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Blockchain: A Solution for Improved Traceability with Reduced Counterfeits in Supply Chain of Drugs

Abstract

The pharmaceutical supply chain is one of the areas most prominently considered when developing technology-driven solutions and use cases. For example, the global market for fake, substandard, counterfeit, and grey market medicines accounts for up to $200 billion per year. Studies have uncovered a host of pharmaceutical products, medical devices, and biologics have been subject to counterfeiting the entire drug supply chain .Supply chain is susceptible to lots of pharmaceutical crime. Coupled with the international growth of the pharmaceutical market and a rise in global drug sales, the emergence of various forms of technology and digital health platforms has given rise to many supply chain solutions.In addition to pharmaceutical falsification, improving security and addressing vulnerabilities of the medical commodities is a priority area .Counterfeit drugs have been in the market for long and affect a lot of people negatively,solutions to address these have become inevitable .Our solution proposes to leverage blockchain technology to make supply chain of drugs transparent to increase trust among actors and provide security and authenticity by help of IoT.

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Keywords— BlockChain, IoT, Supply Chain, Pharmaceutical Supply chain, Drug Supply chain, Medicine Supply chain.

Introduction

Blockchain technology has been penetrating every aspect of Information and Communication Technology (ICT) and its use has been growing rapidly in recent years.

The purpose of this research is to assess the implication of blockchain technology on the supply chain and procurement in the pharmaceutical industry. The objective is to identify the areas that blockchain has the highest potential impact so that the case company can prepare and take advantage of the technology. The research uses literature review and interviews of experts to form the basis of the research. The findings show that the key areas in the supply chain and procurement of the pharmaceutical company, which will be impacted by blockchain are track and trace, smart contracts, securing the Internet of Things (IoT) and avoiding counterfeiting.

The Problem is lack of end to end visibility, security, trust and traceability in current pharmaceutical supply chain.The actors involved in supply chain cannot completely guarantee the authenticity of drugs and thus patient at the end is the victim of any faulty/fake drug supplied.Supply chain as it is does not integrate the physical and information flows, i.e. Where the product/drug is exactly at the current moment is not kept track of. Our idea is to bring all these features to the supply chain by leveraging the advantages provided by blockchain and IoT. Blockchain will provide secure transactions among the stakeholders of the system and thus ensure security and prevention of bogus or faulty transactions among them, while IoT will help verify the authenticity of drug which will increase the rust among the stakeholders and it will also keep track of the temperature in the surroundings of the drug and also keep the track of the location of the drug which will connect the physical and information flows of the supply chain making every order trackable and secure.

In this work, we explore a blockchain structure applied to Pharmaceutical Supply Chain. Blockchain uses public key cryptography to create an append-only, immutable, timestamped chain of content. Copies of the blockchain are distributed on each participating node in the network.

The proposed system allows the addition of arbitrary logic to process, validate, and access the data. This is implemented via components of business logic known as smart contracts, which reside on the blockchain and are synchronized across all nodes. A smart contract is a string of computer code that executes whenever certain conditions are met, ensuring security and authorized access. The ability to create smart contract makes blockchain suitable for health care, where strict regulations govern how sensitive data can be used. Information exchange using smart contracts is transparent, conflict-free and eliminates the need for a middleman, as blockchain executes the data sharing based on the pre agreed conditions of the contractI. I

Literature Survey

In paper, the author describes the adoption of the Blockchain technology in the supply chain as a promising enhancement, suitable to provide benefits to all the different actors involved in the process. One of the most critical issues to be addressed in the implementation of Blockchain in the supply chain is the need to include all the different actors. Moreover, the sharing of the information along the entire Blockchain could lead to inertia in adopting the solution. For this reason, a correct implementation of the Blockchain technology in the supply chain must start from an analysis of the needs and the objectives of the different actors involved, with the aim to create a business model capable of highlighting the returns (both in economic and customer satisfaction terms) of this solution.

