Tracking prescription drugs via blockchain

Using blockchain, the US pharmaceutical industry plans to implement the Drug Supply Chain and Security Act (DSCSA), that requires that in 2023 a system must be in place that tracks legal changes of ownership of prescription drugs as they move through the supply chain.

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At the beginning of 2019, the FDA began accepting pilot project proposals to identify solutions for meeting the 2023 requirements of the Drug Supply Chain and Security Act (DSCSA). The US Congress passed the DSCSA to improve the security of the pharmaceutical supply chain to help eliminate counterfeit pharmaceuticals and enhance patient safety. In June 2019, the MediLedger Project, a working group of 24 industry leading pharmaceutical manufacturers, distributors, retail chains, logistics partners and solution providers, was accepted by the FDA as one of their approved proposals. 

The working group's purpose was to evaluate blockchain technology, like the MediLedger Network, in the track and trace of prescription medicines in the United States. The MediLedger Project released the MediLedger DSCSA Pilot Project Final Report detailing how and why blockchain can meet the 2023 DSCSA requirements for an interoperable, confidential change of ownership system in the US pharmaceutical supply chain.

The MediLedger DSCSA Pilot Project Final Report demonstrates that a well-designed, industry-led, decentralized blockchain platform can successfully meet the 2023 DSCSA requirements. Mack MacKenzie, Vice President of Digital Market Access and Revenue Management solutions at Pfizer said, "I am very encouraged by this demonstration of broad industry commitment to an interoperable system that achieves DSCSA compliance. It is exciting to imagine how we can build on this success to jointly deliver transformative digital services that add more value for patients."

The proposed solution is a combination of (a) business rules and standards that govern how data is shared and (b) a blockchain-based network capable of enforcing those standards. The core function of the network is to validate the authenticity of drug identifiers and the provenance of saleable units throughout the supply chain. This can all be done without any proprietary data being shared openly on the blockchain or ever leaving a company's control. Instead, proprietary data can be exchanged directly with necessary trading partners, and what is posted on the blockchain are cryptographic proofs, also known as zero knowledge proofs, of those exchanges that ensure they are valid and follow the business rules and data standards. This allows all trading partners to operate on the same up-to-date data and that all interactions throughout the supply chain are based on trust.

Matt Sample, Vice President of Manufacturing Operations at AmerisourceBergen said, "As we look to 2023, there's a lot of unknowns on what the 2023 interoperable system will be and what technologies will enable that system.  However, what we were able to demonstrate during the FDA MediLedger pilot was the power of a connected network of authorized trading partners, including those without direct business relationships. The use of blockchain enabled a shared "phone book" of authorized trading partners, locations, and connection points that enabled that network.  Whether blockchain is or is not part of the 2023 landscape, we hope this pilot at least demonstrated the viability of blockchain in the pharma industry and the industry can learn from the use cases evaluated."

Collaboration within the industry is key for the interoperability required in the DSCSA. David Vershure, Vice President Channel and Contract Management at Genentech said, "We are excited to see our industry working together to build a truly resilient system that is crucial for the future of patient safety. The current point-to-point systems infrastructure lacks the ability to keep data in-sync across the healthcare supply chain, which ultimately increases the risk of counterfeit, diverted or otherwise illegitimate products. The pilot serves as a key milestone in demonstrating that blockchain technology is a viable option to address the complexity of building an interoperable system needed for DSCSA 2023."

The MediLedger Network is a blockchain based network built by and for the pharmaceutical industry. MediLedger was selected by the working group due to its existing and growing adoption within the industry. MediLedger is already in commercial use for the verification of saleable drug returns and will expand in 2020 to include a solution to the contracting and chargebacks process in the pharmaceutical supply chain.

Chronicled, a technology company based in San Francisco, is the custodian of MediLedger providing administration of the network and development of solutions on top of the network. Susanne Somerville, CEO at Chronicled, said, "We are very pleased that companies across the industry joined Chronicled in the MediLedger FDA Pilot Project. We were able to show that a blockchain solution is feasible to meet the 2023 DSCSA requirements and are privileged to take part in making the US drug supply chain safer for patients."

To see the full MediLedger Project FDA Pilot Report go to https://www.mediledger.com/fda-pilot-project.

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