Blockchain powered Supply chain in Healthcare

A significant and well notable ultimatum to the pharmaceutical supply chain is the infiltration of the compound category of substandard and falsified medicines; these are also mentioned to as counterfeit medicine; these are also mentioned to as counterfeit medicines but often taking on a contrasting legal denotations. Collectively, these different kinds of weakened and fake medicines can manifest as a result of importing substandard drugs without local consent, deficient manufacturing practices or improper storage, theft and diversion of drugs and the infiltration of weak quality or fake products into grey markets. The World Health Organisation estimates this combined market at $75 billion/year but approximates range up to $200 billion. The pharmaceutical supply chain and healthcare system are particularly susceptible to disruption in countries like Vietnam where the vast majority (90%) of drug expenditures are contingent upon imported sources.

Blockchain technology is coming up, and it may solve many of the challenge’s providers experience in healthcare today. But where exactly will it be effective and what use cases should organizations be looking to as they move ahead?

Though the pharmaceutical industry is actively exploring the blockchain technology to help with several real-world use cases. Many of these explorations already have proof-of-concept implementations that have generated tractable interests in the Pharma industry.

Verifying the Authenticity of Returned Drugs:

In the Pharma industry, drugs are frequently returned to the pharmaceutical manufacturers. For instance, wholesalers may have ordered excess inventory and accordingly may need to return unsold stock to the pharmaceutical manufactures.

While the proportion of the returned drugs is small compared to the sales (about 2–3% of sales), the per year volume is in the range of $7- 10 billion.

Instead of destroying these perfectly good drug shipments, pharmaceutical companies instead opt to re-sell them. However, before they can re-sell these returned drugs, the pharmaceutical companies have a legal obligation to verify the authenticity of the returned drugs.

In the US, the Drug Supply Chain Security Act (DSCSA) stipulates that all US manufacturers must implement serialization or barcoding of drugs at a package level by November 2018.Also, by the same time next year these serial numbers must be used to verify the authenticity of the returned drugs.

Europe has a similar regulatory enactment called the Falsified Medicine Directive (FMD), requiring all drugs to be serialized or barcoded by February 2019.

While the EU has opted for a centralized approach (allowing manufacturers to upload serial numbers to a centralized EU regulator’s database, and distributors to connect to this centralized database to verify drug authenticity), in the US there is no centralized database regulator.

Without such a centralized database, one option is for every distributor to integrate data with every pharmaceutical manufacturer, which is logistically prohibitive!

A far better and recommended approach is to have pharmaceutical manufacturers record the serial numbers of their packages on a blockchain, which serves as a decentralized and distributed ledger. Wholesalers and customers can then verify the authenticity of a drug package by connecting to the blockchain

SAP launched first kind of Supply chain module Proof of Concept in Q3 2017, and a second one in early 2018. The PoC for the Use case works as following

· SAP’s existing solution (unrelated to blockchain) called ATTP (Advanced Track and Trace for Pharmaceuticals), generates unique identifiers for a drug package.

· When a manufacturer ships a package they register the item on the SAP Pharma POC blockchain, with the four pieces of information generated by the ATTP; the item number (based on GS1 standard), a serial number, a batch number, and an expiration date.

· The distributor can extract the four pieces information from the packaging’s barcode, using a simple scanner mobile app, allowing them to verify returns.

· Counterfeiter copies of barcodes can be avoided, since SAP has the added ability to track every time a package changes hands. A map view within the mobile app also helps ensure that the drugs are in the expected geographical region.

Prevention of counterfeit drugs and medical devices:

Blockchain’s ability to establish provenance of data makes it especially suited for this supply chain use case

Drug companies that manufacture, ship and deliver products have a difficult time keeping track of their products, thereby allowing counterfeiters to introduce fake drugs into the system

The problem of counterfeiting is not just limited to drug manufactures but extends to medical instruments manufactures. The world Health Organisation estimates that 8 % of the medical devices in circulation today are counterfeit copies

Counterfeit drugs and medical devices pose a major risk to consumers, and lost revenue for the legitimate manufacturers

When the Drug Supply chain security Act mandate goes into effect by November 2018 every drug package will be uniquely serialised or barcoded. This will provide a unique product identifier for each drug package and allow the verification of the authenticity of every product solid.

As the drug moves through the supply chain the transactions can be recorded on a blockchain, thereby providing a distributed provenance ledger. This will make it possible for all parties to track drugs through the entire supply chain life cycle.

