- Global Pharma News & Resources

Distributed Ledger is the future of data storage and security in a supply chain

Distributed Ledger is the future of data storage and security in a supply chain


Distributed Ledger, even though a new entrant in the complex pharma supply chain ecology, has taken data connectivity and traceability to a new level. Here’s exploring what it is in details.
  • Author Company: TrackTraceRX
  • Author Name: Christian Souza
  • Author Email:
  • Author Website:
Editor: Kaustav Sarkar Last Updated: 08-Dec-2020

We have spoken in details about various aspects of traceability in the pharma supply chain- serialization, hierarchical data, aggregation and more- all meant to save drugs from the counterfeit market. However, owing to the ever-changing dynamics of the pharmaceutical industry and its growing complexities, it would be unfair to stick to certain technologies over time. So, as we approach the future of traceability, we have to adopt technologies designed considering the changing ecology and demands of the drug supply chain in mind.

The main aim of introducing traceability, as per DQSA act, is to eliminate the counterfeit drug from the mainstream supply chain. But mere serialization and traceability processes are not enough, pharma participants must also look into introducing the best data repositories, simply because of the fact that the pharma industry involves multiple stakeholders with different setups, software and willingness to maintain the security of drugs.

Read more on Unit-level Traceability

Distributed Ledger, even though a new entrant, seems to be the only solution at large. We might not have acknowledged its importance in the past, but the threat from the counterfeit mafia intensifying, especially in the times of COVID, supply chain stakeholders have no other option but to appreciate the technology and the purpose of Distributed Ledgers. So, what is it?

Let’s start with defining it.

What is a Distributed Ledger?

If you notice, we mention ‘data repositories’ in our introduction and we mean it; Because unlike a central repository which has all the details of the serialized drug consignments that pass hands, data repositories have a different role to play all together and therefore define different sets of repositories at different stages. Now to define it in the words of Investopedia:

“A distributed ledger is a database that is consensually shared and synchronized across multiple sites, institutions, or geographies, accessible by multiple people. It allows transactions to have public "witnesses". The participant at each node of the network can access the recordings shared across that network and can own an identical copy of it. Any changes or additions made to the ledger are reflected and copied to all participants in a matter of seconds or minutes. A distributed ledger stands in contrast to a centralized ledger, which is the type of ledger that most companies use.”

In other words, distributed ledgers can be used to record static data, such as registry and dynamic data, such as transactions.

Benefits of distributed ledgers

The main advantage of Distributed Ledger technology is that it guarantees traceability and transparency throughout the logistical transition of the drug from the drug manufacturer to the delivery location. It helps in controlling the progress of serialization on the side of producers, distributors and repackagers. It provides a decentralized database linked with smart contracts. The best part about the distributed ledger, unlike conventional database, is that it can not only be accessed by stakeholders, but also by the patients. Compromising individual data ledger is a difficult job, which is why counterfeiting becomes even more difficult.

It also accelerates the VRS process and ensures that it is audit-ready, storing essential shipping and storage information. This table by PeerJ summarizes the benefits of Distributed Ledgers in a better way:







Distributed ledger technology rises effectiveness of cooperation of all representatives involved into a supply chain through existing total trust


Guarantee full audit of a data log (the opportunity to trace the source of information)


Cut the number of intermediaries of a deal


Defends the information in a data log from crashes and attacks as all data are saved in a decentralized way


Optimizes the work and lower logistics costs through all the supply chain


Increases safety of goods, decreases the level of losses in goods delivery and storage

Production transparency

Guarantees transparency and authenticity of information about producers of goods and the process of distribution

Delivery transparency

Guarantees total transparency of medicines supply chain and impossibility to change data


Guarantees authenticity and quality of goods returned

Rights of a consumer

Guarantees the rights of consumers providing total and undeniable information about the origin of goods to be sold in retail

Custom clearance

Decreases the share of gray (illegal) import and restricts the possibility of fraud


How is the information stored in a Distributed Ledger?

There can be individual distributed ledgers at every stage of the pharmaceutical supply chain, each storing different types of data. For instance:

Pharmaceutical production: At this stage, information on the number of inventories are stored. Requirements can be formed for the production of type and quantity of the products used for production. The lab-testing requirements are also registered, apart from the result of the lab tests.

Stage of distribution (storage, transportation, wholesale, retail): The primary thing that is stored is the unique identifiers of the drugs that are being transported. On more general terms, application from the suppliers for a particular drug is also stored. When the drug changes hands, the labelling data, supplier and customer of a batch of pharmaceutical products are stored. In case, the drugs need a particular temperature for storage, even that is recorded and maintained.

Medical dispensing: From prescriptions to doses, everything is detailed for every drug. Information on the labelling of drugs is also stored, apart from information including drug indications, side effects, contra-indications, interactions with other drugs and more. This stage can also have packager inserts saved in the distributed ledger.

Logistics: From temperature maintenance inside a container as per drug requirements and alignment with the FDA rules is supervised adeptly with a distributed ledger. The blockchain technology that is being used behind it ensures that the protocols for logistics and transportation are followed in a drug supply chain. Suppose there’s a temperature failure in transit, it immediately appears in the ledger for the distributors to take action. They can even decide whether they wish to receive the consignment or not in the case of a storage-sensitive drug consignment.

Distribution Ledger guarantees the continuity of information, data accessibility and integrity. It represents the source of transaction information that is shared among all users in a distributed network of devices, easily accessible by everyone in the supply chain including the end-users. By using the distribution network technology, every transaction performed within the network is recorded and stored, which enhances the visibility of the drugs, eliminating the dependency on third parties such as payment processors.

This brings us to the most crucial part of the essay, establishing a deep connect between technology and drug integrity. It has already been proved how modern technologies such as VR-enabled multiscanners have the potential to transform the pharmaceutical industry. But, Distributed Ledger Technology is one of the rapidly developing areas in medical data sharing that is influencing the way data is being shared in a drug supply chain. While data management is the primary focus of discussion for distribution ledger, it must not be ignored that it is also less prone to cyber attacks and fraud, unlike centralized databases. Even if the ledgers are subject to such an attack, they do not allow single-point failures, probably making them the safest data reservoirs.