Areas of Current Investigation |  Background

Areas of Current Investigation

Several trends have taken the national spotlight recently. First, e-prescribing (the electronic generation and dissemination of scripts) has great potential for improving patient safety, quality, and cost of care. The Institute of Medicine's (IOM's) seminal report "To Err is Human" identified illegible prescriptions as a major factor in preventable morbidity and mortality within the United States.

The other trend is toward the use of bar coding technology to improve the safety of medication administration. A related technology is eMAR (electronic medication administration record), which accurately records drug administration information at the point of care.

One issue with NDCs is that they are ambiguous; many NDCs can exist for a single product, leading to inaccuracies in the dispensing of drugs. In an effort to help alleviate this problem, the National Library of Medicine (NLM) has been working on RxNorm, which provides "standard names for clinical drugs (active ingredient + strength + dose form) and for dose forms as administered to a patient."


The National Drug Codes (NDCs) are standards for reporting drugs and biological products. Originally established to serve as a critical part of an out-of-hospital drug reimbursement program under Medicare, they are now maintained by the Food and Drug Administration (FDA) and are used for many purposes, including reporting prescription drugs in pharmacy transactions, coding drug information within clinical information systems and for prescription drug claims processing. NDC numbers are also reported in the Physicians Desk Reference(PDR). The Drug Listing Act of 1972 requires that all drug-producing establishments report to the FDA all drugs "manufactured, prepared, propagated, compounded, or processed by it for commercial distribution." Only selected non-prescription drugs are included in the NDC database.

NDCs consist of a 10-digit number broken into three segments:

  • The labeler code - identifies the firm that produces, repackages, or distributes the drug
  • The product code - identifies the strength, dosage form, and formulation of the particular drug
  • The trade package size - identifies the size and type of the packaging in which the drug is sold or distributed 

An NDC will take one of three possible configurations: 4-4-2, 5-3-2, or 5-4-1. The product and package codes are assigned by the manufacturer. In some places, an asterisk may appear as a placeholder. HIPAA transactions require an 11-digit NDC, so a leading 0 may be placed in those circumstances.

Last Modified: September 2016