Some of the largest pharmaceutical and life sciences companies in the world have joined a blockchain-based drug supply chain working group. The MediLedger Project Contracting and Chargebacks working group is an initiative that seeks to improve on the chargeback process in the pharmaceutical industry.
The working group is an initiative of Chronicled, a startup that develops blockchain solutions for supply chains. In the pharmaceutical industry, drugs are sold through wholesale distributors. This process is complicated, with the chargeback framework causing many stakeholders a headache. The new blockchain-based solution intends to do away with this complicated process.
Some of the companies that joined the group include the Pennsylvania-based drug wholesale conglomerate AmerisourceBergen Corporation, California-based pharmaceuticals distributor McKesson, Charlotte-based healthcare improvement company Premier Inc. and Pfizer, the largest pharmaceutical company in the world.
Chronicled has been working on the platform for a while now. Initially, the startup was working with smaller players in the industry. However, by welcoming the big players, Chronicled is setting a new industry standard which other players may have no option but to join. Speaking to Forbes, Chronicled’s CEO Susanne Somerville stated:
“Chargebacks in healthcare are not a regulatory driven problem, but rather a business inefficiency. Last summer we came together with a smaller set of companies to build a prototype to solve some of the problems that happen today between contracting and chargebacks. We are excited to announce the addition of leading healthcare companies to the working group.”
Chargebacks have been a big challenge for the pharmaceuticals industry. According to experts at global consultants PwC, chargebacks represented the largest single deduction from gross sales for healthcare companies.
Chronicled’s blockchain-based MediLedger platform intends to solve this challenge for healthcare firms. The platform, which is set to launch in Q2 of this year, has already developed a protocol saleable return drug verification that meets the requirements of the DSCSA Act. This protocol provides such services as lifecycle management of a product’s item number, request and response messaging and change of ownership of a product in the case of a merger or an acquisition.
The members of the working group believe that blockchain technology will be the ultimate game changer in the industry. One of these is Justin Bowers, the vice president of financial services at McKesson. He stated:
“Chronicled has brought great opportunities to the industry to embrace blockchain not only driving cost out, but to deliver higher quality results to all of our customers and ultimately the patient. Technology is an enabler, not the silver bullet. Blockchain is empowering us to evolve and engage so there is a single source of truth for the network of decisions rather than individual processes within siloed infrastructures.”
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.