On Friday, the MediLedger Project -- a working group whose members include two dozen of the largest companies involved in healthcare -- submitted its final report to the Food and Drug Administration for a pilot project that will use blockchain to secure the pharmaceutical supply chain.
The collaborative effort is a who's who of the healthcare industry, with participation from AmerisourceBergen (NYSE:ABC), Amgen (NASDAQ:AMGN), Eli Lily (NYSE:LLY), Gilead Sciences (NASDAQ:GILD), GlaxoSmithKline (NYSE:GSK), McKesson (NYSE:MCK), Novartis (NYSE:NVS), Novo Nordisk (NYSE:NVO), Pfizer (NYSE:PFE), Roche (OTC:RHHBY), Sanofi (NASDAQ:SNY), Walgreens Boots Alliance (NASDAQ:WBA), and Walmart (NYSE:WMT).
The blockchain technology the project uses was created by a private company, Chronicled, in 2017. Chronicled is tiny -- its last funding raise was for $16 million -- but it has huge ambitions. The MediLedger Project might one day secure the distribution chain for the entire $1 trillion pharmaceutical industry.
Stopping counterfeit drugs.
The World Health Organization estimates that counterfeit drugs cost the healthcare industry approximately $75 billion in revenues every year. Worse, counterfeit medications can kill the patients who take them.
In 2013, Congress passed the Drug Supply Chain Security Act (DSCSA). Its goal was to protect and secure drug supply chains in order to prevent counterfeits from slipping into the market unnoticed. Pharmaceutical companies must meet the federal requirements for supply chain security.
"We are very pleased that companies across the industry joined Chronicled in the MediLedger FDA Pilot Project," Chronicled CEO Susanne Somerville said. "We were able to show that a blockchain solution is feasible to meet the 2023 DSCSA requirements and are privileged to take part in making the US drug supply chain safer for patients."