Leading life sciences and healthcare companies Pfizer Inc., McKesson Corporation, AmerisourceBergen Corporation, and Premier Inc. have joined the MediLedger Project, an initiative of San Francisco-based technology company Chronicled, that builds blockchain-powered ecosystems and supply chain solutions.
“This innovative approach has the potential to transform how chargebacks work for the industry, allowing us to deliver better services to our members,” said Bill Marquardt, Vice President of Product Strategy and Planning for Premier Inc. “We are excited to collaborate with our partners to deliver these improvements.”
Chronicled herded the major companies into their MediLedger Project Contracting and Chargebacks working group that has begun work to design a protocol to dramatically improve the complex process of chargebacks, with work underway to finalize design in Q1/Q2 and aims to begin testing this protocol in Q3 2019. Working group participants believe this will reduce costly errors, enable healthcare participants to operate more efficiently, and lower the cost of patient care. MediLedger’s protocol aims to eliminate friction by connecting the disparate parties on a common network and automating the contract reconciliation and chargeback processes.
Medicines today are often sold via wholesale distributors, with pricing and eligibility contracts negotiated separately, and parties made whole on the price difference through a chargeback framework. Sharing of information across parties is challenging and creates many inefficiencies across the parties.
MediLedger continues to make significant progress toward establishing a truly decentralized blockchain network for the pharmaceutical industry. The network, which remains on track to go live by Q2 2019, has succeeded in establishing a protocol for saleable return drug verification that meets current 2019 DSCSA regulations. This solution provides full functionality, including GTIN lifecycle management, product change of ownership (M&A scenarios), and request and response messaging. In coast-to-coast testing, the network displayed request and response times of less than 400 milliseconds. The solution is complete and will be ready for commercial use and integration later this year. The Contracting and Chargebacks would represent the second solution available in the network.
MediLedger’s open protocols are available to anyone in the industry who wants to participate in the system, reducing aspects of “vendor lock-in.” Users’ data is kept safe behind a firewall, with information only being shared with the trading partners a user specifically chooses. There is no central repository of all data – the blockchain serves the purpose to cryptographically connecting records. And the system has no “superuser” access – even Chronicled, the network manager, does not have access to its users’ private and/or competitively sensitive data.
“This is what makes the project so special,” said Susanne Somerville, Chronicled’s CEO. “It’s distributed, it’s decentralized, and the data is private. Even though Chronicled is providing the technology, industry users operate the software themselves.”
All of these initiatives represent progress toward creating a network and ecosystem where competitors and trading partners can dramatically improve the processes they use to conduct business across the industry value chain.
MediLedger uses blockchain technology to achieve three things. First, it stores synchronized public data, ensuring that everyone is using the same “source of truth.” Second, it holds an immutable record of transactions that have taken place, but in a confidential way that safeguards valuable business intelligence. Finally, it utilizes smart contracts to enforce business rules and execute transactions to ensure the integrity of the system.
“These are the things we believe a blockchain should be used for,” said Chronicled CTO Maurizio Greco. “Blockchain technology, in the context of MediLedger, ensures that there is one source of truth, and we can design it so only the license holder can create records for its own products, for example. This may seem like a simple illustration, but it is revolutionary.”
Based in San Francisco, Chronicled is a software technology company leveraging blockchain to bring trust, efficiency, and automation to global supply chains. The company is developing solutions to enable decentralized blockchain networks that support multi-party supply chain ecosystems. The decentralized network architecture extends trust boundaries and enforces cross-organization business rules without revealing private and/or competitively sensitive data. The company is a founding member of Enterprise Ethereum Alliance, Trusted IoT Alliance, and Mobility Open Blockchain Initiative and has an active presence in Pharmaceuticals and Precious Metals and Minerals industries. See:http://www.chronicled.com and http://www.mediledger.com