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Blockchain in the Pharmaceutical and Life Sciences Industry

Blockchain in the Pharmaceutical and Life Sciences Industry

Blockchain and Distributed ledger technology-based projects are appearing in every industry. A research report carried out by Deloitte on GitHub, shows that around 86,000 projects (9,375 carried out by companies and research institutions) are in development with a reported growth of 8,603 projects a year.

Within the Pharma Industry in particular, studies carried out by the Pistoia Alliance show that 22% of pharmaceutical and life sciences companies are currently using or trying out blockchain technologies and that 83% believe that blockchain-based technologies will be adopted within five years. More than two thirds (68%) of these companies believe that blockchain technologies would have a strong impact in industry, primarily based on the following two applications: supporting the supply chain by ensuring an auditable trail to safeguard drug and medical device provenance or using blockchain technology to store medical records.

Supply chain provenance is part of a larger and more significant problem in the pharmaceutical industry: Counterfeit drugs. Research by the World Health Organisation in 2017 found that an approximate 1 in 10 medical products, whether it be pharmaceuticals or medical devices circulating in low and middle-income countries, were either below standards or falsified.
In collaboration with 15 companies in the Life Sciences Industry, SAP Software solutions created the SAP Pharma Blockchain POC (Proof of Concept) to combat this problem. The application is based on SAP’s Advanced Track and Trace for Pharmaceuticals and runs on Android and iOS devices. Using data stored in the manufactures’ blockchain, the application can track drugs by serial number, batch and expiration date in real time, allowing anyone from brand owner to end consumer to identify and authenticate drugs by scanning a unique serial number which is embedded in the barcode.
As of January 30th, 2019, Merck, the world’s oldest running pharmaceutical firm, was awarded a blockchain patent that describes a technology that identifies and records unique features of physical objects including chemical signatures as parts of its unique identifier or ‘fingerprints’. The company aims to use this technology in a similar fashion as SAP did to narrow down on counterfeit drugs by increasing supply chain security.
With the cryptocurrency hype cycle coming to an end, it is high time that blockchain as a technology is seen not as just a foundation for cryptocurrencies but as a technology that has the potential to change most industries. As with every emerging technology, a steep learning curve is involved. However, as exemplified in the aforementioned projects, industrial collaboration allows for the technology to provide a strong foundation for solutions to complex large-scale problems.

Matthew De Giorgio is an analyst with Deloitte Digital Malta. For more information, please visit 

What is Blockchain?

In the simplest of terms, a blockchain is a form of distributed ledger technology (DLT). A distributed ledger is a database that is shared across several networks of computer devices or nodes, a concept that already exists today. But, in the case of a blockchain, once a record has been added to the chain (the database, in loose terms) it is impossible to alter or delete data, since new blocks can only be added to end of the chain.

Unique to blockchain, the records are grouped together into blocks and added to the chain one after the other. Each block contains two codes called hashes. Hashes are created using a hash algorithm, which turns arbitrarily-large amounts of data into a fixed-length hash, comprised of a sequence of 64 alpha-numeric characters (which translates to 256 bits). It may seem impossible that a near infinite amount of data can be translated consistently into a unique string of only 64 characters, but this is miraculously how cryptographic functions work. The first hash is unique to that block whilst the second hash is from the previous block in the chain. Once the block is added to the chain, the hash codes connect the blocks together in a specific order. Blockchain’s structure is well suited for processing transactions, tracing assets and recording events.

Key potential blockchain use cases:

Medical records and interoperability. A patient’s medical history that is spread across providers, payers, etc., could be centralised in a blockchain, where the patient has visibility and control over their medical record. Providers, patients, insurers could see the relevant health information needed for enhanced patient care and experience.

Prescription sharing. A patient could provide consent to have personal prescriptions tracked and operated on the blockchain to improve transparency and data validation.

Patient wearables. A connected device that broadcasts patient information could offer a real-time, scalable solution for monitoring and treating patient outcomes.

Supply chain. Blockchain supply chain recording could begin at the manufacturer, undergo updates by intermediaries, and be authenticated by the buyer.

Clinical trials. The tracking and reporting of results could be directed to a blockchain to improve the efficiency of drug development.

Provider credentialing. Credentialing organisations could accrue data to the blockchain ledger and make it available to other organisations, potentially expediting the provider credentialing process.

Value-based care. Tracking a patient’s episode of care and related medical events on a blockchain could be used to determine quality of care over time.

Discounts, rebates, and refund tracking. Blockchain could be used to help clear and settle transactions between drug manufacturers and intermediaries to track financial rebates and other incentives tied to drugs.

Study protocol management. The complete history of changes could be immutably tracked through blockchain to enforce controls and streamline adherence.

Adverse events. A blockchain solution could enable an incubation group of companies to securely share adverse events data, permissioned such that only contributing members could view others’ data.

Consent management. A blockchain solution could manage and track informed consent across multiple sites, systems, and protocols. The consent and use could be tracked forward in research.