Proving the Business Case for the Internet of Things

IBM, KPMG, Merck and Walmart test FDA blockchain project

Steve Rogerson
June 18, 2019
IBM, KPMG, Merck and Walmart are collaborating in a programme from the US Food & Drug Administration (FDA) to evaluate the use of blockchain to protect pharmaceutical product integrity in the supply chain.
The companies were selected by the FDA to support the US Drug Supply Chain Security Act (DSCSA) that addresses requirements to identify, track and trace prescription medicines and vaccines distributed within the USA.
The programme is intended to assist drug supply chain stakeholders, including the FDA, in developing an electronic, interoperable system that will identify and trace certain prescription drugs as they are distributed within the USA.
"Our supply chain strategy, planning and logistics are built around the customers and patients we serve," said Craig Kennedy, senior vice president at Merck. "Reliable and verifiable supply helps improve confidence among all the stakeholders – especially patients – while also strengthening the foundation of our business."
Each company brings different expertise to the project, which will create a shared permissioned blockchain network that allows real-time monitoring of products. The proposed network is intended to help reduce the time needed to track and trace inventory; allow timely retrieval of reliable distribution information; increase accuracy of data shared among network members; and help determine the integrity of products in the distribution chain, including whether products are kept at the correct temperature.
"With successful blockchain pilots in pork, mangoes and leafy greens that provide enhanced traceability, we are looking forward to the same success and transparency in the biopharmaceutical supply chain," said Karim Bennis, Walmart vice president. "We believe we have to go further than offering great products that help our customers live better at everyday low prices. Our customers also need to know they can trust us to help ensure products are safe. This pilot and US Drug Supply Chain Security Act requirements will help us do just that."
Blockchain is designed to establish a permanent record and may be integrated with existing supply chain and traceability systems.
"Blockchain could provide an important new approach to further improving trust in the biopharmaceutical supply chain," said Mark Treshock from IBM. "We believe this is an ideal use for the technology because it can not only provide an audit trail that tracks drugs within the supply chain, it can track who has shared data and with whom, without revealing the data itself. Blockchain has the potential to transform how pharmaceutical data are controlled, managed, shared and acted upon throughout the lifetime history of a drug."
IBM, KPMG and Walmart have experience in implementing blockchain to help enhance the safety and traceability of products. Increasingly, customers are requesting more detailed information about products.
"Blockchain's innate ability within a private, permissioned network to provide an immutable record makes it a logical tool to deploy to help address DSCSA compliance requirements," said Arun Ghosh, KPMG blockchain leader. "The ability to leverage existing cloud infrastructure is making enterprise blockchain increasingly affordable and adaptable, helping drug manufacturers, distributors and dispensers meet their patient safety and supply-chain integrity goals."
The pilot project is scheduled to be completed towards the end of 2019, and results are expected to be published in an FDA DSCSA programme report. At that time, the project's participants will evaluate the next steps.
DSCSA was enacted by the US Congress in November 2013. It outlines steps to build an electronic, interoperable system to identify and trace certain prescription drugs as they are distributed in the USA. The DSCSA pilot project programme is intended to help identify and evaluate the most efficient processes to comply with and apply drug supply-chain security requirements. The programme will help in identifying attributes the system will need for product tracing and verification, as well as electronic means to share the information.