image credit: Pexels

How the Biopharma Industry Is Using Blockchain to Increase Security

September 29, 2023


Biopharma supply chains have a far-reaching impact on health worldwide and should be managed accordingly. 

However, complexities in the manufacturing, distribution, and delivery of life-saving drugs are unavoidable—especially given the lingering effects of the pandemic and the current global economic climate.

Fortunately, blockchain technology can enhance the security and transparency of biopharma supply chains, promising to improve aspects like drug traceability and integrity.

In this article, we will explore the foundational features of blockchain technology, how the pharmaceutical industry enforces data integrity, and where blockchain can be applied to secure biopharma supply chains worldwide.

A Brief Breakdown of Blockchain Technology

Blockchain is renowned for its rapid transformation of the financial and cryptocurrency markets. However, the technology offers benefits that extend beyond those two industries.

Built on a distributed digital ledger, the blockchain network records and verifies every activity happening on it. Two aspects of the ledger are particularly useful when placed in a pharmaceutical context: validation and transparency.

If a user wants to add new information to the ledger, it has to be reviewed and validated by every other user on the network. And because each user has a copy of the same digital ledger, it’s impossible to alter any information on it. 

The ALCOA+ Methodology

To understand the potential applications of blockchain in the biopharma supply chain, we must first recognize the current state of the biopharma landscape. 

Naturally, the industry follows strict best practices and protocols to ensure data integrity and quality throughout the product lifecycle. This is enforced through the ALCOA principles:


All data that is recorded throughout the product lifecycle must be traceable back to a specific individual or source. This helps ensure accountability and traceability in all actions. 


Data entries should be clear and easy to understand, in order to prevent misinterpretation or errors.


Data cannot be backdated or altered after the relevant activities have occurred; it should be entered in real-time. This is to ensure the data’s accuracy and authenticity.


The original data should be preserved, without alteration or corrections. If modifications are made, they must go through a validation process, and the new information must reside alongside the original entries.


Accurate data is paramount. Any omissions or inaccuracies can have significant consequences, therefore all data must be entered with the ultimate precision.

Updates to ALCOA 

Since its advent in the 1990s, ALCOA has been updated with four new guiding principles, taking on new life as ALCOA+. The additions assert that pharmaceutical data must be complete, consistent, enduring, and available.

The aforementioned principles are the backbone of data reliability and quality in biopharma. In particular, they are critical in regulated environments—where Good Manufacturing Practice (GMP) and Good Laboratory Practice (GLP) standards are mandatory.

Blockchain’s Application in the Biopharma Supply Chain

In 2019, the U.S. Food and Drug Association (FDA) announced a pilot program to demonstrate the effectiveness of blockchain technology in establishing a unified view of product traceability and improving patient outcomes.

The FDA named Walmart, Merck, KPMG, and IBM as major participants in the program. The objective was to consolidate expertise from each of the leading corporations to create a shared blockchain network in support of U.S. Drug Supply Chain Security Act (DSCSA) requirements.

In the Blockchain Interoperability Pilot Project Report, which summarizes the program’s findings, the FDA and DSCSA cite useful applications in the following areas:

  • Drug provenance and data privacy
  • Increased patient safety
  • Reporting
  • Recall functionality

More recently, the pharmaceutical giant, Pfizer, embarked on an innovative and unprecedented blockchain venture. They submitted a request to join VitaDAO, a decentralized autonomous organization (DAO) in the biotech field, that was founded on the principles of blockchain.

DAOs are groups that allow entities to join and collectively vote on research areas they would like to fund. In line with the founding concept of blockchain, DAOs’ non-hierarchical nature means they are concerned with making an impact, rather than corporate gain.

Pfizer demonstrated an interest in VitaDAO’s initiative in drugs that could increase human lifespans, and since joining, the collective has raised over $4 million for longevity research.

While larger corporations have the resources and ability to take advantage of blockchain-based benefits, it may be more difficult for smaller institutions like pharmacies and clinics.

