Pharma and Blockchain : a real revolution
Will Blockchain affect Pharma industry?
India being the largest provider of generic drugs globally, has a lots of documentation and supplies overall. Indian pharmaceutical sector industry supplies over 50 per cent of global demand for various vaccines. 40 per cent of generic demand in the US and 25 per cent of all medicine in UK. India enjoys an important position in the global pharmaceuticals sector. The country also has a large pool of scientists and engineers who have the potential to steer the industry ahead to an even higher level. Presently over 80 per cent of the antiretroviral drugs used globally to combat AIDS (Acquired Immune Deficiency Syndrome) are supplied by Indian pharmaceutical firms.
To keep this position Indian government is also doing its needful. The Union Cabinet has given its nod for the amendment of the existing Foreign Direct Investment (FDI) policy in the pharmaceutical sector in order to allow FDI up to 100 per cent under the automatic route for manufacturing of medical devices subject to certain conditions. The drugs and pharmaceuticals sector attracted cumulative FDI inflows worth US$ 15.83 billion between April 2000 and June 2018, according to data released by the Department of Industrial Policy and Promotion (DIPP).
Medicine spending in future:
Medicine spending in India is expected to increase at 9-12 per cent CAGR between 2018-22 to US$ 26-30 billion, driven by increasing consumer spending, rapid urbanisation, and raising healthcare insurance among others. Going forward, better growth in domestic sales would also depend on the ability of companies to align their product portfolio towards chronic therapies for diseases such as such as cardiovascular, anti-diabetes, anti-depressants and anti-cancers that are on the rise. The Indian government has taken many steps to reduce costs and bring down healthcare expenses. Speedy introduction of generic drugs into the market has remained in focus and is expected to benefit the Indian pharmaceutical companies. In addition, the thrust on rural health programmes, lifesaving drugs and preventive vaccines also augurs well for the pharmaceutical companies.
How will Blockchain revolutionize Pharma?
All this can take a rigorous speed with the help of Blockchain technology. Blockchain in itself is quickly increasing in interest and has received praise for its far-reaching applications, mainly because of its recent expansion into industries ranging from financial services to energy suppliers and pharmaceutical companies. It is a growing technology that originated with the advent of Bitcoin and has steadily filtered into an increasing number of other profitable markets. In its simplest form, blockchain is software that provides a digital ledger system for records and log transactions, by grouping them into chronologically-ordered blocks. These blocks are linked and secured using the latest cryptography technology.
Digital ledgers have been around for years, but it’s the associated features that are built into blockchain that make it such a necessary addition to any complex logistical operation. Its main security feature is that the database is evenly distributed across a network of multiple computers, leaving no centralised points of entry that could be targeted by hackers. Another particular advantage is the system’s transparency once blockchain in integrated into the supply chain network. All users are able to see real-time transactions and revisions to blockchains and, once the data is entered into the system, it requires retrograde action on all associated blocks to make any edits, preventing human error and other fraudulent activities.
Blockchain holds great potential as a unified solution for efficient and secure management of pharmaceutical supply chains around the globe. Its uniquely distributed network would enable the development of complete end-to-end supply chain management for every company and product. By allowing multiple stakeholders to participate in distributing the network, it creates an incredibly secure database, without the patchwork configuration of previous supply chain technologies.
One of the key issues of pharmaceutical manufacturing supply chains is the incredible number of incompatible computer systems providing virtually no visibility into end-consumer sales for manufacturers and increasing the number of manual tasks with no user satisfaction. Some of the problems that arise from this complex situation could be avoided easily with blockchain by providing real-time access to data and visibility across the entire pharmaceutical supply chain, from the ingredient supplier’s product codes to the pharmacies dispensing prescriptions to patients. Suppliers are currently working without a decentralised ledger, creating a large hole in the infrastructure, and little-to-no security for its participants.
Pharmaceutical companies and pharmacy retailers are also involved in marketing alliances involving rebates and coupons that deflate the value of the product in order to boost exposure and that provide an unclear picture of how many drugs are on the market. Another huge financial burden in the manufacturing supply chain is the thousands of third-party companies that are paid handsomely to provide research on the movement of pharmaceuticals. This enormous expense could be drastically lowered with a blockchain-based tracking system.
Also, there is a problem of safety. The main issues with drug safety in the pharmaceutical supply chain are to do with how the drugs are initially manufactured. The traceability of active pharmaceutical ingredients during actual manufacture is a difficult process, so detecting drugs that do not contain the intended active ingredients can ultimately lead to end-consumer patient harm or even death. The number of deaths related to these issues has been increasing in recent years. Blockchain’s advanced features make it capable of providing a basis for complete trace-ability of drugs, from manufacturer to end consumer, and the ability to identify exactly where the supply chain breaks down during an issue.