First applications of blockchain in healthcare will emerge in the supply chain, says GlobalData.
American pharma behemoth Merck has filed for a US patent for a blockchain-based system, which stores the location coordinates of objects and tracks them. For this reason, leading data and analytics company GlobalData believes that blockchain technology will prove an invaluable tool for confronting the rise of counterfeit drugs and the first applications of blockchain in healthcare will emerge in the supply chain.
Merck began to explore the applications of blockchain in 2016, when Associate Director of Product Management and Applied Technology at the pharmaceutical giant, Nishan Kulatilaka, speculated that after financial services ‘healthcare could potentially be the second-biggest industry to adopt blockchain technology’. The company claims that its blockchain-based system ensures that records are essentially immutable, and when employed in a supply chain, restricts the opportunity for fraudulent activities.
The Organisation for Economic Co-operation and Development’s (OECD) 2015 report highlighted the drastic need for improvements in supply chain security and accountability. According to it, counterfeit goods accounted for 2.5% of the global pharmaceutical trade in 2013 and global pharmaceutical sales reached $1.1 trillion in 2015. The OECD deduced that the counterfeit pharmaceutical industry is worth in the region of $200bn annually, which is only marginally less than the $246bn illicit drug trade.
Spencer Shaw, Healthcare Analyst at GlobalData, says:
“Beyond its potential use within supply chain security, blockchain is anticipated to provide a secure and convenient mechanism of data transfer between patients and healthcare providers.”
Recently, US retail giant Walmart was awarded a patent for a blockchain-based system for the storage of medical records retrieved from wearable healthcare devices. The system is said to allow medical professionals to access medical data from patients who are unable to communicate.
Shaw concludes: “Blockchain-based systems will begin to materialize in the healthcare industry in 2018. The primary obstacles to their implementation for data sharing within the healthcare industry are regulations concerning medical data and the prohibitive cost of setting up a common distributed network. For this reason, although in the long term blockchain will revolutionize many aspects of healthcare on the patient level, the first applications of blockchain in healthcare will emerge in the supply chain, which is less resistant to change.”