PURDUE PHARMA, H.D. SMITH PLAN TEST OF ELECTRONIC TRACKING OF DRUGS

Several companies are expected to announce today the first commercial
effort to use a radio-frequency identification-tracking system for drugs.

Starting in July, Purdue Pharma LP, maker of painkiller OxyContin, and drug
wholesaler H.D. Smith will be trying out the "electronic pedigree" tracking
system to record the movement of Purdue Pharma's drugs.

Two technology companies are working with Purdue Pharma and H.D. Smith on
the system, which could serve as a national model because it is the first
to comply with pending state legislation.

With more than a dozen states pushing for laws that will create a record of
the path a drug takes from manufacturer to patient, the drug industry is
trying to develop a viable electronic-tracking system. An increase in
counterfeit drugs is prompting greater vigilance and control over the
nation's drug supply.

Regulators have said the current system is easily susceptible to tampering
and theft.

In many instances, state lawmakers and industry favor tracking systems that
use electronic fingerprints. Some wholesalers and pharmacy operators have
said an electronic system is too costly.

There has been great debate in the industry over who will be responsible
for implementing radio-frequency identification-tracking systems or other
electronic-tracking technologies.

With RFID, tiny tags with radio antennas are placed on products and then
read and recorded at each stop along the supply chain. By the time the
drugs reach a patient, there is a record of where they have been.

The pilot program reflects the work of four companies. According to Aaron
Graham, vice-president of corporate security at Purdue Pharma, of Stamford,
Conn., the drug maker has spent $2 million on the technology. Now when its
products, including the widely abused painkiller OxyContin, are sold to
wholesaler H.D. Smith, of Springfield, Ill., both companies will have an
electronic record of each drug's path.

Technology company SupplyScape Corp., Cambridge, Mass., pioneered the
software that produces the electronic pedigree. Unisys Corp., Blue Bell,
Pa., is implementing the technology for the drug maker and wholesaler.

Florida and Indiana recently passed pedigree laws, which will become
effective in July 2006.

Though by law, the industry can adopt paper or electronic pedigrees, "the
technology is available now," said Brenda Kelly, vice president of
marketing for SupplyScape, indicating that this likely will be the choice
for a national standard.