BLOCKCHAIN ISSUE
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TECHRACERS
In the present context of a health-conscious ecosystem, keeping a vigil on pharma supply chains have become more challenging as it involves the life-saving interest of a human being. Moreover, it requires the participation of different stakeholders such as pharmaceutical
manufacturers, wholesalers, distributors, customers, information service providers, and regulatory agencies. Managing the operational challenges of working and interacting with huge numbers of associates and business partners are critical components to drug production and quality assurance.
The global pharma industry has invested several billion dollars in hardware and software to comply with the Drug Supply Chain Security Act (DSCSA) and related efforts to secure the pharma supply chain around the world. DSCSA outlines steps to build an electronic, interoperable system to identify and trace certain prescription drugs as they are distributed in the United States. Even though the act was passed in November 2013, it will continue to be one of the most talked-about points in the pharma industry until the implementation completes in
2023. Keeping DSCSA regulations in considerations, all pharmaceutical companies will consider some quality confirmation procedures between the formation of a drug and its circulation to the customer, however, the thoroughness of these QA procedures differs relying upon the idea of
the business and the product. Edible goods, pharmaceuticals, logistics, and so on— tend to have more thorough QA procedures contrasted with industries that are most likely to deliver the results of the minimal outcome.
These regulations stipulate that the delivery of each package of medicinal products to the consumer must be traceable. The blockchain is perhaps the right fit for these requirements as it offers transparency, traceability, immutability, and trust. The blockchain will give an interesting
advanced memory of the drug along with the other factors associated with, incorporating the materials utilized underway and all the quality, plan and printing process information.
Drug Lifecycle In Blockchain Network – Production To Consumption
As the drug goes through four phases of the clinical trial, blockchain innovation and its security engineering can confirm each information and yield from every one of the phases of clinical trials. The advancement to the next stage depends on whether it meets the required benchmarks or drug viability, proficiency, item determination, substance detail and other
expected outcomes.
As per the DSCSA of 2013 which makes package-level identification mandatory, FDA has extended the time limit to Nov 26, 2018, which gives a lot of time to pharma industries to meet the program requirements on time. However, many contract manufacturers believe that there
is a need for information technology systems that are able to handle the tracking of data. Blockchain here can prove to be a long-sought interoperable electronic system.
When a drug gets approved by regulators, the stipulated royalties associated with it can be triggered by using smart contracts. All the stakeholders in the network get the much-needed room to validate the clinical trial results and hence monitor the drug specifications to make
sure that they are precise. As a result, we will get transactions that are cryptographically verifiable with proof of agreement from various network participants and they will see only the parts of the ledger that are relevant to them, and that transactions carried out are legitimate and secure.
The blockchain will solve major problems for the pharmaceutical industry:
Serialization Of Drugs
With as many as 50% of drugs being sold online are counterfeit and 1 in 10 medical products in low GDP nations are falsified, there is a sincere need for drug serialization.
As per the January 2015 guideline by DSCSA, manufacturers must print lot numbers on the packaging of all prescription drugs, in order to exchange 3T documents (Transaction Information, Transaction History, And A Transaction Statement) at each phase of drug lifecycle.
Blockchain here can be an ultimate solution to drug serialization. Each item of medicine is attached with an unambiguous identification tag, which allows for virtual and physical ownership to be transferred from the upstream suppliers to the downstream consumers. The barcode-tagged drugs are scanned and entered into secure digital blocks whenever they change hands. This ongoing real-time record could be viewed anytime by authorized parties and even
patients at the far end of the supply chain.
Only trusted, verified parties would be granted permission to add information to the blockchain’s record. All activity would be transparently shown in real time, without the lengthy delays often associated with legacy tracking software. At any given point, a quick scan of the product could pull up a full history of that product’s path along the supply chain. Any anomalies or lapses in supply chain integrity would be easily detected.
A blockchain-powered supply chain would include functionality for drug identification and verification and would have the power to notify all relevant stakeholders whenever an illegitimate drug was found in the system or an unauthorized edit was made to the record.
Under such a system, medications could be seamlessly transferred through a network of trusted parties – a network that is both transparent and totally secure.
● In the event that a drug shipment is disrupted or goes missing, the data stored on the common ledger provides a rapid way for all parties to trace it, and determine who handled the shipment last
● The public availability of the ledger would make it possible to trace every drug product all the way back to the origin of the raw material used to make it.
● The decentralized structure of the ledger would make it impossible for any one party to hold ownership of the ledger and manipulate the data to their own advantage.
This representation could be utilized to fundamentally increase profitability and final product quality. It would likewise significantly diminish the costs associated with maintenance, upkeep and reuse purposes. Each serial number has a hash and is stored in the blockchain, every time a batch reaches the next destination a smart contract gets activated and upon verification goes further. Critically, it will hold data on the drug’s possession, provenance, authenticity, price tag and the currency being utilized.
The majority of this data can be ensured with crypto-conditions that permit different store network accomplices to check the credibility and security of a message. The computerized drug memory would fill in as the advanced portrayal of the physical world and would contain a full "story" depicting each physical item fabricated and exchanged.