In paper, the author describes Hyperledger, a research network across industries, recently launched the Counterfeit Medicines Project. The project especially focuses on the issue of drug counterfeiting and is one of the current use cases within the research network, in which Accenture, Cisco, Intel, IBM, Block Stream, and Bloomberg are involved. As part of this project, each drug produced is marked with a timestamp. Firstly, thanks to this approach, it is possible to determine when and where the drug was produced at any given time. Secondly, such an approach can be specifically used to fight the production of counterfeit drugs. Using Blockchain, the origin of the product and its components are detected, and any transfer of ownership in each case is made clear and available to everyone. Forged, poor quality or stolen goods can be tracked and identified.

In paper, the author describes the challenges and future requirements within the pharmaceutical industry for tracing products, blockchain offers the most effective solution for sharing the data securely and efficiently throughout the supply chain and product life cycle.

In paper, the author describes that for blockchain to have a significant impact on supply chain management, it has to eliminate the need for trusted third parties, and to be adapted to the specific needs to supply chains, both in terms of data requirements, and in terms of the potentially complex structures of supply chains.

In paper, the author describes the technology behind sensors and electronic chips is evolving rapidly and renders them increasingly portable. This evolution gives companies the opportunity to attach sensors to physical goods to track their evolution and thereby detect potential failures and fraud. If you combine these sensors collecting massive amounts of data with a blockchain providing standardization, transparency, and traceability, you create value on the collected data.

Problem Definition

The problem is lack of end to end visibility, security, trust and traceability in the current pharmaceutical supply chain. The actors involved in the supply chain cannot completely guarantee the authenticity of drugs and thus patient at the end is the victim of any faulty/fake drugs supplied. Supply chain as it does not integrate the physical and information flows i.e. Where the product/drug is exactly at the current moment is not kept track of. Our idea is to bring all these features to the supply chain by leveraging the advantages provided by blockchain and IoT. Blockchain will provide secure transactions among the stakeholders of the system and thus ensure security and prevention of fake or faulty transactions among them ,while IoT can help verify the authenticity of drug which will increase the trust among the stakeholders and it can also keep track of the temperature in the surroundings of the drug and also keep the track of the location of the drug which can connect the physical and information flows of the supply chain making every order trackable and secure.

System Implementation.

Overview

The most obvious and outstanding benefit of blockchain is the fact that it removes the need for a centralized trusted third party in distributed applications. By making it possible for two or more parties to carry out transactions in a distributed environment without a centralized authority, blockchain overcomes the problem of single point of failure which a central authority would otherwise introduce, and at the same time, it makes transactions cheaper since the transaction fees charged by the central authority is removed. In place of a central authority, blockchain uses a consensus mechanism to reconcile discrepancies between nodes in a distributed application.

Methodology

There are four stakeholders:

  • Manufacturer/Pharmaceutical Companies
  • Wholesaler
  • Retailer/Pharmacist/Hospitals
  • Consumers

1) Manufacturer/Pharmaceutical Companies: The pharmaceutical industry discovers, develops, produces, and markets drugs or pharmaceutical drugs for use as medications to be administered (or self-administered) to patients to cure them, vaccinate them, or alleviate a symptom. Pharmaceutical companies may deal with generic or brand medications and medical devices. They are subject to a variety of laws and regulations that govern the patenting, testing, safety, efficacy and marketing of drugs.

2) Wholesaler: Person or firm that buys a large number of goods from various producers or vendors, warehouses them and resells to retailers. Wholesalers who carry only non-competing goods or lines are called distributors.

3) Retailer/Pharmacists/Hospitals: Pharmacists, also known as chemists or druggists are health professionals who practice in pharmacy, the field of health sciences focusing on safe and effective medication use. Pharmacists undergo university-level education to understand the biochemical mechanisms and actions of drugs, drug uses, therapeutic roles, side effects, potential drug interactions, and monitoring parameters. This is mated to anatomy, physiology, and pathophysiology. Pharmacists interpret and communicate this specialized knowledge to patients, physicians, and other health care providers

4) Consumers: A consumer is the one who pays something to consume goods and services produced. As such, consumers play a vital role in the economic system of a nation. Without consumer demand, producers would lack one of the key motivations to produce: to sell to consumers. The consumer also forms part of the chain of distribution.

