Blockchain Could Tackle New Pharmaceutical Industry Requirements - But Huge Challenges Loom

A sweeping US law pertaining to pharmaceuticals tracking and accounting, which will require stricter tracking of drugs’ provenance from production to distribution, might be a perfect fit as a blockchain application, say health care analysts. This law, the “DSCSA”, will come fully into effect in a few years, and has sent the pharma industry scrambling for solutions for its implementation

Bob Celeste, pharma-compliance veteran and founder of the Center for Supply Chain Studies, reckons blockchain to be “an attractive solution to supporting DSCSA-compliance efforts”. His Center is spearheading pilot projects to test the feasibility of DSCSA on the blockchain.

Yet others question the possibility of successfully meeting DSCSA targets with or without blockchain implementation, pointing to the complexity of the task and the surfeit of different blockchain projects all “trying to win the whole [protocol] pie” for themselves.

A Huge Challenge

The law, entitled the Drug Supply Chain Security Act, was passed in 2013 and requires full implementation by 2023. It is a massive piece of legislation, comprising “a global mandate, requiring any company wishing to sell a pharmaceutical product in the U.S. to facilitate product ‘traceability’”.

Traceability is meant to entail a full fluency between manufacturers, distributors, logistics providers, pharmacies and hospitals regarding the identity and history of products, such that:

a consumer should be able to pick up a bottle at a pharmacy and see all the hands that touched it prior to the point of sale

There are grave concerns in the industry about implementing these requirements on time, such that enforcement of some of the new standards have been delayed by the FDA. Celeste, however, seems optimistic about the prospect of pharma-blockchain integration. Speaking of the first iteration of his pilot project, he reported that “[w]e gained incredibly valuable data and insight from the simulated Reference Models we developed in phase 1”.

The delayed enforcements go into effect in late November of this year, those concerning the placement of identifying labels on individual packages of product. We should then have more clarity on the state of implementation, both on- and off-chain.