Demystifying Blockchain for Pharmacists

By Hesham Mourad posted 02-26-2019 08:29


Blockchain is one of the buzzwords that we keep hearing about with the promise that it is going to change the face of several industries including healthcare. Is that true? If it is true, then where does Blockchain technology fit in healthcare? To start let's explore the basic definition on Blockchain: “Blockchain is an openly-distributed incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value”1.

What does that mean: think of Blockchain as a huge decentralized database over a network of users and computers, with no single ownership. The network serves as a consensus to transactions, which prevents a single entity from creating or manipulating a fraudulent transaction. It is also totally transparent to the users, and now you have a basic understanding of the Blockchain 2.

So how is that different? Information held on a Blockchain exists as a shared — and continually reconciled — database 3. Some of the benefits of this design:

1-     The Blockchain database is not stored in any single location, meaning the records it keeps are truly public and easily verifiable. Also by being hosted by millions of computers simultaneously, its data is accessible to anyone on the internet.
2-     A decentralized network resists individual hacking attempts. By storing blocks of information that are identical across its network, the Blockchain network:
i)       Cannot be controlled by any single entity.
ii)      Has no single point of failure.

Where is Blockchain currently used?

The amount invested in Blockchain technology is comparatively small but aggressively growing 2. Examples include IBM and Microsoft incorporating Blockchain platforms in their customer support systems. Additionally, major companies are actively exploring the value of integrating Blockchain technology into their operations. Examples include:

  • Walmart: tracking vendor payment and digital shopping.
  • Starbucks: tracing beans from various countries.
  • American Express: customizing rewards for cardholders.

Where does Blockchain fit in healthcare?

Several case studies have been published about Blockchain in healthcare; the three basic concepts that support its use are 4:

1- Providing proof of work

2- Guaranteeing data integrity

3- Supporting an economic model

Areas where Blockchain can be utilized in healthcare that have been discussed in literature 4,5,6 :

1- Clinical trials and the management of trial subject consent: Blockchain can be used to increase transparency, auditability, and accountability.

2- Data sharing represents an area where Blockchain can be useful. Of course, privacy will always be a challenge.

3- Patient Records: Blockchain has the potential to make patients access to their healthcare data much easier.

4- Drug tracking from manufacturer to patients: Blockchain can help establish and maintain tracking record and chain of custody records from manufacturer to patient.

How might Blockchain affect the pharmacy world?

1- Focusing on one piece of the EHR, Blockchain would potentially be able to hold the complete medication history for each patient, and any updates or changes made by any provider or the patient would be captured and recorded securely in one place.

2- Pharmaceutical supply chain is another area that Blockchain can provide a lot of value to, also Blockchain can help overcome the increasing risks around counterfeit and unapproved drugs. As with device tracking, it is possible to define smart contracts for drugs and then identify pill containers, with integrated GPS and chain-of-custody logging 4.

Challenges associated with Blockchain use:
Any new technology is presented with challenges and Blockchain is not an exception:

1- Cost is one of the main challenges that currently face Blockchain technology adoption 7. With specific customization to each institution, the start-up costs are currently very high, even though on the long run, Blockchain promises long-term benefits with regard to productivity, efficiency, timeliness and reduced cost.
2- Additionally, even when operating, the system will not be without computing resources and an incentive for those participating in the computing network. A recent estimate suggested that Bitcoin’s computing network consumed the energy equivalent of 159 countries 9.
3- Privacy and security are one of the challenges that are associated with Blockchain 7. With the need to restrict and protect data in the healthcare industry, Blockchain technology cannot work in spaces with sensitive data until this challenge is met. In a recent tale of caution, 115,000 users lost access to $190M when a cryptocurrency exchange CEO passed away and his passwords were lost10. While this is not an issue with the blockchain technology, it does highlight the need for oversight of those operating systems interacting with this technology.
4- Speed and file size may limit blockchain’s reach into the healthcare environment. For example, Bitcoin transaction’s have been reported to take several hours to finalize 9. At this time, real-time updates to a blockchain medical record may not be realistic and large files or abstract data (like radiology images) would not be candidates for this technology11.

In conclusion:
Blockchain provides promising advances in multiple industries as well as in healthcare. But as with other technologies, careful consideration needs to be applied to provide the best use case for this technology at any institution.


Published on behalf of the Clinical Application Workgroup for the Clinical Application SAG:

Alec Huang, Pharm.D. Epic Business Intelligence Developer. Thomas Jefferson University Hospital. Philadelphia, PA.

Ben Iredell, Pharm.D. MBA, BCPS, Pharmacy Informatics Manager, Cedars-Sinai Medical Center. Los Angeles, CA.

Chad S. Stashek, Pharm.D., M.S., Clinical Informatics Pharmacist, Affiliated Faculty. Oregon Health & Science University. Portland, OR.

