Building a Global Traceability Foundation to Drive Visibility, Efficiency and Compliance Common Misconceptions and Key Considerations Robin Koh, Chief Strategy Officer, SupplyScape Corporation

Agenda Main Drivers for Global Track and Trace Key Considerations for Building Global Traceability Foundation 4 Common Misconceptions Implementation Approach to Global Serialization Key Takeaways

Main Drivers for Global Track and Trace

Key Considerations for Building Global Traceability Foundation

4 Common Misconceptions

Implementation Approach to Global Serialization

Key Takeaways

Safe & Secure Supply Chain Model Safe and Secure Supply Chain Pharmaceutical Co Wholesaler Pharmacy Chain of Custody Security Transaction Security Trace Track Pedigree Individual Product Security Product Security Product Authentication ID Authentication Authentication

Drivers For Global Traceability Regulatory Compliance Product Security Global Traceability Regulatory Compliance States considering pedigree laws / rules PDMA in effect. No state activity States with pedigree laws / rules today US Pedigree Regulations In place In development Global Serialization & Codification Regulations 70% Medical Professional 18% Subscriber Global Pharma Safety Incidents Sources: Organisation for Economic Co-operation and Development 964 04 196 02 484 03 1,123 05 1,412 06 1,759 07 Product Security Source: BCBSA Survey of Blue Plans’ Anti-Fraud Programs Reimburse In-accuracy 5% Med Unnec. 36% Services Not Rendered 9% Excess Charges 35% Other (1) 2% Pharm Fraud 4% Service Over Utilization 9% Upcoded Service

Complexity of Global Serialization Proliferation of Regulatory Requirements Time to implement serialization is usually underestimated Flexibility to handle future requirements is often overlooked Business benefits are difficult to quantify

Time to implement serialization is usually underestimated

Flexibility to handle future requirements is often overlooked

Business benefits are difficult to quantify

Agenda Main Drivers for Global Track and Trace Key Considerations for Building Global Traceability Foundation 4 Common Misconceptions Implementation Approach to Global Serialization Key Takeaways

Main Drivers for Global Track and Trace

Key Considerations for Building Global Traceability Foundation

4 Common Misconceptions

Implementation Approach to Global Serialization

Key Takeaways

Misconception #1: ‘ I Can Wait’ Case Study A global manufacturer planning for France’s (CIP13) 2D Data Matrix requirement in 2011 Lesson’s Learned Many variables lengthen the time for implementation Number of qualified vendors available Working with CMO networks is more involved than expected Piloting 1 or 2 packaging lines does not adequately prepare for the scalability issues associated with a corporate roll-out The Plan is Nothing, but Planning is Everything Dwight D Eisenhower

Case Study

A global manufacturer planning for France’s (CIP13) 2D Data Matrix requirement in 2011

Lesson’s Learned

Many variables lengthen the time for implementation

Number of qualified vendors available

Working with CMO networks is more involved than expected

Piloting 1 or 2 packaging lines does not adequately prepare for the scalability issues associated with a corporate roll-out

Misconception #2: ‘Serialization has Limited ROI’ Least Realistic More Realistic CAPEX Packaging CAPEX ACF Program ACF Impact on Line Efficiency Additional Labor Data Monitoring CAPEX-Internal Additional Label Cost CAPEX CMO CAPEX DC Software Maintenance Recurring Benefit CAPEX - One Time Running Cost CAPEX IT Anti-Counterfeit Program #2 Patient Safety Program #1 Label Standardize Program Sales Enhancement Program #2 Anti-Counterfeit Program #1 Recall Enhancement Program Supply Chain Efficiency Program SC Visibility Program #1 Sales Enhancement Program #1 Data Reform Program Benefit Programs by Level of Effort Required and the Magnitude of Benefit Upside Potential Downside Impact

Misconception #3 ‘ Countries are Driving Towards One Standard’ Case Study In the original design of the MIT solution, there is a fundamental assumption that there will be a homogenous number management system Lesson’s Learned Harmonizing on data carriers & numerical structure are different things Number assignment from multiple sources Random numbers and non-sequential numbers are different things There is no guarantee on future requirements Your Requirements vs. Available Solutions

