You are currently viewing Blockchain: Practical Solutions for the Pharmaceutical Supply Chain (Part III)

Blockchain: Practical Solutions for the Pharmaceutical Supply Chain (Part III)

This blog-post is the third part of an ongoing series based on our in-depth report Blockchain 2020: A Practical Guide to Blockchain Solutions for the Pharmaceutical Supply Chain The first part introduced the current problems supply chain is facing, and the second part was an introduction to blockchain. Today we will have a look at the different forms of blockchain-networks, explain what smart-contracts are, and conclude with the unique value proposition for the supply chain.

The full report can be downloaded here.


Blockchain can be implemented in many different ways. There are three groups of networks, depending on the degree of decentralisation, government and access management.

Public Networks
A public network is truly decentralised and based on the rules of open source software; anybody can download the software protocol, access the platform and view and access records.

Private Network
Private blockchains in contrary are centralised and maintained by a single entity that manages access to the platform and restricts the permission to read or write data.

A consortium blockchain is a hybrid form between the public and private blockchain model. It is a partially decentralised platform—instead of allowing anyone with an internet connection to access the network or letting a single entity have full control, a few selected participants are predetermined to control the consensus process.[1]
The two biggest consortia that have emerged bring together industry leaders and regulators to create a unified framework, to develop the technology and to solve industry-relevant problems.

Hyperledger is a global collaboration, hosted by The Linux Foundation, and includes leaders in finance, banking, Internet of Things, supply chains, manufacturing and technology. They aim to develop scalability and reliability for industry-scale applications.[2] Another important consortium is R3, which brings together more than 200 companies, regulators and trade organisations.


Blockchain technology has immensely developed since its inception, and one of the most interesting concepts are smart contracts. A smart contract is a tamper-proof piece of code, hosted on the blockchain, that represents a contractual agreement and can autonomously execute upon external inputs.
A smart contract could be, for example, an agreement between seller and buyer about the delivery of some goods. The contract could function as an escrow and withhold payment until the goods have been delivered, as well as automatically release the payment when some real-world event, such as the scanning of a barcode in a warehouse, triggers it. Smart Contracts are arguably one of the most fundamental drivers behind blockchain development as they promise automatization of a wide range of processes


The unique characteristics of blockchain promise to solve a whole series of problems in the current supply chain landscape. Its decentralised nature in combination with military-grade encryption generates trust and security. The easy accessibility and non-destructive way of saving changes allow for auditability and more transparency while smart contracts promise to automate a great deal of business logic and supply chain processes.

The next part will look at practical applications and real-world examples of blockchain technology in the pharmaceutical supply chain.


Leave a Reply