Hesham Mourad, Pharm.D., BCPS, BCCCP, CPHIMS, Medication Management Informaticist, Assistant Professor of Pharmacy. Mayo Clinic. Jacksonville, FL

John Siejak, Pharm.D., CPHIMS, Pharmacy Informaticist, Kaleida Health. Buffalo, NY

Lisa Starost, PharmD. Manager – Pharmacy Informatics and Program Director, PGY2 Informatics Residency. Indiana University Health. Indianapolis, IN

Tanya O. Ezekiel, Pharm.D., BCPS. Clinical Informatics Pharmacist. Prisma Health–Midlands. Columbia, SC


1-   What is Blockchain Technology? A Step-by-Step Guide For Beginners. Retrieved from: Accessed 1/11/19.

2-   Blockchain and Its Potential Impact to Healthcare and Pharmacy. Retrieved from: Accessed 1/11/19.

3-   Blockchain Identity Management, Part I. Retrieved from: Accessed 1/12/19.

4-   Liam Bell William J Buchanan Jonathan Cameron Owen Lo. Applications of Blockchain Within Healthcare. Mon, 09 Jul 2018 in Blockchain in Healthcare Today.

5-   John D. Halamka. Real Blockchain Use Cases for Healthcare. Wed, 11 Apr 2018 in Blockchain in Healthcare Today.

6-   Kevin A. Clauson et al. Leveraging Blockchain Technology to Enhance Supply Chain Management in Healthcare: An Exploration of Challenges and Opportunities in the Health Supply Chain Wed, 11 Apr 2018 in Blockchain in Healthcare Today

7-   Five Challenges Blockchain Technology Must Overcome Before Mainstream Adoption. Retrieved from: Accessed 1/13/19.

8-   Big things ahead for Blockchain in healthcare, new report shows. Retrieved from: Accessed 2/7/19.

9- Bernard Marr. The 5 Big Problems With Blockchain Everyone Should Be Aware Of. Accessed 2/10/19

10- Doug Alexander. Crypto CEO Dies Holding Only Passwords That Can Unlock Millions in Customer Coins. Accessed 2/10/19

11- RJ Krawiec, et al. Blockchain: Opportunities for Health Care. Deloitte Touche Tohmatsu Limited. Accessed 2/10/19




02-27-2019 14:30

Great topic and discussion! As a student that is interested in informatics, I am a huge proponent on getting healthcare to use blockchain technology. However, there is too many unknowns and limitations to the current technology. As the article mentions the ability to do proof of work is inefficient and consumes too much energy to make it cost-effective. I'm in favor to have proof of stake, but the ability to implement and use such a method would be ground-taking as it needs the have a truly decentralized database. A question that isn’t addressed in this article is how and who will bear the cost and process of decentralizing our healthcare system? If a singular healthcare system did implement a blockchain service how is it any different to having a centralized database that is vulnerable to attacks?

02-27-2019 09:12

​Something odd with Connect...
I posted the long comment below.

Dennis A. Tribble, Pharm.D., FASHP

02-27-2019 09:08

I am glad to see this being discussed.

One of the temptations on a relatively new technology like this is that it can seem attractive in its own right. Like any other technology, blockchain is useful only to the extent that it solves problems for us in our practice. It will be important for us as pharmacists to distinguish between the hype and the reality.

​I just attended sessions at HIMSS on blockchain, especially on security. What they had to say conflicts somewhat with what is said here.

The first point they made was that there is not one large blockchain. There are many blockchain systems pointed at specific business needs, and business needs should drive both the development of the consortium of users of the blockchain as well as the design of the blockchain system itself. They described the hardest part of building out a blockchain is architecting and implementing the consortium of trusted users who will use the blockchain system.

The second point they made about blockchain was that basing healthcare blockchain models on cryptocurrency systems was unsustainable.

The third point they made was that blockchain systems are not inherently secure; "you have to bring your own security".

  • Blockchain nodes are immutable, so the nodes cannot be changed, that is true. And those nodes are distributed in several ledgers.
  • Immutability is not security. As was said in this blog, all information is publicly available. So ePHI and PII must not be stored directly in a blockchain because they could be seen by anyone. That would represent unauthorized disclosure. The presenters referred to these as "toxic identifiers".
  • Security of data in a blockchain has to be built into the blockchain system by the consortium of users that subscribes to the block chain.
  • It was also noted that, from a HIPAA perspective, the security of the blockchain is only as good as the weakest member of the consortium. A privacy breach at one subscriber to a blockchain is a breach on the entire chain, unless the blockchain is specifically designed otherwise.
  • The result of this is that these nodes contain pointers to ePHI and PII in the private systems of consortium members that can be referenced on those systems.
  • One result of that implementation is that there is no guarantee that any subscriber to the blockchain consortium will not delete a record to which such a pointer is aimed.
There is no doubt in my mind that there will be a multiplicity of blockchain systems that eventually drive healthcare practice. How those are built, who uses them, and how they handle ePHI and PII remain issues to be resolved.

One obvious application might be the storage of "T3" transactional information in a national database. Other, perhaps, than price, none of the data would be considered to be "private" and such storage would permit development of a number of features currently lacking in our current traceability systems. Perhaps the 2023 database required by DSCSA will be a blockchain. Perhaps not. It will be interesting to see.

02-26-2019 19:17

Great write up!  Curious what other applications specific to pharmacy where blockchain could have an impact.  Thinking chain of custody for controlled substances?  EPCS?  340b accumulation?