How Blockchain Is Improving Compliance And Traceability In Pharmaceutical Supply Chains

For such a large and closely monitored industry, big pharma still struggles quite a bit with quality control.

One of the core challenges of the industry is the assurance of the chemical composition of the drugs themselves. From manufacturing errors to complex supply chain processes, there are a number of things that can impact why a drug is either ill-made, spoils in a shipment, or entirely counterfeit.

They’re trusting that the drug that was delivered is what it promises to be — and that’s not always the case.

But what’s concerning is when a patient goes to the hospital, they’re putting their trust in the physician or pharmacist that is prescribing or providing that specific drug, and the physician or pharmacist themselves aren’t even completely sure where the drugs are coming from. They’re trusting that the drug that was delivered is what it promises to be — and that’s not always the case.

Now, that’s not to say this is what happens the majority of the time, but the fact that it happens at all is an issue worth thinking about. It’s one of our primary projects here at Chronicled, to assess how pharmaceutical supply chains can be improved, specifically through the use of blockchain technology.

As it stands, almost every party involved in the shipping process of a given drug struggles to know exactly where a specific shipment comes from. They’re trusting that the party in the chain one level before them performed all their duties appropriately, and the products were not switched or mishandled before they reached the distributor. The manufacturing side is no different. There may be ingredient sourcing from a country using fillers, replacing the original approved chemical — which could lead to an allergic reaction to a consumer.

A more recognizable and earlier example of this same sort of challenge was in the 80s, when patients were receiving blood from HIV-positive patients. Hospitals held blood drives, the bags were then quickly marked and shipped off, and even though they were re-tested in a lab before being administered to patients, there was still a lot of room for error.

Today, we’re seeing this happen with more specialized treatments such as gene therapy. Patients have to provide samples of their DNA (or stem cells are withdrawn) and then the drug is created specifically for that individual patient. But throughout that entire process, samples have to move from the patient to the drug manufacturing facility, and then from the facility back to the hospital, where it is stored and finally administered.

With that many steps, manually checked, there are plenty of opportunities for mix-ups.

Even right now, although there are only a handful of treatments utilizing this specific case-by-case approach, in the next five to ten years that number will increase exponentially. So whatever amount of risk is being experienced now will only continue to build, meaning more and more personal data will need to be stored and analyzed appropriately. The systems we have in place currently will no longer be sufficient to stand up against the very real life-or-death scenarios that accompany these risky procedures.

That’s where blockchain comes in.

Here’s an example:

Let’s say a pharmaceutical company is making personalized medicine. What this may mean is that they are extracting white blood cells from a patient, shipping the white blood cells to the lab, creating a special medicinal cocktail just for the client, and then sending the personalized medicine back to the client.

Now, three things can go wrong with this process. One, the lab sample can get mixed up and the wrong white blood cells are used for the creation of the cocktail. Two, the personalized medicines are mixed up and Mary is shipped Bob’s personalized medicine. Or, three, the patient can get sick for some unknown reason and claim it was because they received the wrong personalized medicine and the pharma company now must prove to the contrary.

In all three cases, the problem can be avoided if there is a strong record of chain of custody of the shipment in both directions.

Chronicled offers a product — the CryptoSeal — making it possible to secure the samples from the lab with a cryptographic identity similar to the chip in your credit card and a destructible tamperproof form factor that prevents moving a chip and seal from one vial to another. The mobile App is used to register the identity in the CryptoSeal to the blockchain, and, then, the same mobile app can be used at the other end of the chain to verify the shipment has been received by the lab or the patient or the doctor. The record keeping on blockchain is permanent in case there is ever a need to prove the record keeping.

The advantage of blockchain over a central database is that a central database has a systems administrator who can edit, modify, delete, or alter records if the stakes are high enough — which is not the case with a blockchain. With the blockchain the records are permanent and can not ever be changed.

This is what we mean by secure transfer of custody. We are excited to bring this secure, decentralized, transfer of custody technology to the mainstream pharma, forensic evidence, fine art, automotive, and other sectors over the coming years.