With regard to the prescription medication market, blockchain has many potential applications. Fraud prevention and increased patient data privacy are just two of the many benefits that a digital ledger can provide to pharmacies and health clinics.

Security in Electronic Health Records

Electronic health records (EHRs), the cornerstone of modern healthcare systems, have become increasingly vulnerable to data breaches and cyberattacks in recent years. Without question, unauthorized access to sensitive patient information is a huge issue for the industry. 

Many companies still use traditional EHR software, which is prone to security risks, as hackers grow more sophisticated in their exploit attempts. To safeguard patient data and ensure that it is accurate and up-to-date, biopharma and other healthcare firms must stay at the forefront of technology.

Blockchain’s transparency and validation system offers numerous benefits to enhance the interoperability and overall security of modern EHR platforms. 

With the increasing need for security in patient data sharing, there are a number of blockchain solutions purpose-built for EHR systems, such as and Medrec:M.

Combatting Counterfeit Drugs

The WHO reports that around 10% of all pharmaceutical products on the market are counterfeit or do not meet quality standards. It’s clear that this is a major concern that needs to be addressed.

Powerful blockchain capabilities such as immutability, unique product identifiers, real-time tracking, and tamper-proof verification can help eliminate the scourge of counterfeit drugs in biopharma.

But perhaps the most promising feature of blockchain is smart contracts. Smart contracts are pre-programmed with specific rules. They are self-executing, which means that once the rules are met, the contract allows an action to go through.

To help in the fight against counterfeit products, companies can bolster their transactions with smart contracts. This will help verify the authenticity of medications being sold, bought, or exchanged.

Additionally, smart contracts leave no room for human error or bias. The automation involved ensures that the authentication process is highly accurate and reliable, giving stakeholders, including consumers and healthcare professionals, confidence in the product’s authenticity.

Simplifying Regulatory Compliance

Adhering to regulatory requirements in the biopharma industry is a complex and stringent process. Needless to say, it is a critical aspect of managing a pharmaceutical supply chain. From product testing to quality assurance, the intricacies of regulatory compliance can be simplified with blockchain technology.

For example, Chronicled’s blockchain-based platform helps companies ensure regulatory compliance. With the help of their flagship offering, MediLedger Network, businesses can ensure secure data collaboration and streamline mandatory compliance procedures.

By recording all data on the blockchain, companies can create a verifiable trail of transactions from manufacturing to distribution, and significantly increase the integrity of the supply chain. In doing so, stakeholders will also strengthen consistency with guidelines like the ALCOA methodology.

Challenges with Leveraging Blockchain in Biopharma

The technology itself is quite complex, so there are, of course, a few hurdles that biopharma representatives must address before adopting blockchain fully.

Transitioning From Traditional Supply Chain Systems

Many drug companies may find it difficult to embrace the potential of blockchain because of its complexity and lack of awareness of its benefits. To successfully adopt blockchain, the relevant stakeholders would have to receive extensive training on the technology. In addition, businesses must be fully committed to embracing blockchain, both financially and knowledge-wise.

Concerns about Transparency

Biopharma firms handle a large volume of sensitive patient information, and blockchain relies on transparency to reinforce its security. Trust may be an issue, especially when it comes to sharing data on a network that is fully visible to a number of entities.

Scalability and Blockchain’s Maturity

Blockchain is yet to reach full maturity as a technology, and this may create a range of potential dilemmas. One such issue is a blockchain network’s ability to scale with demand. As a biopharma company grows, it may encounter data-related issues with its chosen blockchain platform. 

In Closing

The benefits of blockchain for security and transparent data sharing are undeniable. From government-level initiatives such as that of the FDA and DSCSA, to smaller blockchain-based platforms, the biopharma industry is starting to recognize the transformative potential of blockchain.

With patient health and sensitive information at stake, it seems that stakeholders involved in biopharma supply chain management are taking steps to harness the power of blockchain. However, there is a long way to go to ensure this technology is used to its full potential, from manufacturing to distribution.