Smart labels could smooth stressed medical supply chains

Every minute, unsafe care kills at least five people die around the world, according to the World Health Organization (WHO.) WHO identifies medication errors and unsafe prescribing as the leading avoidable cause of these deaths.

Now, the new ‘smart’ medication label technology could help improve those odds. By giving healthcare providers real-time data, smart labels can reduce mistakes, improve supply chain security and add vital information to monitoring patients’ health.

What are medication smart labels?

Smart labels use radio-frequency identification (RFID:) electromagnetic fields that automatically identify and track tags attached to objects, such as medication containers. But why is this helpful?

Using RFID gives hospitals more accurate, real-time data they can use to manage their medication inventory. Like how microchips improve credit and debit card security, RFID helps ensure medications are authentic. Counterfeit medication is a big problem in the developing world, affecting an estimated 10 to 30 percent of prescribed drugs.

“With smart labels, you can track the medication all the way through the supply chain for tracing and visibility,” says Gary Burns, CEO and co-founder of eAgile, a US-based company providing RFID, internet of things (IoT) and other solutions.

How smart labels work

A smart label is like a barcode. The provider can gather medication-related information by scanning it. But barcode data is limited, static and easy to counterfeit.

The RFID tag, sometimes called a ‘radio barcode,’ contains a microprocessor that tracks data wirelessly and in real-time, like where it’s been and how it’s been used. It captures data automatically, and its unique identification number makes it hard to copy and more tamper-resistant.

Research published in the Online Journal of Nursing Informatics concluded smart labels’ benefits include safety, tracking and efficiencies like data accuracy, reduced administration and money savings.

With RFID, healthcare practitioners can quickly check a medication’s authenticity and access other data without the need for line-of-sight scanning. They can always have an accurate, real-time inventory.

“A barcode only gives you the last known scan. The medication could have been used, wasted or disappeared,” Burns says. “RFID tags give a record and time-date stamp of what it is, and where and when it was moved.”

Smart labels are mostly applied to highly controlled drugs such as opioids, critical drugs such as anesthetics and high-value medications like cancer treatments.

Jay Williams, Vice President of Business Development at IntelliGuard, a US company that provides RFID technology, says, “[Smart labels] ensure the product is always there when needed.”

Ending manual errors and inefficiencies

RFID technology is not new. Hospitals often use it to track assets, but not widely for drug management. Williams estimates about 10 to 15 percent of hospitals now use RFID for medications.

One challenge with smart labels is the manual labor of the inventory process. Traditionally, pharmacists would manually attach each RFID tag to every vial, type the critical information into the computer and then associate the tag with the product in the system.

Manual inventories are time-consuming. A 2016 survey of 400 healthcare workers found 78 percent were counting inventory manually in some parts of their supply chain. Some spent nearly one day a week managing their supply chain and inventory. This explains why hospitals have been hesitant to adopt smart labels: Manually associating RFID tags is labor-intensive and prone to human error.

Pharma companies are stepping in to solve these challenges, applying smart labels as a service to their customers. Instead of hospitals doing the work, the manufacturers use companies like eAgile to program the drug’s serial number and data into the RFID tag, attaching labels on the production line.

By applying smart labels, pharmaceutical companies will help reduce manual labor [for hospitals and pharmacies.] We think smart-label adoption will grow as more pharmaceutical manufacturers provide them as part of the product.

Jay Williams, Vice President of Business Development at IntelliGuard

In September 2020, global pharmaceutical manufacturer Fresenius Kabi began applying smart labels for an anesthetic product. It has smart tags for another 21 medications on its roadmap for 2021. “By embedding the RFID tag in the label, it saves the pharmacy all that inventory receiving time,” says Jeanne M. Sirovatka, Director of Continuous Improvement for Fresenius Kabi.

Sirovatka notes that a barcode and an RFID tag each take a second to scan. But scanning a hundred barcodes will take a hundred seconds while scanning a hundred RFID tags takes one second because the RFID reader simultaneously scans multiple tags.

“And scanning the barcode only provides some product information, not all the supporting information that’s critical to patient safety,” she adds. This includes, for example, medication expiration date.

Eliminating manual data entry also reduces the chance of human error, improving patient safety. A nurse administering a narcotic would usually have to account for each dose manually. Smart labels track the drug’s use automatically.

“Instead of spending time on inventory, the pharmacy could use that time on clinical activities,” says Gwen Volpe, Fresenius Kabi’s Director of Medication Technology and Pharmacist. “And there’s added safety because we know our data is accurate.”

IntelliGuard also produces a smart anesthesia station that automatically reads smart labels, preventing distractions in the operating room. “In some cases, anesthesiologists have to turn their back on the patient in the operating room to scan a barcode,” says Burns of eAgile. “With the smart anesthesia station, they just access the medication through an RFID-enabled door, and there’s a record that the product moved.”

The need for standards

While embedding RFID tags on the manufacturing line solves one challenge, there are other barriers to adoption. Burns believes there needs to be global standardization to overcome cost and interoperability issues. “We need the healthcare medication supply chain to be as low cost as possible,” Burns says. “Everything must work together seamlessly – open, worldwide standards need to be followed.”

Industries like healthcare, retail and logistics have been using GS1 barcode standards worldwide since 1974, enabling barcodes to become the ever-present phenomenon we see today on anything from a pack of gum to cell phone packaging. Global non-profit GS1, with more than two million industry members, sets standards by consensus.

There have been GS1 standards for RFID tags for more than a decade, but Fresenius Kabi is the first pharmaceutical company to adopt them to encode smart labels. “Using GS1 standards, rather than proprietary numbers, makes it much easier for hospitals to decode the data,” Fresenius Kabi’s Gwen Volpe says.

Smart labeling’s chicken-and-egg problem

Even with standards in place, hospitals must still buy universal RFID scanners – they’re different than barcode scanners. Volpe’s colleague Sirovatka notes it’s a chicken-and-egg problem. “As a manufacturer, we want to encourage this technology for use in hospitals because it’s more efficient and safer,” she says. “But to make it attractive to hospitals, we need more manufacturers supplying pre-embedded labels so hospitals will purchase the scanning equipment.”

IntelliGuard was the first tech vendor to adopt GS1 standards, making its smart cabinets and anesthesia stations compatible with Fresenius Kabi’s labels. Volpe hopes more pharmaceutical and technology manufacturers will follow suit. “Having more medicines pre-tagged with RFID would create a turning point for GS1 to become a standard for hospital inventory,” she says.

A growing market

Standardizing the smart label industry would have results like how consumers currently use credit cards. We can use them anywhere in the world. Merchants can accept cards from different issuers, regardless of country of origin, without needing a scanner for each type of card. The embedded chip makes the transaction more secure. “In the same way, any healthcare provider around the world would be able to scan a standard smart label,” says Burns.

Market analysis firm Grand View Research says the pharmaceutical tracking segment generated its largest revenue in 2018 in the healthcare RFID market. Whatever the reason for adopting smart labels, those healthcare organizations are paving the way, and others will see the opportunity. The COVID-19 pandemic has affected revenues as many hospitals have stopped elective procedures that help balance the budget. As the industry looks to rebound and innovate, hospitals may find smart labels an appealing way to improve efficiency.