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Uses of Blockchain in the Pharmaceutical industry

Updated: Aug 11

As blockchain takes on various industries like a storm, Gabriel Micallef examines some of its practical applications in the pharma industry.



Blockchain in the Pharmaceutical industry
Blockchain: a growing list of records, called blocks, which are linked using cryptography

Let’s face it, the global #pharmaceutical industry doesn’t have the reputation of being fast-moving and is usually on the conservative end of the industry spectrum. Highly regulated and traditionally resistant to change one would expect it to be hard for blockchain to have any impact. Although #blockchain is usually associated with crypto yet the underlying technology it brings has many uses in traditional industries.


What exactly is blockchain and how does it work?

A blockchain is a distributed virtual ledger in which transactions are processed, validated and recorded. New transactions are bundled into ‘blocks’ which are added to the chain using cryptography.

Critically, the job of validating and maintaining the ledger is distributed across different ‘nodes’ that each hold a copy of the overall ledger, making it more or less impossible to corrupt or hack part of the system.

This ‘strength in numbers’ approach enables secure and transparent processing of transactions, without the cost or inefficiency of relying on a third party. All users are able to see real-time transactions and revisions to blockchains. 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 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.


Regulatory Submissions

One of the most cumbersome processes in the pharmaceutical industry is the vast amount of resource needed for regulatory submissions both from the Regulators and the Pharmaceutical industry. An integrated system where dossiers are stored and reviewed online in a database using blockchain technology would simplify the current system and reduce the administrative burden from both sides. This would make regulators easily see what has been changed and reduces the need from the industry to have repositories of finished dossiers and document granules. Editing and review could be done real time onto the same dossier thus being more efficient.

As we moved from paper submissions to Non-eCTD electronic submission (NeeS) to electronic Common Technical Data (eCTD) over the years, this would be the next leap forward.


Manufacturing supply chain

One of the main problems in 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.

One of the biggest and most important uses for Distributed Ledger Technology (DLT) in future will be in supply chain management.

Projects in the global pharmaceutical industry, perhaps uniquely, involve the distribution and supply of a plethora of products across multiple countries and jurisdictions, with important considerations of safety, security and data protections in play at every step of the way.

Digital ledgers are already being developed that can be used to track each stage of the supply chain at both the level of the individual drug and for products as a whole, enabling manufacturers to eliminate counterfeiting and other types of fraudulent activity.


Pharmacovigilance

An other use of blockchain would be in the vast network of ADR reports and ASPRs collected on a regular base from all companies throughout the EU into the Eudravigilance system. The current structure would benefit from a decentralised ledger system making it easier to avoid human error and simplify the process.


Drug safety & recalls

The main issues with drug safety in the pharmaceutical supply chain are to do with how the drugs are initially manufactured. 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.The link between manufacturer, wholesaler, pharmacy and even patient can be joined with an integrated system of where this product moves. This would mean that recalls can be managed much smoother and faster rather than relying on present techniques of locating batches.

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. With the new Falsified Medicines Directive (FMD) coming in place by 9th February 2019 the need for increased identification of pharmaceutical products provides blockchain an other opportunity to ensure drug safety.


Quality Agreements

Blockchain could be used to power QTAs as they could allow multiple parties to enter into an agreement where there is potential for miscommunication and mistrust with more confidence. Smart contracts are stored with all parties at the same time, and all copies are updated simultaneously when a change is made by one party.


Inventory management

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.


Clinical trials

The emphasis on the security afforded by blockchain is key to its use in the management of clinical trials, where the confidentiality of patient information, and the integrity of trial data, are of paramount concern.

One possible use for DLT in this context is to create and store unique identities for trial enrollees, preventing patients from participating in multiple studies simultaneously.

By being able to securely share information on the blockchain across investigations, pharmaceutical companies will be able to access up-to-date information on trial progress and facilitate new modes of collaboration.

By unlocking the potential for multiple sites to work together on problems, DLT offers hope that the timeline for clinical development could be shortened.


As former Teva chief executive Yitzhak Peterburg forecast, pharma, one of the last “traditional” industries, may be about to undergo “huge disruption” from tech innovations of this kind.

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.


A brighter future ahead?

As with all new technologies, the introduction of #DLT will take time and patience as different players begin to realize its potential.

While much of the effects will be felt behind the scenes, there is now little doubt that blockchain will have real and noticeable impact on the ability of pharmaceutical companies to innovate, collaborate, and ultimately to get their products into hospitals and pharmacies.

With patients, physicians and politicians all calling for lower costs, greater efficiency and better outcomes, progress can’t come a moment too soon.


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