When one reads about blockchain technology, it’s unlikely that terms like medicine, health, and the pharmaceutical industry immediately come to mind. Discussions about this disruptive technology often focus on investment, capital, or delve into the technical knowledge involved (standards, ERC, tokens, peer-to-peer, etc.). However, this technology, its developments, and the innovations built upon it are key to solving problems in various economic sectors, including healthcare and pharmaceuticals. In these areas, blockchain’s secure new method of record-keeping positions it as a “natural” remedy for several issues.
Two main challenges in the pharmaceutical healthcare sector align particularly well with blockchain technology.
Fighting Counterfeit Pharmaceuticals
First, the problem of counterfeiting in the supply chain of the pharmaceutical sector presents a significant risk to user safety. This issue arises not only when products move along the supply chain but also during online transactions in digital markets. The root of the problem lies in the centralized architecture of existing systems, where tracking responsibilities are passed from one stakeholder to the next without comprehensive control or mutual oversight among all involved. Moreover, the differing interests of parties in the production and distribution process, along with their reluctance to share separately stored traceability data, exacerbate the issue.
This lack of trust among stakeholders and the single, ever-changing points of failure—first at the producer, then the distributor, and finally the end-user—make the system vulnerable to tampering and counterfeiting, posing public health risks. The data speaks for itself: the percentage of counterfeit drugs has risen drastically, reaching up to 30% in developing countries, leading to thousands of poisoning incidents and treatment failures. Clearly, the system requires an “end-to-end” solution capable of tracking products throughout the supply chain.
Counterfeiting Fight with NFTs
Counterfeiting prevention is made possible by incorporating IoT and blockchain technologies, particularly through Non-Fungible Tokens (NFTs). Initially introduced in the art and collectibles world, NFTs, due to their characteristics, are ideal for tracking digital versions of both physical and non-physical data with a unique identity. NFTs can represent a digital twin of the product.
The proposal is to establish a system where manufacturers create NFTs representing drug batches, capturing their attributes and metadata throughout their lifecycle—from production to distribution, handling, and final use. This would allow every handover to verify the product details, including full custody, current owner, location, shipping conditions, certifications, and more.
This concept, which includes strict protocols for authenticating drug sources, could revolutionize pharmaceutical manufacturing and distribution, potentially eliminating counterfeiting. It would establish an infallible drug supply chain, ensure drug source credibility, enable ownership transfer, and create a decentralized system for accessing up-to-date supply chain information with details securely stored on blockchain.
Potential Revolution in R&D
Blockchain technology also addresses another crucial, though less visible, pharmaceutical issue: the possible revolution in drug research and development. Currently, characterized by closed and isolated institutional contexts, blockchain and its associated technologies are poised to open up a new scenario, reintroducing collaboration in innovation—long the foundation for tackling significant challenges. The hope is for a shift in the R&D sector from fragmented entities to one guided by the integration of internal knowledge and capabilities.
The challenge of prior art—where intellectual property holders keep all potentially patentable information secret due to the lack of practical ways to determine who first invented something—could be addressed by blockchain. Combining the benefits of smart contracts and NFTs embedded in a blockchain with traditional licensing schemes, a platform could be developed to record pharmacological discoveries immutably. This would allow evaluation of whether a chemical molecule is new or not, ensuring that researchers who first upload their discoveries receive due credit without hindering the sharing of critical data.
The Future is Here
In conclusion, even the pharmaceutical healthcare sector is experiencing an era of potential revolutions that could resolve significant challenges. As William Gibson once said, “the future is already here.” All that’s left is to have the courage to leap forward, abandon outdated models, and embrace the new paths marked by technological progress.
Bibliography
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Guardian, T. 10% of drugs in poor countries are fake, says WHO, 2017, available at: https://www.theguardian.com/global-development/2017/nov/28/10-of-drugs-in-poorcountries-are-fake-says-who
MOHAMMADI, S., FATOORCHI, A. A., & BABAGOLI, M., NFT-based online prescription for data management in healthcare service, in Technology Analysis & Strategic Management, 20223, 1–14. Available at: https://doi.org/10.1080/09537325.2023.2209209
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