Leveraging Blockchain for Improved Health Care Delivery
Health care is a highly complex and data-intensive industry, characterized by numerous players, slow and costly transactions, and constraints on access to critical data sets that impede progress in research. Given these challenges, it is not surprising that blockchain technology is viewed as a potential solution for many of the industry’s biggest issues. With its ability to increase speed and improve R&D, care delivery and management, and reduce costs, blockchain has the potential to bring about a significant disruption to the status quo in health care.
The blockchain technology, a distributed online ledger that can verify the authenticity of a piece of data, enables secure and validated anonymous transactions and eliminates intermediaries such as agents and brokers. This technology, which is behind Bitcoin and other cryptocurrencies, has the potential to change how confidential data is stored and shared and how transactions are conducted.
With the right application, blockchain has the potential to transform the economics of transaction costs and trust in the health care industry. Our focus in this article is to bring a strategic perspective to the potential of blockchain in health care and to outline four high-impact scenarios.
Scenario 1: Securing Supply Chains
One of the most promising applications of blockchain in health care is in the remaking of supply chains across the sector. Blockchain transactions, recorded on a validated, unalterable ledger, can be applied to the tracking of raw materials, compounds, or components from source to patient or consumer. Information can be logged onto the blockchain ledger via direct data entry or through data transfer from IoT connected sensors. The transparency of information on the blockchain enables stakeholders to identify counterfeit materials, malfunctions, and environmental breakdowns, and to confirm the authenticity of materials through validation that they have not been tampered with or subjected to adverse conditions.
Companies such as MediLedger Project, backed by pharmaceutical giants Genentech and Pfizer, are already piloting blockchain solutions to track medicines. Other companies, such as Modum.io and BlockVerify, are combining blockchain and IoT technologies to improve pharma supply chain efficiency and authenticate products.
Scenario 2: Empowering Patients with Control over Their Data
Blockchain can play a role in enabling patients to take control of their data and grant access to physicians at different institutions for improved diagnoses and medical interventions. By recording all medical data transactions on a blockchain, patients can maintain a complete audit trail of all participants who have had access to their data. This not only provides for better diagnoses and treatment-related benefits but also helps build trust between patients and other stakeholders in the health care system.
Google’s DeepMind is exploring blockchain’s potential in patient data, working with Britain’s National Health Service to deploy a private blockchain to create robust audit trails for personal data access.
Scenario 3: Streamlining Clinical Trials
Clinical trials can be made more efficient and effective through the use of blockchain technology. By creating a shared, secure and transparent database of clinical trial data, blockchain can eliminate the need for manual reconciliation and ensure that all stakeholders have access to the most up-to-date information. This can also help reduce errors and inconsistencies, leading to more efficient and accurate clinical trials.
Scenario 4: Improving Drug Development and Commercialization
Finally, blockchain can play a critical role in improving drug development and commercialization. With blockchain, pharmaceutical companies can create a secure and transparent database of drug development and testing data, ensuring that all stakeholders have access to the most up-to-date information. This can reduce the time and cost associated with drug development and testing and ultimately lead to the faster and more efficient commercialization of new drugs.
Investment in Blockchain Healthcare: An Overview
Blockchain technology has gained significant traction in the healthcare industry with several startups and large companies investing in its development. While funding for blockchain in healthcare remains relatively small compared to other technology areas such as artificial intelligence, the pace of funding activity continues to accelerate. This paper provides an overview of the funding, technology, and talent required for blockchain adoption in healthcare, as well as the governance and collaboration challenges the industry will face.
Venture capital firms and angel investors are actively investing in early-stage blockchain healthcare companies. For example, Gem, a California-based blockchain solutions provider, received $7.6 million in funding from Pelion Venture Partners in 2016. The company has now raised $12.5 million since 2014. Similarly, PokitDok raised $5 million from GIS Strategic Ventures and McKesson Ventures in 2017, bringing its total funding to $50 million since 2012. Other startups like Patientory and Candor Insurance have also received significant funding to develop their blockchain-powered platforms.
Technology and Talent Landscape
Blockchain technology in healthcare still faces several technical challenges, including processing speed, security, privacy, and skills availability. Finding the right talent to develop scalable protocols will remain a challenge due to competition for skills in other technology areas such as AI and machine learning. Over time, however, technology-related issues are likely to become less of a barrier to blockchain’s broader application as governance and collaboration become more pressing concerns.
Governance and Regulation
Blockchain technology raises complex questions around governance, particularly regarding the responsibilities and rights of individual participants, and what should be done in the event of a problem. While cryptocurrencies are largely unregulated, the use of blockchain in healthcare will require legal and regulatory oversight, including laws governing smart contracts, data sharing, and financial reporting. For example, ensuring access to patient data in emergency situations, while still maintaining data privacy, will be a significant challenge.
Collaboration in Healthcare
The success of blockchain technology in healthcare depends on the willingness of multiple parties to participate in blockchain-enabled systems or networks. However, achieving blockchain’s full potential will require overcoming significant barriers to collaboration, including standardizing data definitions and establishing common protocols.