Pharma Giants Use Ethereum Network to Prevent Counterfeit Medicine
Pharmaceutical giants Pfizer and Genentech, two conglomerates with a combined market cap of over $300 billion, have introduced the MediLedger project, a blockchain platform built on top of the Ethereum protocol to prevent counterfeit medicine and pills entering large-scale supply chains of pharmaceutical companies.
According to Fortune, the MediLedger Project is using Quorum, an enterprise-focused Ethereum-based smart contract platform developed by J.P. Morgan to maximize high speed, high throughput, privacy, and flexibility.
In an interview with David Voell during June 2016, the engineering lead for J.P. Morgan’s corporate and investment banking group, he described Quorum as a “permissioned implementation of Ethereum supporting data privacy.” The Quorum protocol is structured and modified after the Go Ethereum Client. Voell stated:
“We get the best of both worlds. The key to this whole thing, again, is a single blockchain of everyone continuously checking the integrity. [Still, there is a] clear separation between private and public.”
The utilization of J.P. Morgan’s Quorum smart contract platform by the MediLedger Project is the first commercial implementation of the bank’s blockchain technology. Since 2016, J.P. Morgan has actively collaborated with the Enterprise Ethereum Alliance and its premiere member companies including Microsoft, IBM, and Intel to develop and integrate a flexible blockchain network that can be used to automate operations and reduce operating costs.
In the upcoming months, developers behind the MediLedger Project will continue to run pilot tests and simulations based on the actual supply chain of the two pharmaceutical companies. Because the verification of supply chains which are as large as that of Pfizer and Genentech, developers will continue to focus on building tools that can address some of the scalability issues which may arise in dealing with millions of data points on a regular basis.
Supply chain consulting group The LinkLab and San Francisco-based blockchain company Chronicled have been selected to complete the development, testing and implementation phases of the MediLedger Project. Ryan Orr, the CEO at Chronicled, explained that although the blockchain platform is permissioned, it will require a consensus protocol in which every participant operates and controls a node to ensure that the platform remains immutable, unalterable and transparent.
“The pharma industry consists of large conservative companies, so it takes a lot of confidence to build up a network like this,” said Orr.
As of current, pharmaceutical companies rely on completely centralized systems and servers to communicate and share information with partners and consumers. Orr explained that such outdated method of processing data could lead to various vulnerabilities regards to security, which often results in the loss of valuable data and key business information.
Through the usage of Ethereum’s smart contracts protocol and cryptographic time stamps, the MediLedger Project will be able to identify, with high precision, irregularly manufactured or counterfeited medicine or pills instantaneously. In a statement to Fortune, Genentech senior vice president of Managed Care and Operations, Marc Watrous, explained:
“Ensuring the safety of people receiving our medicines is of utmost importance to us. We look forward to exploring the potential benefits that this pilot could provide in protecting our medicines across the entire supply chain.”
Currently, developers of the MediLedger Project from Chronicled and The LinkLab are focusing on developing a wide range of tools which can best benefit pharmaceutical companies and their supply chains. Through real-time development and data processing, the two enterprises in charge of the development of MediLedger are trying to provide a shared platform in which a consortium of pharmaceutical companies are able to send and receive information to trace medicine shipments rapidly.
