Blockchain technology, which safely and securely records valuable data, has emerged as a solution for transparently tracking complex supply chains. However, many experts are doubtful that pharma—generally a conservative and tightly regulated industry—will implement or benefit from this technology.
Experts say the pharma industry has a low appetite for investment in blockchain, particularly given the more promising supply chain tracking alternatives, such as radio frequency identification (RFID). Meanwhile, pharma supply chains are already tightly regulated, so the industry cannot benefit from blockchain the way other industries might.
“Blockchain is a big buzzword, but it’s not necessarily the answer in biomedicine supply chains,” says Dr. Atul Butte, chief data scientist at University of California Health. “There are a lot of other proposed solutions out there.”
Can blockchain offer supply chain advantages?
Blockchain is a tool for digital record-keeping, where each piece of data added to the blockchain ledger is transparent and secure, explains Chi-Ren Shyu, director of the University of Missouri Institute for Data Science and Informatics. All entries on a blockchain are immutable, making it impossible to retroactively manipulate data after it is recorded, he adds.
In drug supply chains, blockchain could guarantee the trustworthiness of all data recorded on each step of the supply chain, from the raw materials sourced to the doses at a trial site, Shyu says. However, it is not necessarily clear that trustworthiness is a major concern in pharma supply chains in the first place, he notes.
Countries with major drug markets have tight regulations, so blockchain’s immutability does not provide a major trust advantage, Butte adds. In addition, the transparency of blockchain is not necessarily an advantage in the clinical trials sector, he notes. Details of drug supply chains, including sensitive patient data such as whether a drug is an active treatment or placebo, should still be secured in private databases, he explains.
Pharma slow to adopt
Even if blockchain did significantly improve the trustworthiness of drug traceability, there are major questions over whether pharma would trust the new technology, Shyu says. Pharma is conservative about adopting new technologies, particularly when there are few use cases in other industries, he notes.
If blockchain does see widespread implementation, pharma would be among the last industries to adopt, notes GlobalData Analyst George Monaghan. “Skepticism of blockchain is high at the moment,” he adds. GlobalData is the parent company of Clinical Trials Arena.
According to a 2022 GlobalData survey, which recorded responses from 114 pharma executives, only 6% reported prioritising investment in blockchain. Meanwhile, 51% of executives reported prioritising investment in artificial intelligence (AI), 39% in real-world evidence (RWE), and 18% in the Internet of Things (IoT).
Nevertheless, the uptake expectation for blockchain has risen in the past year, Monaghan notes. In 2022, 21% of pharma executives said they could use blockchain in the next two years, up from just 13% in 2021, according to the GlobalData survey.
Alternative solutions to blockchain
Despite the skepticism surrounding blockchain, pharma could require changes to supply chain verification to meet stricter new regulatory demands. In November 2023, the FDA’s Drug Supply Chain Security Act will fully take effect, requiring unit-level tracing for all drugs dosed to patients.
As one alternative to blockchain in pharma supply chains, drug manufacturers could broadly implement RFID, Butte notes. RFID uses radio waves to track individual drugs, materials, and shipments with much greater precision than barcodes, allowing sensors to efficiently scan hundreds of individual units simultaneously. Meanwhile, there is also research into adding quick response (QR) codes to pills to promote greater drug traceability, Butte adds.
Blockchain does not solve the problem of who owns the clinical trial data management system, Butte explains. As a result, private secure databases, coupled with more precise tracking mechanisms, may still be pharma’s best option, he says.
The future of blockchain?
Beyond drug supply chains, there is also some interest in blockchain as a tool for recording clinical trial data. The industry-wide push towards decentralizing clinical trials has raised concerns over patient control of data, and some companies are promoting blockchain as a tool for giving patients more control over their data.
As for supply chains, the COVID-19 pandemic has made the need to improve and digitise pharmaceutical supply chains clear. However, at least for now, many industry experts do not expect blockchain to lead the charge.
“My eyes are wide open to possible changes,” Butte says. “I just don’t see any strong use cases where blockchain could improve biomedicine supply chains more effectively than the alternatives.”
- Blockchain is a digital record-keeping system that is secure, transparent, and immutable, possibly improving trustworthiness in clinical trial supply chains.
- However, many experts are skeptical that pharma is ready to invest and sees added benefits in an already regulated industry.
- Pharma is a conservative industry, and biotechs have not prioritised investment in blockchain above other emerging big data technologies.
- Experts expect pharma to further digitise supply chain tracking, but most likely through less risky alternatives such as RFID traceability.
More on clinical trials supply chain: Sustainable supply chains: clinical trials in a new era of limited resources.