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Novartis to go live with blockchain network in 2020


Last week, the heads of blockchain for Novartis revealed that they plan to implement the technology throughout the business. Appearing on CNN, Marco Cuomo and Daniel Fritz shared the use cases and challenges of blockchain in pharmaceuticals.

Ledger Insights interviewed Cuomo and Fritz last year when Novartis was mainly working on its Innovative Medicines Initiative  (IMI) partnership. The two also introduced how the firm filters out use cases which aren’t suited to blockchain.

Credentialing for pharma

Has anything changed in the last year? While IMI, the world’s largest public-private program for health investments, is still a priority, Novartis is now developing solutions in credentials and automation.

“We are very focused on verifiable credentials,” said Cuomo. “Everywhere you need a stamp to approve something, we could improve that with something more digital, machine-readable, and improve some areas in supply chain and some areas in clinical trials.”

With the sector “becoming more and more regulated”, there is the challenge of digitizing manual processes. Machine-readable credentials are but one aspect of this, whereas Novartis hopes to use blockchain to automate more generally.

“So we look into blockchain where we can help to automate in the business,” Cuomo continued. Referring to the firm’s several pilots: “We start small, not with the full business network of thousands of participants, to learn how it works in business. So we are now at the point where we want to go live.”

“That is our big goal in 2020, to have a productive, blockchain network out there,” he said.

Not all use cases are created equal

But filtering out use cases continues to be necessary. “Every time there’s a pain point where we don’t have to involve a lot of external parties or an ecosystem where a standard, cloud-based or centralized database solves the problem, then it’s not an issue [for blockchain],” explained Fritz.

“We have to find a problem that requires ecosystems and where there is not just an opportunity for some percentage increase; we are looking for transformational use cases […] ultimately disruptive in terms of business models,” he added, noting that a 5% ROI by implementing blockchain doesn’t really make sense.

In fact, the two shared that 90% of the pain points they consider turn out to be better suited to other methods.

Future blockchain projects?

Fritz revealed that Novartis is now working with the Swiss Blockchain Federation. Plus: “Longer term, there are other use cases […] patient data in clinical trials, accelerating innovative medicines, and sharing or potentially streamlining research with patient data.”

Meanwhile, Cuomo commented more on the big picture: “I think, in the long term, when we really understand the technology in business, then there comes new business models that will be, in pharma too, disruptive.”

Novartis has around 20 people dedicated to blockchain work, 5-10 on the technology side and 10-15 on the business concept side. But the real investment, according to Fritz, is the firm’s collaborative work with universities and partners – blockchain is a “team sport” after all.

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