Despite astounding technological advancements over the past century, Pharmaceutical Supply chain has a lot of potential for improvement. The Pharmaceutical Supply chain has many well-recognized and documented serious epidemics affecting the complex chain. The manufacturers of Pharmaceuticals along with uncountable trusted third-party have managed the complex multi-continental supply chain as efficiently as possible. But the mammoth task of securing and optimizing the pharmaceutical supply chain hasn’t been achieved with full potential.
For making the Pharmaceutical Supply chain more transparent, efficient and trackable we need a technology that can maintain effective collaboration and harmonization with multiple distribution partners and regulatory agencies. The technology must be capable of handling logistical complexities of Pharmaceutical supply chain operations along with eliminating the loopholes of fragmented, centralized data systems. Blockchain adoption in the Pharmaceutical Supply chain holds significant promise to advance the digital strength through its inherent traceability and immutability.
Issues to deal with in Pharmaceutical Supply Chain
There have been many reports documenting the grave issues affecting the Pharmaceutical supply chain. These serious epidemics directly impact the patients and hamper the reputation of the pharmaceutical industry along with impacting the economy. A report by the World Health Organisation ( WHO) states that about 100,000 people lose their lives every year due to counterfeit medicine in Africa alone. The report also estimates that 10% of medicine worldwide is counterfeit and rises to 30% in emerging regions. United Nations Office on Drugs and Crime (UNODC) estimates that 50% of the medicines bought over the internet are fake.
The economic losses caused by counterfeit medicines and other issues are equally disheartening. The European Union Intellectual Property Office (EUIPO) estimates the loss of €10.2B annually and loss of 90,000 direct and indirect jobs to manufacturers as a result of counterfeit medicine. In addition to the present security gap in the Pharmaceutical supply chain, the industry definitely lacks clear visibility into its inventory.
For decades, various institutions have formulated innumerable policies to address Pharmaceutical supply chain security problems. But in the present data sharing economy, policies alone cannot effectively combat the challenges that are the by-product of legacy platforms. The effective way to secure and optimize the operation of the Pharmaceutical supply chain is through the adoption of emerging technologies like Blockchain and IOT. Blockchain Technology is a subset of DLTs that provides a decentralized platform that distributes and verifies shared data with trusted partners in a secure and tamper-proof environment.
Blockchain: A promising technology to serve the Pharmaceutical supply chain
Blockchain can be the next tool capable of revolutionizing the future of Pharmaceutical supply chain. With the increasing complexity of Pharmaceutical supply chain, the need is to re-enforce compliance with regulatory bodies into the mix of pharma companies, manufacturers, trading partners, pharmacies, and patients. The adoption of Blockchain into the pharmaceutical industry would enable serialization, tracking and tracing products, also, mitigating the risk of loss or counterfeiting of pharmaceutical products.
Smart contracts (computerized software protocol), are the most alluring feature of Blockchain technology, that enable autonomous development, execution, and enforcement of contracts. The transformative application would allow parties that are the members of the platform, to transfer payment, information, and assets across geographical locations with minimal human interference. Along with this, the contract would be open source, consensus-based, timestamped chain to which, the cost and time effective features of Blockchain would be added.
The Pharmaceutical supply chain managers need better visibility into the wholesalers’ inventory to create an efficient product flow and enjoy steady financial gains. Blockchain adoption in Pharmaceutical Supply chain would be capable of forecasting demand and preparing inventories by serialized tracking. The technology is ideal to comply with the serialization guidelines in the US FDA’s 2013 Drug Supply Chain Security Act (DSCSA).
Blockchain adoption in Pharmaceutical Supply chain would also be an efficient solution for cumbersome clinical trial management. With advancements in drug manufacturing and research, many biotech companies are coming up with biologic drugs derived from different biological origins. Blockchain can act as a decentralized digital ledger to identify and validate the sources of thousands of biologic drugs, before getting these biologics to market.
For the patients taking part in the clinical studies, getting real-time updates on the outcomes is important. Blockchain adoption in Pharmaceutical Supply chain would allow the creation of a decentralized platform that has greater visibility throughout the clinical study for managing all of the clinical studies and their outcomes.
State of Blockchain Adoption in Pharmaceutical Supply Chain
A study administered and managed by Ipsos, a globally respected market and opinion research specialist, and sponsored by the IEEE-SA in October 2017, locate the state of Blockchain adoption in Pharmaceutical Supply chain. About 300 respondents equally represented the key trading partners on the supply chain—31% manufacturers, 34% wholesaler, and 35% dispensaries (i.e. retail pharmacy or health facility) participated in the study.
The results of the study were quite welcoming of Blockchain adoption in Pharmaceutical Supply chain. The majority of respondents were already exploring the use of Blockchain in their supply chain operations. Some of them were exploring Proof of Concepts (POC), and about one in five was a pilot study. The study stated that the more a respondent was familiar with Blockchain technology, the more value their company found in utilizing the technology.
Conversely, the lesser a respondent knew about Blockchain technology, the less he/she considered investing/ participating in the adoption of Blockchain in Pharmaceutical Supply chain.
The study indicated that the barriers to Blockchain adoption in Pharmaceutical Supply chain are the uncertainties of compliance with the FDA. When utilizing Blockchain, factors like the visibility of the data, and trusting the partner’s ability to view company information in an autonomous system affected Blockchain adoption.
From the industry stakeholders such as manufacturers, wholesaler, and dispensaries, manufacturers showed the greatest propensity to progress to the next step of implementation of Blockchain technology.
Long-term Vision for Blockchain adoption in Pharmaceutical Supply chain
Only the future holds the answer to whether Blockchain would be able to reach its full potential and revolutionize the Pharmaceutical Supply chain. The truth is that Blockchain technology is adaptable and infiltrating at a steady pace into several industries including Pharmaceutical world. But the need to advance the adoption of Blockchain technology in the Pharmaceutical supply chain can be attained by doing certain things. These include educating companies on Blockchain, developing technical standards, evaluating the technology platform and exploring whether a business case is practical or not.