The RFID Growth Conundrum

You don't have to veer too far into major industry sectors these days without bumping into the quickening pace of adoption of RFID tagging.

Wal-Mart, for instance, is driving RFID adoption in its supply chain by mandating that trading partners adopt pallet-level RFID use.

The Department of Homeland Security expects RFID chips to be on our passports in the not-too-distant future. And federal and state border patrol authorities are mandating adoption of RFID use for border control.

In-Stat research says 33 billion radio tags will be produced by 2010, tracking Pepsi, people and everything in between. That's up from about 1.5 billion tracking devices that were made last year.

But the pharmaceutical industry could be the ripest of all for rapid adoption. The reason is simple: money.

Counterfeiting RFID

Counterfeiters are increasingly aiming at the U.S. market for their fakes because of their higher price. Most, if not all, of the major drug makers are in the midst of trials for embedding sensors across their manufacturing and supply chains.

Paul Chang, of the worldwide sensor and actuators development group within IBM's software division, says by some accounts 35 million prescriptions a year are filled with counterfeit drugs in the United States.

How do you tell the fakes from the real ones? Look at the label and check the bar codes.

But the copycats have gotten pretty good at that. And they're getting into the supply chain at a rapid clip. The FDA has seen the number of counterfeit cases go from 57 to four times that in two years.

The drug companies are looking at item-level tagging to make sure each bottle matches the batch number etched on the tiny silicon chips before they were attached to bottles for the drug batches.

So how does this stop counterfeiters? It doesn't, but it sure can slow things down.

For starters, RFID systems, which include a silicon chip and an antenna that conducts information etched on that chip, cost money. The chipmaker burns a serial number into the chip, which is then processed and tested.

As Chang explains, you then take that chip and assign a unique number to it for the batch of drugs, which is then stored in what's called an EPC number.

If you're a downstream end-user and you want to check the validity of the drugs, you make sure the chip ID matches the EPC number. That's a feature of RFID that bar codes just can't match.

"We don't think this is going to stop the counterfeiters. But we think by using RFID, it does raise the bar pretty high," Chang says.

The Food and Drug Administration (FDA) recently put out a note urging companies to look into RFID as a way to maintain control over their drug supplies.

The FDA's taskforce on battling counterfeit drugs "recommends that stakeholders continue to work expeditiously toward that goal, and that their implementation of RFID technology be used first on products," it stopped short of applying deadlines for adoption.

Although it says widespread use of so-called e-pedigrees using electronic track-and-trace technology, including RFID, would provide an electronic safety net for our nation's drug supply, adoption is getting bogged down by, you guessed it, standards.

But standards need to continue apace with security and privacy issues.