4 Reasons Why Pharma Serialization Needs the Blockchain

Date April 20, 2016

Why is it that as the Pharma market for R&D and Manufacturing continues to expand towards 1 trillion dollars in 2016, the counterfeit drug market continues to expand as well?  The answer is simple:  The drug supply chain continues to expand thus providing more and more opportunity for counterfeit drugs to infiltrate the chain from additional touch points.  The solution is not so simple.  Due to regulatory mandates, the Pharma industry has identified Product Serialization as a key to reducing the amount of counterfeit drugs entering the supply chain.  Serialization utilizes applications and systems to track and trace the channeling of prescription drugs as they move throughout the entire supply chain. Serialization provides a series of unique identifiers (ie National Drug Code + Unique Serial Numbers) for identifying drugs that may be traced from the API (Active Pharmaceutical Ingredients) Suppliers all the way to the patient.  What serialization is focused on is based on these 4 factors:

1. Providing Visibility and Control within the entire supply chain

2. Product Verification

3. Product Traceability

4. Reduction in Counterfeit Drug Production

Given these factors and the mandates of the Drug Quality and Security Act (DQSA) (H.R. 3204) and The

Drug Supply Chain Security Act (DSCSA), the pressure is on for Pharma to act on developing and

implementing systems that can provide the solutions needed to improve the current state of the drug

supply chain and remain compliant with the FDA.  But why hasn’t serialization alone solved Pharma’s

problems?  If the concept of serialization already exists, why is Pharma still struggling?  The reason is

simple: Pharma has yet to identify the proper solution to work with serialization to better manage the

data!  This is where the Blockchain (Digital Ledger Technologies) comes into play.  By utilizing the

Blockchain as solution that integrates with the current serialization systems, 4 key factors can be


1. Distributed Ledgers – By securing information with Distributed Ledgers, supply chain

participants can now share immutable data and have better control and visibility.

2. Decentralization – Information no longer has to be centralized to be secure.  Information may

be shared, distributed and decentralized while maintaining security throughout the supply


3. Authentication – The underlying technology of the Blockchain allows for products to be

uniquely and securely identified thus supporting the verification and validity of the product.

4. Proof of Ownership – By leveraging Private Keys and Smart Contracts, product source,

ownership and final ownership may be tracked to provide additional information needed for


As more manufacturers and wholesalers begin to understand the issues around obtaining, securing and

sharing data, Blockchain solutions within Pharma we will evolve to become a very powerful solution that

has a greater fit within all the participants of the supply chain.  The Blockchain does not have to ‘Disrupt’

the current technologies and systems, rather the Blockchain can be used as a platform and source for

managing data in a manner that integrates with legacy systems.  Pharma will still have challenges

regarding the supply chain and counterfeit drugs entering the market, but with the Blockchain more

insight and visibility can be provided to enhance business processes and systems to remain compliant

and reduce counterfeit drugs.  For more information on managing the Drug Supply Chain with the

Blockchain contact us at info@isolve.io.