State licensing compliance involves more than keeping track of expiration dates. It also involves protecting the sensitive information behind every license application and renewal.
Cybersecurity has become a critical consideration for companies across the pharmaceutical and life sciences industries. Sophisticated cyberattacks, phishing scams, credential theft, ransomware, and other threats continue to put sensitive business and personal information at risk.
For pharmaceutical companies managing dozens or even hundreds of state licenses, there is another cybersecurity question that deserves attention: How secure is the company you trust to manage your state pharmaceutical licenses?
It is a question that can be easy to overlook. A pharmaceutical manufacturer, distributor, or compounding facility may spend significant time evaluating its own cybersecurity controls, vendor security requirements, and compliance practices. But what happens when sensitive information is shared with a third-party pharmaceutical license management provider?
That is where the security of your service provider becomes part of your risk profile.
State License Applications Contain Highly Sensitive Information
Obtaining and maintaining pharmaceutical licenses is not simply an administrative exercise. Depending on the state, license type, applicant, and regulatory requirements, state license applications and renewals can involve a significant amount of sensitive company and individual information.
This may include business ownership information, facility details, addresses, responsible individuals, professional credentials, personal identifying information, corporate documentation, financial information, regulatory records, and other information required by state licensing authorities.
For pharmaceutical manufacturers, distributors, and pharmacies operating across multiple jurisdictions, that information may be submitted repeatedly as part of multi-state pharmaceutical licensing and license renewal management. In other words, the information involved in state license compliance can be transmitted multiple times across the license management lifecycle.
If that information is being collected, stored, transmitted, or accessed by a third-party service provider, companies should understand how that provider protects it.
Federal guidance reinforces the importance of understanding where sensitive information resides, who has access to it, and what vulnerabilities may exist. HHS, for example, identifies risk analysis as a foundational component of protecting sensitive electronic information and specifically notes that organizations should consider external sources, including vendors and consultants that create, receive, maintain, or transmit information.
The Cybersecurity Risk Does Not Stop at Your Own Network
Companies often invest heavily in protecting their own networks, systems, employees, and data. Firewalls, multi-factor authentication, endpoint protection, encryption, employee training, and access controls have become important components of modern cybersecurity programs.
But cybersecurity does not end at the edge of your organization. Every third-party provider that receives sensitive information creates another point that needs to be considered.
This is particularly important when selecting a pharmaceutical license management company. A provider may have access to information that your organization would never want exposed, yet cybersecurity capabilities can vary significantly between service providers.
A provider’s ability to manage state licenses efficiently is important. So is its ability to protect the information entrusted to it.
That means pharmaceutical companies should ask questions that go beyond:
- How many states can you manage?
- How quickly can you process a renewal?
- Do you monitor license expirations?
- Do you have a license management portal?
They should also be asking:
- Where is our information stored?
- Who can access it?
- How is access controlled?
- Is our information encrypted?
- How are employee devices protected?
- Does the provider use multi-factor authentication?
- What security standards and controls are in place?
- Are employees permitted to access sensitive information from unsecured environments?
- How does the provider protect against unauthorized access?
These questions should be part of the vendor evaluation process, not an afterthought.
The Remote Workforce Creates Another Layer of Risk
Remote and hybrid work have fundamentally changed how businesses operate. They have also changed the environment in which sensitive information may be accessed.
NIST has specifically addressed the security challenges associated with telework and remote access, noting that remote technologies can introduce security risks involving external networks, devices, and access to an organization’s non-public resources.
A remote employee may be working from a home office, shared workspace, hotel, airport, or other location outside the organization’s controlled environment. Even when a company provides secure technology, the physical and network environment surrounding that technology may introduce additional variables.
That does not mean remote work is inherently insecure. Organizations can implement strong controls for remote environments. However, it does mean that companies handling sensitive information need to understand how those controls work.
For a pharmaceutical company outsourcing state license management, this is an important consideration.
If a service provider’s employees are accessing confidential license applications, credentials, business records, and personal information from a variety of locations, what safeguards are in place to protect that information? The answer should be clear.
Cybercriminals Are Not Only Targeting Large Enterprises
One of the biggest misconceptions about cybersecurity is that only large corporations are attractive targets.
Cybercriminals are looking for access to valuable information, credentials, systems, and networks. Automated attacks, phishing campaigns, social engineering, malware, and credential-based attacks can target organizations of virtually any size. And a third-party provider can become an attractive target because it may have access to information from multiple companies.
For a pharmaceutical license management provider, that makes cybersecurity especially important.
A successful attack against a service provider could potentially expose information belonging to numerous clients at once. The question is therefore not simply whether your own organization has strong cybersecurity. It is whether the organizations you trust with your information do as well.
What Should Pharmaceutical Companies Look for in a Licensing Provider?
When evaluating a provider for pharmaceutical license management, state license compliance, or license renewal management, cybersecurity should be considered alongside experience, technology, service, and regulatory expertise.
Here are several questions worth asking:
- Does the provider operate in a controlled environment?
Ask where employees perform their work and how access to sensitive information is controlled.
- Is multi-factor authentication required?
Passwords alone are not enough to protect sensitive systems. Multi-factor authentication adds another layer of protection by requiring additional verification before access is granted.
- Is sensitive information encrypted?
Companies should understand how information is protected both when it is stored and when it is transmitted.
- How is network access protected?
Firewalls, network encryption, intrusion protections, and other controls can help reduce the risk of unauthorized access.
- Does the provider control employee access?
Strict access controls can help ensure that employees only have access to the systems and information necessary to perform their responsibilities.
- How are employee devices protected?
Endpoint security is an important component of protecting the computers and other devices that interact with sensitive systems and information.
- What security standards or compliance frameworks does the provider use?
A provider should be able to clearly explain the security standards, controls, and technologies it relies upon to protect client information.
Security Should Be Part of Your Compliance Strategy
For pharmaceutical manufacturers, distributors, and compounding pharmacies, regulatory compliance is already a complex responsibility. Managing state pharmaceutical licenses, monitoring expiration dates, completing renewals, addressing deficiencies, and maintaining compliance across multiple jurisdictions requires detailed information and consistent oversight.
But compliance also depends on trust.
When your company provides sensitive information to a third-party pharmaceutical compliance or license management provider, you are trusting that provider to protect it. That makes cybersecurity part of the vendor selection process.
The right question is not simply, “Can this company manage our licenses?”
It is: “Can this company manage our licenses while protecting the information we are entrusting to them?”
How SLS Protects Client Information
At State License Servicing, we recognize that pharmaceutical license management involves handling sensitive information that our clients expect us to protect.
That is why security is built into the way we operate.
Unlike many organizations that have adopted fully remote work models, SLS does not permit employees to work remotely. Our employees work within our secured office environment, providing an additional layer of physical and operational control over how client information is accessed and handled.
SLS also utilizes security measures designed to protect client information and systems, including:
- ISO 27001/SOC 2 Compliant Platforms
- Multi-Factor Authentication (MFA)
- Data Encryption
- Network Encryption
- SSL & Firewall Protections
- Strict Access Control
- Endpoint Security
Our approach reflects a simple principle: protecting our clients’ information is an essential part of protecting our clients.
For pharmaceutical manufacturers, distributors, compounding pharmacies, and other organizations managing complex state licensing portfolios, choosing a licensing partner means choosing a company you can trust with more than your renewal dates.
Before you select your next pharmaceutical license management provider, ask the question: How secure is the company you are trusting with your information?
To learn more about how SLS can help manage your state license portfolio, contact the SLS team today.