This will make it harder for counterfeit drugs from being introduced into the supply chain and distributed to unsuspecting consumers.

Compliance in Pharma supply chain

As drugs move through the supply chain, logistics companies need to adhere to drug handling, transport and storage guidelines. Several operating constraints may need to be tracked. These may include maintaining temperature range, humidity, air quality within specified limits etc.

Environmental conditions within the supply chain may have a direct impact on the quality and efficacy of the drug. For example, temperature sensitive products like vaccines need to be properly monitored throughout the supply chain.

Today drugs are monitored throughout the supply chain using smart IoT devices and temperature, humidity and other factors can be recorded using smart devices throughout the supply chain life-cycle.

However, since each participant of the supply chain i.e. the manufacturer, the logistics company, the stores and the pharmacies etc, maintain their own separate ledger, a problem within any particular segment of the supply chain is difficult to track.

Blockchain technology provides the pharmaceutical supply chain a better way to add compliance and governance within the supply chain.

Due to its inherent transparency, immutability and distributed nature, Blockchain technology provides a mechanism that allows any participant in the supply chain to ensure that the supply chain logistics and transportation guidelines (including handling and storage conditions of the drugs), were adhered to.

Additionally, smart contracts can be programmed that automatically execute when compliance conditions are not met, there by alerting the relevant parties in the supply chain.

So, for example suppose, if there is a temperature excursion during a transportation, with blockchain technology the consumer can easily see at what point the event occurred. Additionally, smart contracts may be automatically invoked within the blockchain, which will reduce the invoice amount due to the logistics company, based on its level of non-compliance of storage conditions

Transparency and traceability of consent in Clinical Trials

Informed patient consent involves making the patient aware of each step in the Clinical Trial process including any possible risks posed by the study. Clinical trial consent for protocols and their revisions need to be transparent for patients and traceable for stakeholders.

However, in practice the informed consent process is difficult to handle in a rigorous and satisfactory way.

The FDA reports that almost 10% of the trials they monitor feature some issues related to consent collection. These include failure to obtain written informed consent, unapproved forms, invalid consent document, failure to re-consent to a revised protocol and missing Institutional Review Board approval to protocol changes, among others. Frequently also there are reported cases of document fraud such as issues of backdating consent documents.

Blockchain protocols in clinical trials can provide transparency and traceability of consent.

Blockchains provide a mechanism for unfalsifiable timestamping of consent forms, storing and tracking the consent in a secure, and publicly verifiable way, and enabling the sharing of this information in real time. Additionally, smart contract can be bound to protocol revisions, such that any change in the clinical trials protocol requires the patient consent needing renewal.

Improving the quality and reliability of Clinical Trials data

Since the passage of the Prescription Drug User Fee Act in 1992 (which allowed the FDA to receive funding from pharmaceutical companies), the FDA has collected $7.67 billion in user fees from pharmaceutical manufacturers. This trend of annual funding to the FDA from drug manufacturers is expected to continue to increase.

Patients and physicians have begun to question the current standards for Clinical Trial funding, leading to growing concerns due to the conflict of interest and the high stakes involved.

Blockchain with its decentralized, immutable ledger and a mechanism to ensure transparency provides a solution.

Clinical trials data can be stored in a secure, unfalsifiable and publicly verifiable manner on the blockchain. This prevents tampering with clinical trials results, thus improving the reliability of the clinical trials data.

Blockchain technology can also be used to directly increase the quantity and quality of patients recruited for clinical trials in a number of ways.

Using blockchain individual patients can store and control access to their medical data, and make it visible to trial recruiters, who could then reach out to the patients if their data qualifies for the clinical trial. The decentralized nature of blockchain gives to the patients, control over their data, and consent and its revocation.

What It Takes to Implement Blockchain in Healthcare

With these examples in mind, how should healthcare stakeholders begin implementing blockchain? The use of the tech needs to be part of an overall technology strategy, also “Companies shouldn’t just have a hammer — blockchain — and be in search of a nail. They should give ample thought to the motivation behind an implementation”.

A good place to start might be to ask what the “smallest, clearest case for a blockchain” might be for a company, then work from there. And when piloting the technology, it’s critically important to think about the ecosystem in which it will function and consider regulations, infrastructure and other stakeholders along the way.

“The introduction of blockchain technology into the healthcare industry won’t occur overnight, nor will many of its benefits be immediately realizable. Rather, major transformations begin with small steps,”