Blocking spurious drugs: Blockchain tracking of drug value-chain can help tackle problem

The problem with the monitoring of spurious drugs in the country is perhaps best spelled out by the fact that there doesn’t seem to be a clear estimate of how big a chunk of the domestic drug market such drugs account for. While the government, as per a 2013 parliamentary report, says only 0.3-0.4% of drugs fell into this category, various industry reports have held the share to be as high as 25-40%. A few years ago, the CAG had reported that 15-31% of the drugs from different Armed Forces Medical Store depots were “not of standard quality”. Against this backdrop, the government moving to monitor drugs better through the use of technology seems to address a long-felt need. The Indian Express reports that the Union government will be implementing blockchain or distributed ledger technology to keep track of drugs purchased from its government e-marketplace portal. The report states that the technology will be implemented in about a year’s time for all state and central government hospitals. A proof of concept was conducted at the UP Medical Supply Corporation and the Director-General of Armed Forces Medical Services. While, at present, the government has no way of tracking if the medicines are coming from the same supplier—at the very best, it can check batch numbers—blockchain would allow hospitals to check details at each link in the value chain, from the stock to point-of-sale. With plans to bring in IoT (internet of things), the government can also check if the right temperature was maintained during delivery or not.

The technology works by creating a spreadsheet where all changes are registered, and parties can verify each step of the process and raise concerns in real-time. While the technology forms the backbone of digital currencies, of late, financial institutions have been using it for ‘smart contracts’, and the government has been implementing it for the land-registration process. Recently, distributed ledger system was used by Trai for SMS scrubbing (to check for SMS frauds and phishing attacks). The system can also be used in building a more secure health infrastructure, where even the patient can confirm the genuineness of the medicine, and the government can keep a track record of the entire process. More important, if successfully implemented, even private hospitals can be brought on board to check spurious drugs at all sources.

While the use of technology will certainly help check the menace of spurious drugs, there are a host of other actions that the government will need to undertake—from enforcing strict penalties on the spurious-drugs value chain to reforming drug-quality regulation to take care of the loopholes that exist in the current structure.