How Blockchain Technology Could Transform The Pharmaceuticals Industry Part 1

Clinical trials

As pharma companies are creating new drugs to treat more and more human conditions, the complexity of their research and work keep increasing. To bring a new product to a market, a pharmaceutical company needs to conduct research, possibly patent the results of the research, run and fund clinical trials, get government approvals, manufacture the drugs and then bring them to the market. This process is extremely long and expensive, which is why it is not uncommon for a single pill of a new drug to cost hundreds of dollars. There is a number of ways how the pharmaceutical company could use blockchain technology to streamline its processes.


  1. Use blockchain to store and share data about clinical trials

Clinical trials are expensive to run and are one of the reasons why it takes so long to bring a new drug to a market. The process of creation of a new drug is not just about research. A large part of the process is about the data that the companies receive from trials. During the trials, pharma companies generate a lot of data that they are sharing internally, with investigators, and with the Food and Drug Administration. As the number of parties involved in the process increases, the complexity of managing the data also increases.

In addition to this, sharing of the data may have a conflict of interest. The company that brings a new drug to the market is interested in interpreting the data from the positive perspective because not getting the drug approved would mean loss of money. Because of this, it may not want to share all of the data and may want to find ways how it can present the results of the trials in the way that benefits the company. At the same time, the government and other involved parties may be inclined to see the results of the tests differently.

For example, in 2012, GlaxoSmithKline has settled a lawsuit for $3 billion dollars ($2 billion in civil penalties and $1 billion in criminal fines) for promoting its antidepressants in a way not improved by the United States Food and Drug Administration (source: ). The company pleaded guilty to the charges because of unapproved uses and failure to report certain data about one of its drugs. Whistleblower employees at GlaxoSmithKline contacted the authorities after the company did not disclose certain data about heart risks posed by the drug called Avandia.

A blockchain solution for storage of data about clinical trials could ensure the integrity of data because blockchain technology uses cryptography algorithms to make it impossible to change the data added to the blockchain. For example, the Bitcoin network uses an algorithm called proof-of-work together with cryptographic validation called SHA-256. This means that once the miners on the Bitcoin network compile the data about transactions on the network, they need to run the data through the cryptography algorithm SHA-256 and come up with a number called hash. Every set of data can only return one and the same hash once processed via a cryptography algorithm and two different sets of data, even when the data is similar, would have very different hashes. For example, the set of data (1,1,2) could have the hash equal to e45RT and the set of (1.01, 1, 2) would have the hash WW11q.

On the Bitcoin network, the sets of data contain information about thousands of transactions, which is why the hashes are much more complex than in the example above. The Bitcoin network is fully transparent, which means that anyone could access the log of the Bitcoin blockchain and see information about all the transactions in Bitcoin since the creation of the network by Satoshi Nakamoto in 2009. For instance, block #520011 of the Bitcoin blockchain contains information about 1819 transactions and the hash for the block is 0000000000000000003370eabab1fad049f54b84cd78630c9ef657f88c5a6466 (you can see this information by visiting the page for the block on the website of the Bitcoin blockchain explorer at )

A pharmaceutical blockchain network could function in the similar way: it could contain data about the trials and seal the data with hashes so that all the parties would know that the data is tamper-proof. With blockchain, it would be impossible for a pharmaceutical company, or any other party, to edit the data once the data becomes part of the blockchain.