Drug Recall
It takes 10-17 years to bring a drug to market successfully. The loss to a pharma company due to a single drug recall is colossal. According to the Tufts Center for the Study of Drug Development, the average cost to develop and gain approval of a new drug is $2.558 billion. Drug recalls not only result in financial loss for the producing company, but they also cause damage to the company’s reputation. For pharmaceutical companies, the cost of the actual recall is not even the costliest aspect of recalls.
“A sum total of 2028 drugs were recalled in 2015, followed by 1224 drugs in 2016 and 272 drugs have been recalled so far 2017 - FDA
Mislabeling and Failed Specifications are perhaps the major reasons behind drug recalls for major pharma companies. We believe that use of blockchain across the pharma supply chain can mitigate the number of inefficient and faulty drugs reaching the market, making the drug
development process more trustworthy and error-free, ultimately reducing the drug recall numbers.
Multiple parties involved in the pharma supply chain log their data into a common blockchain. The manufacturers log the details for each batch such as date and time. Now, whenever a batch of drugs is roped, the blockchain will emit events for presumed scenarios such as contamination, mislabeling, or manufacturing defects. This will likewise allow the people in the blockchain network to take appropriate action thereby minimizing the risk of a drug recall.
Pharmaceutical Cold chain Monitoring
Cold chain inefficiencies in a pharma supply chain network are magnanimous.
As claimed by a survey conducted by the IBM Institute for Business Value, the cold chain breaks are responsible for the loss of 15% to 25% of purchased doses. For H1N1 alone, cold chain breaks had the potential to cause the loss of $60-$100 million.
Blockchain will address the major loopholes in cold chain monitoring such as room temperature shipments, tamper-evident installation, and regulatory standards. When aligned with the IoT, it will supervise the major threats such as Solar Radiations, Ambient Temperature Extremes,
Physical Hazards, Harmful Gases & Vapors along with Drug Theft & Counterfeiting. Moreover, all the third-party companies (cold-chain management and logistics), that are responsible for the movement of pharmaceuticals, can be effectively be replaced by a blockchain-based
tracking system where the manufacturer, as well as consumer, can keep a vigil. This will likewise reduce the overheads for larger corporations and small pharmacies in the ecosystem and guide businesses towards ethical practice.
An IoT temperature sensor is enabled in all the pharma shipments, once the shipment reaches the destination all the data is transferred to blockchain and a smart contract is activated as compared to the actual requirements and composition. Accordingly, a smart contract is either
completed and shipped to the next destination or transferred back to the supplier.
Transparency And Privacy In Pharma Distribution
The pharmaceutical industry needs to undergo titanic changes as it has experienced a lot of challenges when it comes to Research and Development productivity and access to regulatory environments. A transparent record keeping will help these small retailers and distributors to get loan, financing options quickly.
Blockchain can help in overcoming supply chain inefficiencies. It enables the dichotomy of privacy and transparency to coexist. If the critical drug information is stored on a permissioned ledger, it would be protected from the external world and made available only to the trusted parties.
The distributed ledger technology of blockchain enables all manufacturing sites to have the replica of critical drug information required to abide by the FDI guidelines. There is no need to manually extract the data from a traditional database system. The information is available in real-time, in a consistent and recurring format. It preserves the brand image and the labeling is regular across all the manufacturing sites, worldwide.
By making use of blockchain, the pharma companies can possess, control and offer their information effectively and safely without risking a violation of their privacy. Such a structure can enhance the efficiency of legacy pharmaceutical data accumulation by giving every single
comparing party access to the correct information they require while keeping persistent information private in the meantime. This will execute cross-industry business rules prevent business intelligence and private data related to a drug or clinical trial tests, and likewise ensure fidelity across supply chains. This will enable small distributors and retailers for a quicker payment cycle and quick access to funds. At present, a small retailer has to wait for 2-3 months to get a payment from hospitals after delivery of the medicines.
Initiatives - Scalability
Pretty much the biggest issue standing in front of mass adoption of the technology - blockchains cannot support the addition of more than a few hundred transactions per second. Because of this problem, the scale needed to, say, manage thousands of millions of drug units is beyond the reach of current blockchain technology. For instance, Bitcoin supports only about 10 transactions per second and one of the solutions by a huge enterprise claims to have 3500 transactions per seconds.
A pharma company would need to label thousands of drug the units at a time. For such a use case we need faster transaction speeds. Our research wing at Techracers is specifically taking on this issue. We already have a prototype running that is capable of doing thousands of transactions per second - and the numbers keep increasing each day.
End Note
The blockchain can establish a vibrant, open development environment and unlock innovative solutions whilst keeping up with the compliance regulations as well as paving new ways to partner inside a shared supply chain ecosystem. It can effectively address the areas of vulnerability in the pharma supply chain as it advocates for the best practices for preventing and keeping a track of authorized and uncompromised drugs before they reach consumers.
About the author
Ankur Maheshwari is the co-founder and CEO of Techracers, technology leaders in providing innovative end-to-end blockchain solutions and services. He has been leading the development of multiple products and frameworks on blockchain that is focused on scalability and accelerating the production enterprise adoption.
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