Pharmaceutical Commerce - July/August 2017 - 22

Information Technology
Blockchain: the technology to make DSCSA work after 2023?
Industry experts are grappling with the eventual requirement to provide accurate supply-chain traceability
By Nicholas Basta

Not withstanding FDA's June 30
announcement that it was delaying
enforcement of the Drug Supply Chain
Security Act's next phase by one year
(November 2017 to November 2018), the
global pharma industry will have invested
several billion dollars in hardware and
software to comply with that law and related
efforts to secure the pharma supply chain
around the world. And while other countries
have their own pathway toward providing
traceability of pharma shipments, the US'
effort has a small problem: as written, no one
knows how the law will work effectively by
2023 when all of its components are to be in
place. Oops!
To be sure, there are many, many details
keeping IT managers, packaging engineers
and logistics specialists up at night,
brainstorming ways to address knotty issues
like aggregation (the need to identify what
serialized numbers are within a carton of
many packages of serialized product),
product returns (which need to be re-verified
before being re-entered into trade) and the
millisecond-level response time a traceability
system will call for. Smart, collaborative
efforts going on now will address many of
these details. But the bigger problem (see
box) is: how to determine the chain of
custody of a pharma package that might
show up on a pharmacy shelf, when no one
authority or source has all the information
about the product transfers that brought the
package to the shelf? (Fig. 1) In other words,
how to verify the integrity and authenticity
of an individual pharma package-which
is the original goal of the entire DSCSA
Enter the blockchain topic. By essentially
making the storage of transaction data (such
as the sale of a pharmaceutical product from
a manufacturer to a wholesaler) a secure,
unalterable yet sharable message, blockchain
has the potential to streamline the datastorage and -access problem. It also has the
potential to make this data process relatively
inexpensive to set up (cloud-based data
storage being one of the main operating
expenses). But the technology is relatively
unproven in commercial transactions, and
executives involved with current DSCSA
implementation difficulties will be loath
to take on yet more burdens. However,

blockchain is advancing fairly rapidly;
developers are attracting venture capital, and
it's conceivable that the technology could be
ready to use by the time the 2023 DSCSA
deadline arrives.
Blockchain has major developmental
commitments at IT systems houses such
as IBM, Unisys, Deloitte, Accenture and
others. In March, two San Francisco, CA
companies-a blockchain startup called
Chronicled, and a pharma supply-chain
consultancy, the LinkLab, announced a
DSCSA-oriented pilot program (they say
they have the support of a major pharma
company). iSolve, an East Norriton, PA
consultancy, is exploring blockchain
applications in various life sciences tasks,
including supply chain traceability. Rubix, a
Toronto, Canada blockchain development
com p a ny su pp or te d by D e l oi t te , i s
exploring a variety of supply-chain-related
A number of these efforts come together
at the Center for Supply Chain Studies
(C4SCS), a nonprofit group set up by Robert
Celeste, a former executive with the GS1
organization (GS1 has a number of standards
specific to healthcare data tracking, notably
the EPCIS standard, which is fundamental
to DSCSA compliance.) C4SCS is currently
running a workgroup that meets monthly to
explore blockchain applications to DSCSA
T h e ven dors of D S C S A- en a bl i n g
software currently being installed at pharma
companies and their trading partners appear
to be keeping a wait-and-see attitude toward
blockchain. One exception is TraceLink,
the industry leader in DSCSA compliance
implementations, which is a member of
C4SCS, and recently announced a service
to help its customers transfer compliance
data among themselves (the catch here
is that at least one of the parties needs to
be a TraceLink client, so non-TraceLink
transactions will remain outside its system).
Blockchain basics
The comparison has been frequently
made that blockchain technology today is
very much like the internet was circa 1990:
Something important was going on, led
by a disorganized mass of self-proclaimed
experts; substantially different methods to

Fig. 1. A part of the traceability problem under current DSCSA guidance: how does a hospital
pharmacy (at the far right) know to connect with the manufacturer at the far
left to verify a pharma package's serial number? Credit: C4SCS

effect communication were competing for
attention and market share; and there was
enormous potential but no clear way of
achieving it.
Most people associate blockchain with
what they've heard about bitcoin-a
nongovernmental currency that somehow
retains value simply because the people using
it (or having it) agree on that value. Bitcoin's
driving force as external to government also
gives blockchain an outlaw air, which doesn't
help matters. But the reality is that there is
much more to blockchain than bitcoin and
that problems of verifying transactions of
many types besides bitcoin "cryptocurrency"
are attracting intense interest from IT
developers. In this broader context, the
"blockchain" concept itself is losing out to
"distributed ledger" technology (iSolve, for
one, prefers to speak about "advanced digital
ledger technology," or ADLT, rather than
A distributed ledger is simply a list of
records (such as transactions) that is stored
on multiple, separate IT systems in a
network. Each new record-and each query
or interaction with a record-becomes a
recordable event itself in the ledger. When
this is combined with powerful identity
management tools (which can either be a
distributed-ledger process itself, or some
variation of identity-security methods) a
"non-repudiatable" record is created,

and thus, trust between two parties to
a transaction.
Another cross-cutting concept
in distr ibuted ledgers is the "smar t
contract"-a set of code that automatically
takes an action (such as authorizing a
payment) when preprogrammed steps
have been followed. In theory, a smart
contract could become the equivalent of
the Transaction History (TH) document
specified by DSCSA-the set of records
that establishes that Party A sold Product
X to Party B, with the identity of the two
parties and the product verified (i.e., is nonrepudiatable).
An example of how far blockchain or
distributed-ledger technology has to go
is that the concept of a smart contract,
as opposed to a piece of paper with two
signatures on it, is yet to be accepted
in courts of law or international trade
Like the early days of the internet, when
IT developers were grappling with Ethernet,
the TCP/IP protocol, the World Wide Web
and other concepts, today's blockchain
developers have created a growing list of
data-exchange platforms or protocols (or
protocols that are platforms). Ethereum,
a relatively new cryptocurrency platform,
is being promoted by, among others, IBM
and Microsoft. Others include such systems
as Blockstream, Everledger, Bloq, Fabric,

The DSCSA traceability mandate
T h e 2 02 3 DS C SA a l l - d i g i t a l t ra n s a c t i o n st a te m e n t m a n d a te s t h e f o l l ow i n g o f m a n u f a c t u re r s a n d t h e i r t r a d i n g p a r t n e r s , w h o s h a l l h ave :
The systems and processes necessary to promptly facilitate gathering the information necessary to produce the transaction information for each transaction going back to the manufacturer,
as applicable, shall be required-
(i) in the event of a request by the Secretary (or other appropriate Federal or State official), on account of a recall or for the purposes of investigating a suspect product or an illegitimate
product; or
(ii) in the event of a request by an authorized trading partner, in a secure manner that ensures the protection of confidential commercial information and trade secrets, for purposes of
investigating a suspect product or assisting the Secretary (or other appropriate Federal or State official) with a request described in clause (i)
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