PharmaceuticalsPractical applications of blockchain in Pharmaceuticals
Blockchain is quickly increasing in interest and has received praise for its far-reaching applications, mainly because of its recent expansion into industries ranging from financial services to energy suppliers and pharmaceutical companies. It is a growing technology that originated with the advent of Bitcoin and has steadily filtered into an increasing number of other profitable markets.
In its simplest form, blockchain is software that provides a digital ledger system for records and log transactions, by grouping them into chronologically-ordered blocks. These blocks are linked and secured using the latest cryptography technology.
Digital ledgers have been around for years, but it’s the associated features that are built into blockchain that make it such a necessary addition to any complex logistical operation. Its main security feature is that the database is evenly distributed across a network of multiple computers, leaving no centralised points of entry that could be targeted by hackers. Another particular advantage is the system’s transparency once blockchain in integrated into the supply chain network. All users are able to see real-time transactions and revisions to blockchains and, once the data is entered into the system, it requires retrograde action on all associated blocks to make any edits, preventing human error and other fraudulent activities.
Blockchain holds great potential as a unified solution for efficient and secure management of pharmaceutical supply chains around the globe. Its uniquely distributed network would enable the development of complete end-to-end supply chain management for every company and product. By allowing multiple stakeholders to participate in distributing the network, it creates an incredibly secure database, without the patchwork configuration of previous supply chain technologies.
Some of the most important features of blockchain in pharma have yet to be fully developed and realised in the industry:
The manufacturing supply chain – a logistics nightmare
One of the key issues of pharmaceutical manufacturing supply chains is the incredible number of incompatible computer systems providing virtually no visibility into end-consumer sales for manufacturers. Some of the problems that arise from this complex situation could be avoided easily with blockchain by providing real-time access to data and visibility across the entire pharmaceutical supply chain, from the ingredient supplier’s product codes to the pharmacies dispensing prescriptions to patients.
Suppliers are currently working without a decentralised ledger, creating a large hole in the infrastructure, and little-to-no security for its participants. Pharmaceutical companies and pharmacy retailers are also involved in marketing alliances involving rebates and coupons that deflate the value of the product in order to boost exposure and that provide an unclear picture of how many drugs are on the market.
Another huge financial burden in the manufacturing supply chain is the thousands of third-party companies that are paid handsomely to provide research on the movement of pharmaceuticals. This enormous expense could be drastically lowered with a blockchain-based tracking system.
Drug safety – how drugs are manufactured
The main issues with drug safety in the pharmaceutical supply chain are to do with how the drugs are initially manufactured. The traceability of active pharmaceutical ingredients during actual manufacture is a difficult process, so detecting drugs that do not contain the intended active ingredients can ultimately lead to end-consumer patient harm or even death.
The number of deaths related to these issues has been increasing in recent years. Blockchain’s advanced features make it capable of providing a basis for complete traceability of drugs, from manufacturer to end consumer, and the ability to identify exactly where the supply chain breaks down during an issue.
Despite the efforts of supply chain managers, preparing inventories based on demand for pharmaceuticals can be a difficult task without proper visibility into the supply chain. A blockchain-based system would enable manufacturers to efficiently manage inventory levels to prepare for spikes in demand.
With better visibility into the inventory of wholesalers, the manufacturers would be able to manage their inventory levels for a shorter overall hold period, thus creating an efficient flow of product and steady financial gains. As companies and inventories grow, these serialised tracking and tracing features of blockchain technology will steadily become a necessity for pharmaceutical organisations.
Public safety and consumer awareness
There are many public safety issues where blockchain can improve the efficiency of delivering a safe and effective medicine to end-consumer patients. With blockchain making real-time data available at the push of a button, pharmacies and other retailers can improve their internal and external inventories by tracking product movement from in-store and in-transit information.
Blockchain can fill in the gaps in pharmaceutical supply chains globally, mitigating their direct impact on the overall population. It’s important to provide a strong foundation of trustworthiness and safe practices for all patients and the community as a whole. Blockchain integrates these values by generating informative, real-time responses to events potentially impacting patient health, such as life-saving prescription medication debuts and product recalls.
Recall management is another issue that blockchain can solve by better managing the process of informing the public of these types of important announcement. Up to one million people are killed each year worldwide as a result of these types of errors, and better tracking through the supply chain would have a significant effect on the current pharmaceutical supply chain model.
Clinical trial management
There are a number of use cases for integrating blockchain into the clinical trials management process. However, two stand out for their significant potential. The first is the supply chain of large molecules. More biotech companies are developing large molecule medicines from various points of origin, creating an immense need for a digital ledger in order to identify and validate the various points along the path to a final product for market.
Another important use case involves providing patients with proper clinical kit management practices, for patient safety and to provide accurate results from patient studies. Managing all of these studies and complex data requires a secure, decentralised ledger.
We are just beginning to see the benefits of blockchain in the pharmaceutical supply chain industry and its positive effects on suppliers, clinicians, and on to the public. With so many initiatives being launched in pharma for blockchain, it could easily surpass the financial industry with the number of cases generated.
As we are still learning and exploring all of the benefits and opportunities of blockchain, it is important to keep in mind the end result – a happy and healthy patient.