At Finboot, we recently hosted a conversation between Nish Kotecha and Dr. Iain Moore , delving into the pharmaceutical supply chain, regulatory landscapes, and the critical role of traceability in ensuring drug safety. But who are these experts?

Nish Kotecha is an impact and technology entrepreneur, journalist, and seasoned investment banking professional. As the co-founder and chairman of Finboot, Nish has been a driving force in pioneering enterprise and innovation on a global scale.

Dr. Iain Moore, an industry expert with over 40 years of experience, has dedicated his career to advancing standards, improving supply chains, and emphasizing the importance of traceability. Trained as a chemist — and proudly declaring, “Once a chemist, always a chemist” — Dr. Moore has spent 25 years specializing in pharmaceutical excipients, the inactive yet vital ingredients in medications. The components are critical in drug formulation and delivery, underscoring his commitment to ensuring that what we consume is both safe and effective.

The Pharmaceutical Landscape

The pharmaceutical industry is vast, generating nearly $2 trillion annually in revenues, and its importance became even more evident during the COVID-19 pandemic, where pharmaceutical brands took center stage. Public concern about drug safety and trust reached new heights, sparking questions about the contents and reliability of the medications we are taking. How do we ensure what we’re putting into our bodiescan be trusted?’”

These questions highlight the critical importance of regulations. As Dr. Moore explains, “The pharmaceutical industry is very heavily regulated. You just can’t make up a drug product, put it on the market, and claim that it has a therapeutic effect.” This rigorous framework, enforced by government-authorized regulatory bodies, ensures that drug products are safe, effective, and meet the highest standards of patient care.

Developing a drug involves nearly a decade of work, starting with synthesizing the active ingredient—whether chemical or biologic—and progressing through extensive clinical trials. These trials, beginning with animal testing and culminating in human studies, aim to demonstrate both safety and therapeutic benefit.

However, exceptional circumstances like the COVID-19 pandemic saw governments and industry working together to accelerate these processes; vaccines were approved in record time without compromising safety, demonstrating the ability of regulatory frameworks to adapt in emergencies.

Supply Chain and Traceability in Pharmaceuticals

The pharmaceutical supply chain is complex, involving various stakeholders from raw material suppliers to manufacturers and distributors. Given the industry’s stringent regulation, ensuring traceability is essential for maintaining drug safety and efficacy. Traceability involves tracking each ingredient from its origin through production to delivery, ensuring transparency at every stage.

Good Manufacturing Practices

Good Manufacturing Practices (GMP) play a key role in this. Dr. Moore highlights that GMP’s origins date back 60 to 70 years, when it became clear that drug products had to be made hygienically and safely. According to the World Health Organization, GMP is a quality assurance process that ensures medicinal products are consistently produced and controlled to meet the quality standards required for their intended use and in accordance with the product specifications.

While GMP regulations are well-defined for drug products and active ingredients, excipients (inactive ingredients) are only regulated in countries like China and Brazil. This places responsibility on pharmaceutical manufacturers to ensure excipient compliance, guided by GMP standards.

Nish Kotecha adds that the power of traceability lies in connecting producers, regulators, and consumers, ensuring every step is verifiable. In an industry where safety is crucial, traceability technologies are essential for building trust and ensuring compliance.

Challenges in tracing ingredients through the supply chain

One of the primary obstacles facing the pharmaceutical industry in tracking ingredients throughout the supply chain is the reliance on outdated and inefficient data management systems. Many players in the sector still rely on hybrid paper-based systems, where digital records are simply scanned copies of paper documents. This approach raises serious concerns regarding data integrity and traceability. Paper systems, while tangible, lack the transparency and security offered by modern digital solutions. For example, in pharmaceutical supply chains, ensuring that each ingredient is accurately tracked from manufacturer to distributor is a complex process. Ingredients often pass through multiple intermediaries before reaching their final destination, and each transition introduces the potential for errors, fraud, or contamination.

A significant challenge is the issue of authenticity, particularly in ensuring that digital records are tamper-proof. As Iain mentions, in the past, there were concerns that digital data could be altered without leaving a trace, but modern technologies like blockchain have successfully addressed this issue. However, implementing such technologies on a large scale in the pharmaceutical industry requires overcoming regulatory hurdles, as the industry is highly regulated, and adopting new systems could take time. Despite these challenges, the push for greater transparency and efficiency is increasing as the risks of ingredient adulteration—such as the introduction of toxic materials—remain a real and dangerous threat.

Conclusion

The lack of transparency has often been masked under the banner of commercial confidentiality, but in industries that directly impact human health, such practices are no longer acceptable. The consequences of adulterated ingredients, such as fatal incidents involving toxic substances in over-the-counter medicines, underscore the importance of trust and visibility in the supply chain.

Digital solutions, such as blockchain technology, offer a path to solving the industry's transparency problems. By creating a decentralized, immutable ledger of all transactions, blockchain enables the secure tracking of ingredients from their origin to their final use. This provides pharmaceutical companies with the ability to trace the journey of every batch of ingredients, ensuring that they meet safety and quality standards. Also, it allows companies to share essential data with regulators and consumers without revealing sensitive business information, thereby fostering trust in the product.

Nish emphasizes that, in a world where industries like pharmaceuticals are pivotal to human survival and health, transparency is the key. We must be sure that what we are putting into our bodies can be trusted. For that, we need trusted data.

The future of the pharmaceutical industry hinges on greater transparency, and the technology to make that happen already exists. Adopting a digital ledger system can prevent catastrophic events, such as the injection of adulterated products. That's why we developed the MARCO Track &Trace platform—that solves exactly this problem.