SPOTLITE360 TECHNOLOGIES, INC. is pleased to announce the Company has launched an initiative to offer tailored supply chain tracing and tracking solutions for organizations in the pharmaceutical industry, for which it is presently in contract negotiations with pharmaceutical firms. This initiative aligns with an impending U.S. regulatory change in the USD $1.3 trillion pharmaceutical industry1 requiring companies to comply with the Drug Supply Chain Security Act (“DSCSA”), which mandates the implementation of electronic tracing measures. The Company has identified an opportunity to deliver solutions geared towards compliance with the DSCSA using RFID and IoT (“Internet of Things”) sensors in conjunction with blockchain, machine learning, and enterprise tracking software licensed from TrackX Holdings Inc. (“TrackX”).
“The Drug Quality and Security Act (DQSA), was enacted by Congress on November 27, 2013. Title II of DQSA, the Drug Supply Chain Security Act (DSCSA), outlines steps to build an electronic, interoperable system to identify and trace certain prescription drugs as they are distributed in the United States. This will enhance FDA’s ability to help protect consumers from exposure to drugs that may be counterfeit, stolen, contaminated, or otherwise harmful. The system will also improve detection and removal of potentially dangerous drugs from the drug supply chain to protect U.S. consumers.”
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Excerpt from the Food and Drug Administration webpage introducing the DSCSA and its objectives
In addition to the burden of compliance with new and emerging regulations such as the DSCSA, pharmaceutical industry players face other persisting challenges in their supply chains to include the following:
- Approximately USD $200 billion worth of counterfeit drugs are sold annually worldwide2
- Pharmaceutical cargo theft amounts to more than USD $1 billion per year, with the median theft value of USD $100,000 being above average compared to other industries3
- Deficient storage and transportation practices (e.g., unrefrigerated vehicles, shipping times exceeding a drug’s shelf life) can cause damage to pharmaceuticals, identified as a multi-billion dollar problem in a 2018 study4
Empowered by the Spotlite360 technologies tailored to clients in the pharmaceutical industry, the Company’s existing SaaS solution will be able to capture real-time and event-driven data which can identify inefficiencies and possible hazards for pharmaceutical firms, thus potentially mitigating issues such as those listed above. Further, by providing proof of origin, reliably authenticating goods, and allowing for visibility into the chain of custody, potential benefits to clients in the pharmaceutical industry include accountability of global suppliers, as well as validation of claims relating to environmental, social, and corporate governance (“ESG”) matters.
Blockchain technology has already proven successful in various functions of pharmaceutical supply chains, including compliance with DSCSA. In 2020, a major technology firm published a study of its blockchain pilot program in collaboration with pharmaceutical giant Merck & Co. and the U.S. Food and Drug Administration (“FDA”), which was deemed initially feasible as detailed in its final report submitted to the FDA5. By offering an enhanced value proposition through comprehensive visibility and tracking capabilities, Spotlite360 seeks to create new industry standards with its latest initiative for the pharmaceutical industry.
Spotlite360 President James Greenwell commented, “There are numerous risk factors that make the pharmaceutical supply chain perhaps the most complex of all. Firms are under immense pressure to have oversight of the chain of custody to ascertain the origin and provenance of all ingredients and authentication of the finished product right up to the moment it reaches the patient. Lack of visibility into each step along the supply chain leaves drugs susceptible to fraud through counterfeiting, theft, and damage of all kinds (e.g., puncturing of containers, spoilage from storage at improper temperatures). Moreover, expectations for environmental, social, and governance (“ESG”) standards of corporations are higher than ever as enterprise technologies become more sophisticated and provide the tools to make sustainable and socially conscious business decisions. The Spotlite360 technology platform can offer significant value to the pharmaceutical industry and consumer by leveraging blockchain technology and machine learning to provide event-driven tracing and tracking, as well as proof of sustainability.”
RSU Grant
The Company also reports that it has issued 700,000 restricted shares units of the Company (“RSUs”) under the Company’s restricted share unit plan (the “RSU Plan”) to the President of the Company, as compensation and an incentive for the President to drive the growth of the Company. The RSUs and the RSU Plan remain subject to shareholder approval and ratification at the next annual general and special meeting of shareholders, scheduled for August 30, 2021. An initial 70,000 RSUs will vest on the date of shareholder approval, and the remaining six (6) tranches of 105,000 RSUs per tranche will vest every six (6) months over a period of 36 months from June 15, 2021. Once vested, each RSU shall entitle the holder to acquire one common share of the Company underlying each such RSU by delivering a notice of acquisition to the Company in accordance with the RSU Plan for a period of 5 years. In accordance with the RSU Plan, the RSUs were priced at CDN $0.90 based on the closing price of the common shares on the Canadian Securities Exchange on July 5, 2021.
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Engagement of Marketing Services
The company further announces that it has engaged JBN Partners, LLC (“JBN”) to increase public awareness of and interest in the Company, its management and its products by coordinating certain investor relations and corporate financial public relations with members of the investment community, the financial media and the public, in general. The services agreement with JBN has a three-month term with a total payment value of USD$50,000.
The Company has also engaged Think Ink Marketing Data and Email Services (“Think Ink”) to provide and manage a public relations campaign for the Company, to increase public awareness of the Company and its products, services, and securities. In connection with Think Ink’s engagement, the Company has entered into a six-month public relations services agreement with Think Ink with a total payment value of USD$50,000.