Functioning:

  • The manufacturer produces the drug and marks it with a unique code, QR Code in this case. A hash is produced using the SHA1 algorithm which is the information in QR Code and stored on the blockchain for authentication purposes . Justification : QRcode not only has the merits of one-dimensional barcode, but also has the advantages of the other 2D barcodes, such as large capacity, high reliabil- ity, can encode Chinese words and images effectively, strong confidentiality and anti- counterfeiting, etc.. The most outstanding characteristics are super-fast decoding (it can decode 30 QRcode image symbols which has the capacity of 100 codewords) and omni-directional to read(rotates 360 degree within a plane). QRcode has the maxi- mum storage of 7089 digital data, or 4296 characters, or 2953 bytes data
  • The wholesaler verifies the origin of the product by scanning the QR Code and matching the hash of product received with the one on blockchain to authenticate it. The transaction between the manufacturer and the wholesaler is added to the blockchain after verifying its authenticity using IoT.Justification: In cryptography, SHA-1 (Secure Hash Algorithm 1) is a cryptographic hash function which takes an input and produces a 160-bit (20-byte) hash value known as a message digest.Several widely used security applications and protocols, TLS and SSL, PGP, SSH, S/MIME, and IPSec may use SHA-1. It is also used to identify that during transmission of information from sender to receiver is any changes occur or not.
  • The pharmacist verifies the origin of the product in a similar way as the wholesaler did. The transaction between the wholesaler and the pharmacist is added to the blockchain.
  • The patient/consumer verifies the origin of the product. The transaction between the pharmacist and the patient is added to the blockchain.

Conclusion

The research shows that pharmaceutical companies can pursue blockchain as an effective solution to adhering to future track-and-trace regulations in the pharmaceutical

industry. It also has the potential to reduce counterfeiting and corruption across the supply chain. Furthermore, companies can achieve significantly overhead cost reductions related to administering procure-to-pay activities by adopting blockchain for developing smart contracts. It can also potentially improve the security of IoT devices across the company’s supply chain. With this understanding, the case the system aims to prioritise and pilot blockchain applications for serialization and track and trace applications in the near term. In the medium term, the system will explore blockchain for the security of IoT devices and eliminate counterfeiting. In the long run, it wants to try blockchain for smart contracts. With the proposed system, traceability security and transparency can be handled well by combined results from blockchain and IoT.

References

  1. Blockchain in Logistics and Supply Chain: A Lean Approach for Designing Real-World Use Case.
  2. Blockchain Technology in Healthcare. 2016 IEEE 18th International Conference on e-Health Networking, Applications and Services (Healthcom).
  3. Blockchain’s impact on supply chain of a pharmaceutical company.
  4. Blockchain and Supply Chain Management. (Department of Industrial Engineering and Operations Research University of California, Berkeley).
  5. Continuous interconnected supply chain Using Blockchain & Internet-of-Things in supply chain traceability.
  6. Application Research of QRCode Barcode in Validation of Express Delivery
  7. 2016 Top Markets Report Pharmaceuticals Overview and Key Findings.(U.S. Department of Commerce.International Trade Administration).
  8. A Comparative Study of Hash Algorithms in Cryptography.International Journal of Computer Science and Mobile Computing, Vol.8 Issue.6, June- 2019

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Blockchain: A Solution for Improved Traceability with Reduced Counterfeits in Supply Chain of Drugs
Artscolumbia
Artscolumbia
Abstract The pharmaceutical supply chain is one of the areas most prominently considered when developing technology-driven solutions and use cases. For example, the global market for fake, substandard, counterfeit, and grey market medicines accounts for up to $200 billion per year[7]. Studies have uncovered a host of pharmaceutical products, medical devices, and biologics have been subject to counterfeiting the entire drug supply chain .Supply chain is susceptible to lots of pharmaceut
2022-04-18 03:40:10
Blockchain: A Solution for Improved Traceability with Reduced Counterfeits in Supply Chain of Drugs
$ 13.900 2018-12-31
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