Case Study

In the original design of the MIT solution, there is a fundamental assumption that there will be a homogenous number management system

Lesson’s Learned

Harmonizing on data carriers & numerical structure are different things

Number assignment from multiple sources

Random numbers and non-sequential numbers are different things

There is no guarantee on future requirements

Misconception # 4 ‘ Serial Number Lookup is an Authentication System’ Building a more complete system : Alert Patients on Adverse Events in Real Time (e.g. Recall) Provide Accurate Data for Detection and Prevention in addition to Investigation Pattern, Pace & Place Detect False Positives Authenticate Physical Anti-Counterfeiting Features Product Security Product Authentication ID Authentication Authentication Individual Product Security

Building a more complete system :

Alert Patients on Adverse Events in Real Time (e.g. Recall)

Provide Accurate Data for Detection and Prevention in addition to Investigation

Pattern, Pace & Place

Detect False Positives

Authenticate Physical Anti-Counterfeiting Features

Agenda Main Drivers for Global Track and Trace Key Considerations for Building Global Traceability Foundation 4 Common Misconceptions Implementation Approach to Global Serialization Key Takeaways

Main Drivers for Global Track and Trace

Key Considerations for Building Global Traceability Foundation

4 Common Misconceptions

Implementation Approach to Global Serialization

Key Takeaways

Suggested Approach to Global Serialization Global Framework, Local Alignment Develop a clear understanding of costs, timing, resources and operational changes needed to meet requirements Develop local guidance based on corporate standards Construct and execute a plan to address immediate requirements using localized approach Build a migration plan to integrate into corporate strategy Execute the integration plan to migrate local solution into global strategy Define Global Strategy & Guidelines Address Local Requirements Migrate To Global Plan

Develop a clear understanding of costs, timing, resources and operational changes needed to meet requirements

Develop local guidance based on corporate standards

Construct and execute a plan to address immediate requirements using localized approach

Build a migration plan to integrate into corporate strategy

Execute the integration plan to migrate local solution into global strategy

Agenda Main Drivers for Global Track and Trace Key Considerations for Building Global Traceability Foundation 4 Common Misconceptions Implementation Approach to Global Serialization Key Takeaways

Main Drivers for Global Track and Trace

Key Considerations for Building Global Traceability Foundation

4 Common Misconceptions

Implementation Approach to Global Serialization

Key Takeaways

Serialization is Global and Uncoordinated EU, China and USA moving in parallel Manufacturers must Assume a Global Perspective There are a set of concrete steps you can take Serialization can Provide ROI if you know where to look Few Vendors Understand the Global Issues and Misconceptions Key Takeaways

Serialization is Global and Uncoordinated

EU, China and USA moving in parallel

Manufacturers must Assume a Global Perspective

There are a set of concrete steps you can take

Serialization can Provide ROI if you know where to look

Few Vendors Understand the Global Issues and Misconceptions

Looking Forward Business Opportunities in Supply Chain Traceability What if you could? Leverage investments in product serialization initiatives to drive a higher return on product and brand protection? Increase new product launch success by ensuring proper supply into key markets? Establish a global network of trading partners to provide greater visibility into distribution channels ? Overcome barriers to entry into new markets by more efficiently addressing local distribution requirements? Facilitate financial reconciliation across chargeback, rebate, and re-imbursements across your supply network?

What if you could?

Leverage investments in product serialization initiatives to drive a higher return on product and brand protection?

Increase new product launch success by ensuring proper supply into key markets?

Establish a global network of trading partners to provide greater visibility into distribution channels ?

Overcome barriers to entry into new markets by more efficiently addressing local distribution requirements?

Facilitate financial reconciliation across chargeback, rebate, and re-imbursements across your supply network?

Next Steps Get Started on Developing a Global Traceability Foundation Contact Mary Hall today to schedule a consultation! 781.503.7462, mhall@supplyscape.com Visit SupplyScape.com to learn more www.supplyscape.com