ARC study on RFID systems

After all, tracking and tracing capabilities can be used to track product and package pedigree or to facilitate product recalls, both of which manufacturers can do more easily if they have the ability to track product through the channel.

RFID is particularly suitable for combating counterfeiting, and the FDA has already recommended that RFID be part of a layered approach to counterfeit prevention that also includes tamper-evident packaging, bar codes, and other forms of security such as hidden inks. While the early portions of the FDA timeline stress cases and pallets, by late 2007 it is likely that most item-level pharmaceuticals will be tagged as well.

Chantal Polsonetti, ARC Advisory Group vice president and author of a just issued report titled “RFID Systems in the Manufacturing Supply Chain,” explains: “The RFID market potential in pharmaceuticals is huge, with over 12 billion units as candidates for item-level tagging in the United States alone. Unlike the experience with retailer-driven mandates whose business value is distributed unequally throughout the supply chain, pharmaceutical manufacturers can easily justify using passive tags all the way down to the item level on the basis of tracking and tracing requirements. Pharmaceuticals also have a higher price tag and margin relative to retail products that could only accommodate item-level tagging at a tag price of five cents or less.”

Polsonetti’s report provides strategic information, including RFID tag, reader, and other hardware market size and potential, leading suppliers, key factors that contribute to market growth, market dynamics, and strategic issues that suppliers will face. Additional information on this market study is available at www.arcweb.com/res/rfid.