Blockchain’s “Royal Seal”—Blocking Counterfeit Meds

The Drug Supply Chain Security Act (DSCSA) enacted by the U.S. Congress requires the industry to adopt an “interoperable system” to manage records of ownership and prescription drug transfers in the United States. The MediLedger project aims to leverage blockchain to demonstrate compliance with the system—enabling manufacturers, wholesale distributors, hospitals, and pharmacies to register, verify, and transfer pharmaceutical products with trust in their authenticity and provenance.

The project is a joint venture between Chronicled and LinkLab to demonstrate a way to keep counterfeit medicines from entering the supply chain. The U.S. doesn’t have a centralized, country-wide database; stakeholders track their serialized items via individualized inventory management approaches. The MediLedger goal is to ensure that every time an asset is registered, verified, or transferred, a distributed network of blockchain validation “nodes” will come to “consensus”—making it tougher for the bad guys to fabricate or tamper with the event logs. This would lead to increased regulatory transparency and consumer safety, and further advance the utility of blockchain in the biopharmaceutical industry.

The project principals said the approach they are taking is more secure than typical centralized databases, which they characterized as more susceptible to hacking, and possible additions or deletions by individuals with administrator access. Chronicled CEO Ryan Orr draws a medieval analogy, comparing them to castles protected by moats. “You can fortify them as much as you want, but a hacker will always find a clever way to sneak inside the castle,” he said. “Blockchain introduces a whole new paradigm—it’s a distributed network, data is cryptographically secured, a breach in one node has no affect on the whole, and the consensus mechanism prevents malicious actors from tampering the system. That’s one of the things that’s really revolutionary about this technology.”

Chronicled is a technology company that uses blockchain and IOT as the underpinning for supply chain solutions; LinkLab is a supply chain consulting group that provides life science companies with guidance and support to meet global serialization regulations. Their team extended its own collaboration to form a working group of pharmaceutical industry leaders that include Genentech—a member of the Roche Group, Pfizer, AmerisourceBergen, and McKesson Corporation.

To date, the group has defined the industry requirements for the blockchain pilot for a prototype and an industry operating model. It stated that it has built a prototype for the registration and verification of medicines on the blockchain while keeping all business information private from other participants. The next stage will focus on developing business models and operating requirements.

Supply Management reported that, with MediLedger, only original manufacturers will be permitted to assign barcodes to drugs and initiate a new supply chain. Susan Summerville, founder and principal at LinkLab, describes this as a “royal seal” of authenticity. She told the publication that, “Every transfer afterwards effectively goes back and references, ‘Did this come from the original manufacturer?,’ and if the answer is ‘Yes,’ then they’ll bring that verification forward with them, that royal seal.”

John Martin

John Martin writes about technology, business, science, and general-interest topics. A former U.S. correspondent for The Economist (Science & Technology), he writes for the private sector, universities, and media, and can be reached at jm@jmagency.com.

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