Big Pharma allured by the endless possibilities of Blockchain Technology

blockchain

Companies are finally embarking on the idea of ​​distributed ledger technology (DLT), or at least can now see its merit and potential. The next step will be the beginning of concrete use of this technology in real-time instances. Of course, the brutal year that most crypto-currencies have witnessed has done nothing to improve the overall credibility of the technology. Due to market volatility, the idea of ​​blockchain as a technology has been receiving increased attention, instead of the confusing and enriching stratagems that have emerged in recent years. Most companies that flourished overnight, during the Bitcoin explosion between 2016 and 2017, are now starting to show signs of their struggle to keep up their promises. One such company is ConsenSys, a blockchain software company originally established in Brooklyn, New York. They have been developing services and applications based on Ethereum since 2015 but have recently announced restructuring and austerity measures to save money, laying off more than 10% of their workforce. However, ConsenSys is far from being the only victim of the crypto crisis.

The KCS System

Konfidio group, based in Berlin, seems particularly well prepared for the race. One of their companies uses what is known as Konfidio Contract Solutions, or KCS, to stem the flood of losses that represents millions of multi-year contracts at the company level. They enter production with Fortune 500, Novartis. KCS is a decentralized system that aims to improve order lifecycle management, pricing agreements, coded legal agreements and automated value settlement of managed service consumption. As companies attempt and fail to reconcile the fine print of multi-million dollar contracts, considerable waste of time and money is wasted. KCS promises to be the solution to this problem and can potentially save millions of businesses.
Above all, it provides executives with a real-time financial and operational dashboard. This means that budget overruns, audit fees and an important reconciliation back office that generates exorbitant legal fees are all problems of the past.

Novartis, An Investor In KCS

Novartis, the giant of pharmacy and health, invests in the capital of Konfidio. The marriage between health care and DLT may seem unconventional. However, careful inspections, mismanagement, and bureaucracy are among the biggest problems in the industry especially for those dealing with data-centric contracts. Today, everything is in a silo. Everyone has their own system. Loss of data is taking place increasingly and there are many delays. Centralized systems have had their day in the sun, but the sun is setting and the new dawn is a decentralized technology. Novartis is eager to stop dealing with multiple versions of the truth in its customer-supplier relationship. This creates inconsistencies, delays payments and imposes a financial provision which, in turn, affects the performance of the CFOs. Ultimately, the scourge of Novartis requires costly and time-consuming reconciliation efforts within its multinational organization. These new solutions seek to change all that. Scott Mason, Director of Global IT Operations at Novartis, explained at the recent Blockchain Summit on Leadership in Basel that they have tested the system and believe they can solve some of the major issues in managing external contracts by leveraging blockchain technology. Dr. Mervyn Maistry, CEO of Konfidio, added that Blockchain technology is powerful enough to replace SAP systems in 10 to 15 years. SMEs and businesses will have an alternative to ERP systems that are overloaded, expensive, and uncomfortable for users. While Novartis and Konfidio are paving the way for the future integration of DLT in the pharmaceutical industry, it seems obvious that more will follow. What is left to be seen, however, is the solidified proof of use of the blockchain and DLT technology in real-time instances, especially with regards to the pharmaceutical industry. None of the organizations that are part of big pharma have actually demonstrated its value. But recent events indicate that this is not far off.

About Anand Sai 84 Articles
Anand Sai has worked in the field of market research as an analyst and a consultant and has also operated at several leadership positions. He has an enormous experience with respect to the compilation of high-quality market research reports and boasts over six years of experience in end-to-end project management. Anand is a dependable voice in the market research field and has been named in some of the top industry publications. He is also a travel junkie and loves to explore new places with his friends.