of the FD&C Act, including electronic DSCSA data connections (which may include portals) with their immediate trading partners by November 27, 2024.” In less legalese, “trading partners who have successfully completed or made documented efforts to complete data connections with their immediate trading partners, but still face challenges exchanging data.” Downstream trading partners are exempt by association only whenever they transact affected products.

Now, let’s take a closer look.

who have initiated their systems and processes

The wording strongly suggests that this exemption will not apply to trading partners who have not prepared and documented anything substantial regarding the implementation of “data connections with their immediate trading partners.” The exemption announcement ends with the familiar, clear call to action, “FDA strongly urges trading partners to continue their efforts to implement necessary measures to satisfy these enhanced drug distribution security requirements.” EDDS requirements go beyond getting EPCIS sorted, may I add.

Let this sink in.

If you have made no reasonable efforts regarding EPCIS, DSCSA will apply to you full whack come November 27, 2024 unless you have been granted another exemption.

but still face challenges exchanging data

If you don’t need to utilise this exemption, then don’t. FDA makes that clear in their announcement too. “If trading partners do not need to rely on the exemptions in this document, […] we advise them to exchange electronic DSCSA transaction information and transaction statements and meet all other requirements of section 582(g)(1) of the FD&C Act beginning November 27, 2024.”

Which requirements are affected?

  • 582(g)(1)(A)-(F) of the FD&C Act = EDDS
  • 582(c)(4)(D) of the FD&C Act = Verification requirements for wholesale distributors concerning saleable returned product
  • 582(d)(4)(A)(ii)(II) and (B)(iii) = Verification requirements for dispensers concerning illegitimate or suspect product

This exemption demonstrates that FDA understands that

  • EPCIS data exchanges and
  • the resulting exception handling

are crucial, yet still not as smooth as anticipated and, thus, would hamper the reliable supply of medicines to patients, which could result in avoidable disruptions and shortages. These insights match observations published in the recent report on DSCSA readiness by the Louisiana Board of Drug and Device Distributors.

Brief reminder, the Stabilization Period ends Nov 27, 2024 no matter what. Exemptions are a top-up period for eligible trading partners to advance their readiness, not a permission to do nothing. A whole host of DSCSA requirements are already enforceable and not affected by the above exemptions.

Disclaimer

Since this post focuses on legal and regulatory requirements, I’d like to make clear that I’m not qualified to provide legal advice. Nothing stated here should be taken as such.

Why am I writing about this? — Because FDA puts strong emphasis on digitalising the US pharma supply chain, especially through its EDDS guidance. I currently work for a technology solution provider (Spherity) that offers a tool to perform automated electronic ‘Authorized Trading Partner’ checks via Verification Router Services. So, the topic is not only close to my job but also super interesting to think about and watch unfold.

Further reading

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Published in Spherity

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Chris Wirrig
Chris Wirrig

Written by Chris Wirrig

Former biomedical research scientist. Working on enterprise SSI. Love sharing knowledge. European citizen.

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