MediLedger, Chronicled and blockchain

The MediLedger Project aims to demonstrate compliance with the Drug Supply Chain Security Act (DSCSA). It utilises blockchain technology to track and trace prescription medicines. The project also seeks to demonstrate an ability to prevent counterfeit medicines from entering the supply chain.

“Our vision for an industrial blockchain ecosystem would have an open architecture, allowing a free, competitive market with appropriate governance,” said Chronicled executive Susanne Somerville. “The blockchain has the capability to bring trust and automation to the baseline business logic of the industry.  We are excited to be working with such a strong group of partners through the MediLedger Project.”

Based in San Francisco, Chronicled is a technology company leveraging blockchain and IoT to power smart, secure supply chain solutions. Chronicled secures IoT device identities, data and event logs. It automates IoT-dependent business logic through smart contracts. Chronicled is a founding member of the Trusted IoT Alliance where the mission is to create open source tools and standards with which to connect IoT and blockchain ecosystems

The problem MediLedger addresses

The DSCSA has a number of staggered effective dates. It requires the Pharma industry to adopt an ‘interoperable system’ to manage records of ownership and transfers of prescription drugs in the United States. Chronicled believes that blockchain may be the technology best suited to enable this interoperable system.

The unit-level serialization requirements of the Drug Supply Chain Safety Act (DSCSA) go into effect this year to improve drug security. But there is a lack controls to prevent counterfeits and protect patients.

Next year (2019) saleable returns requirements mean that pharma distributors will need to verify a returned product’s authenticity before they resale. (For a sense of scale, there are annually some 60M drug units returned by dispensers. Currently, there is no simple, fast way for the distributors to contact the manufacturer to verify the product.

By 2023 the law requires the tracking and tracing of all prescription drugs through the supply chain using an interoperable system. There is no defined interoperable system today.

In addition, the FDA is looking to industry to develop its own solution. Solutions do exist which satisfy today’s regulations – but they do not have interoperability.

The MediLedger Project

The MediLedger Project was established in 2017 to bring pharmaceutical manufacturers and wholesale distributors together to explore the potential of blockchain technology to track and trace prescription medicines. Its specific scope was to evaluate blockchain’s application to ensure compliance with DSCSA in the United States.

But it goes further. The benefits of the MediLedger system may well apply in other geographies where problems with counterfeit medicines and/or illicit trade exist.

Over the past several months, the MediLedger Project has evolved in its search for a blockchain-based system for tracking the legal change of ownership of prescription medicines. Its 2017 year-end report draws a number of conclusions:

1. The Project’s blockchain-based system appears to satisfy the requirements set forth by DSCSA and is capable of acting as the interoperable system for the pharmaceutical supply chain prescribed in the Act
2. The Project has proven that it can meet the data privacy requirements of the pharmaceutical industry itself; in particular, it can guarantee all supply chain handshake transactions posted to the blockchain are fully ‘hidden’ (ensuring that no business intelligence can leak). This enables nodes in the blockchain system to be hosted by numerous unique parties while both safeguarding sensitive transactions and ensuring the immutability of each supply chain handshake transaction.
3. The Project has proven its ability to verify the origin of serialized global trade identifiers (SGTINs) and to trace the provenance of drugs to their original manufacturers; since each transaction in the supply chain can reconfirm the integrity of a specific product, it is possible to prevent the movement of products without an authentic pedigree.

This functionality has the potential to expedite investigations and recalls, making illicit drug movement detectable and greatly strengthening safety capabilities in the industry.

Enterprise Times: what does this mean

In 2018 the MediLedger Project plans to continue to advance the concept with its implementation of a pharmaceutical blockchain ecosystem. The object is to ‘enable trust’.

MediLedger seeks to create a permissioned blockchain network. This will exploit open standards and specifications operated by pharma industry participants (and technology providers which serve the pharma industry). The participants will operate distributed nodes where no business intelligence is shared on the blockchain (sorry Facebook).

If achieved, this level of blockchain-based trust may prove relevant to multiple business scenarios – anything involving a ticket, for example. If the MediLedger Project succeeds in establishing a recognised pharma platform which meets the DSCSA obligations, the possibility exists that this can provide the basis for industries far removed from pharma.

This would be a major step forwards and MediLedger is not the only initiative. The true test will be take up and one aspect missing from the MediLedger Project report is any mention of participants beyond Chronicled (which initiated the Project).