Today, the Center For Supply Chain Studies (C4SCS) announced that they are launching a new study called “Blockchain & Metadata”. C4SCS has been studying blockchain applications in the US pharma supply chain for nearly two years—including its potential use to help the industry meet future requirements of the Drug Supply Chain Security Act (DSCSA) (see “Could Blockchain Technology Be Used For DSCSA Compliance?”). This newly announced study marks the first time the organization plans to explore applications of blockchain technology without specifically attaching them to pharma, although the subject definitely applies in pharma. Target participants of this study include those in any industry that could benefit from applying blockchain’s unique blend of capabilities to fully automate compensated data sharing.
The stated goal of this study says it succinctly:
“We’ll explore the use of blockchain platforms and metadata standards to more clearly identify and demonstrate the curation, sourcing and sharing of datasets. ”
The study will support the objectives of both nonprofit and for-profit entities. The aspects of this study that caught my eye are value and revenue. In a blockchain-based solution, those may lead to the use of a crypto currency for trading assets like datasets, and result in revenue for the seller. The timing of this study matches my own thinking about the use of crypto currencies in blockchain-based solutions. Prior to the last few months, I had always felt that the crypto currency feature of most blockchains was something that would need to be discarded in any application in the pharma supply chain. But it always bothered me how closely tied crypto currencies were to blockchain as a technology. In fact, they appear to me nearly fundamental to the concept. Was it a good idea to use a technology that contains a fundamental concept that you planned to discard? Probably not.
A few weeks ago I spoke on a blockchain panel before an audience of lawyers who wanted me to share with them how blockchain might be used to meet the DSCSA. I used the knowledge I had gained by participating in two of the C4SCS studies. They were more interested in the blockchain part than the DSCSA part of my presentation, and the thing that really attracted their interest was smart contracts. Before preparing for my presentation I assumed that smart contracts were little more than small computer programs that would manipulate data, just like any other computer program. But since then I have come to learn that there is a valid reason that lawyers should be interested in these special pieces of computer code. And that’s because of their ability to trigger financial transactions today through the crypto currency built into the blockchain in use, and any other type of transaction that a government might allow in the future.
That is the future of blockchain: when governments and courts fully recognize these transactions as valid and enforceable. I suppose that might take a decade or more to happen at the federal level, and even longer for the state and county levels, but that’s likely where it’s headed. Until that time, people need to pay attention to the technology and learn all they can about it. Don’t ignore the crypto currency aspect of blockchain as I did initially. The combination of crypto currency and smart contracts is where the technology ceases to be just a computer “thing”, and it becomes the magic that will likely underpin all commerce in thirty years.
This new C4SCS study is aimed at the potential use of blockchain to enable a kind of commerce that was too complex to get started—until now. Companies have been buying and selling supply chain data for a long time. The kind of datasets sales that it appears C4SCS will investigate includes those existing datasets, but also those that are smaller, more granular and perhaps even ad hoc. This is just my interpretation of the study announcement. Make sure you read it for yourself and don’t let my interpretation color your interpretation. If you have questions about their plans for the study I urge you to contact them directly (see their announcement).
Regular RxTrace readers should also read an executive brief published by C4SCS in February titled “The Value Of Blockchain And Its Application To The Drug Supply Chain Security Act”. The final reports of their DSCSA-specific studies will be published on the C4SCS website.
It may seem easy to laugh-off blockchain as just the latest ball-of-hype gripping the industry. I’ve heard people compare the hype surrounding blockchain to that which surrounded the potential use of RFID ten years ago. Long-term readers of RxTrace know that RFID crashed and burned in the pharma supply chain, despite gaining some traction here in the mid-2000s (see “RFID is DEAD…at Unit-Level in Pharma”). Unlike RFID, blockchain technology will not crash and burn because it is such a multi-purpose technology, applicable in a huge variety of solutions that span from traditional to never-before-possible, in all types of businesses, not just pharma. In fact, blockchain is comparable to databases in terms of wide ranging applicability. But I don’t mean to imply that blockchain is just a database replacement technology. It isn’t, and the primary reasons are the crypto currencies and smart contracts features. You owe it to yourself and your company to study it enough to learn why. The C4SCS studies are the best way to do that.
One thought on “Important New Blockchain Study Launched”
What is the difference (in Supply Chain) between a smart contract and ERS (evaluated receipts settlement) which is in place today?
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