DHL wants to see blockchain in life sciences, pharmaceuticals
- DHL and Accenture partnered to release a report on how blockchain can transform logistics in a variety of industries, with a special focus on the life sciences and pharmaceuticals, according to a press release.
- The report lists a few key features of blockchain that DHL and Accenture believe are instrumental for transforming supply chains: data transparency, security, asset management and smart contracts.
- In retail, blockchain could encourage "ethical, sustainable consumption;" in life sciences and healthcare, the tech could verify "a single origin of truth;" in automotive and manufacturing, blockchain could "manage physical assets;" in energy, it could "eliminate marketplace inefficiencies."
DHL and Accenture's report shows how blockchain could directly affect a variety of industries and accelerate their supply chains.
"Blockchain can achieve cost savings by powering leaner, more automated and error-free processes. As well as adding visibility and predictability to logistics operations, it can accelerate the physical flow of goods," the report states.
The report also highlights the immediate necessity of blockchain, especially in the life sciences and pharmaceutical industries. "According to Interpol, around 1 million people each year die from counterfeit drugs, 50% of pharmaceutical products sold through rogue websites are considered fake, and up to 30% of pharmaceutical products sold in emerging markets are counterfeit."
As counterfeits become more prevalent in the age of e-commerce, and as supply chains increasingly globalize, a reliable, error-free method of documentation is imperative for not only shippers but also 3PLs.
Blockchain not only facilitates trust between a company and its suppliers when it comes to financial transactions, but also encourages trust between the manufacturer/brand or retailer and consumers because blockchain can verify the identity and passage of goods along the supply chain.
Retailers able to prove that their supply chains and products are ethically sourced is becoming paramount to consumers, and even more so within the drug supply chain. If a company is able to verify that its goods or drugs are ethically sourced and transported, and that they are authentic and undamaged, it will save weeks and months of time in addition to potentially millions of dollars every year.
DHL and Accenture are developing a blockchain-based serialization system to better track and verify the validity of drugs through the supply chain.
"Our proof of concept demonstrated the opportunities blockchain presents in the fight against counterfeit pharmaceutical goods. Together with our partners we are actively refining the solution as well as working with key industry stakeholders to operationalize the concept," said Keith Turner, CIO Chief Development Office at DHL Supply Chain, according to the report.
But there are still challenges to implementing blockchain in supply chains. The most pressing issue is that in order for blockchain to work, it has to be a corporate, top-down, multi-company, supply chain-wide effort. Industries need to start adopting in large numbers before blockchain can reach its full potential.
Then, companies and regulators will need to work out the legal kinks, standards and protections. While numerous companies are already joining and launching blockchain alliances in logistics and shipping industries, their initiatives only go so far unless shippers and suppliers get on board.
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