Pfizer, Biogen led working group demonstrates proof-of-concept

Blockchain in healthcare updates

Pfizer and Biogen led Clinical Supply Blockchain Working Group demonstrates PoC

Clinical supply chains suffer from many of the same challenges (lack of transparency, inefficient data management, need for auditability, etc) as commercial supply chains but have less parties involved, which make it easier to implement a blockchain. The Clinical Supply Blockchain Working Group is comprised of Pfizer, Biogen, AstraZeneca, Merck, GlaxoSmithKline, Thermo Fisher, IQVIA, UCLA, Deloitte, Marken, Bracket, and Almac, and they’ve published a white paper here detailing their work to date and a bit on the future direction. LedgerDomain, the company providing the technology for this solution, is working with UCLA on one of the projects under the DSCSA’s blockchain focused pilot.

Patientory raises $5.2m round led by R/GA Ventures

Patientory was the first major healthcare initial coin offering (ICO), at the time describing itself as a “blockchain-based distributed electronic medical record storage computing platform,” and selling a cryptocurrency (“PTOY”) that would power its network. Patientory raised $7.2m off of this vision in tandem with an exuberant cryptocurrency market.

Since then Patientory, like all healthcare ICOs, has had a mixed record. Patientory’s currency, PTOY, sold as a way to pay for storage of medical records on its network, has been mostly unusable for its lifetime and sunk from a listing price of $0.65 to less than $0.01 with volumes of trading (a critical measure of liquidity for investors) falling to similarly low levels. A quick analysis of the smart contract of Patientory’s currency shows that there is little usage of PTOY beyond trading. The Patientory Association’s Github hasn’t been touched for about a year.

But, nonetheless, Patientory Inc (the for profit company) has launched a beta mobile app with 350 users, which is more than most healthcare ICOs. Importantly they established a non-profit association which controls the proceeds from Patientory’s token sale. From the above article:

She [McFarlane] added the remaining 45 percent of the ICO funds are under the nonprofit’s management

That is a laudable move to make because equity holders and token holders have diverging interests and token holders have almost always ended up getting a worse deal when there is tension between those interests. One way that this issue might be resolved is to separate those interests into two entities: a neutral non-profit that governs a network and develops its technology, and a profit seeking company building on top of that network. Most big public networks (Ethereum, Tezos, Cosmos, etc) have a non-profit foundation that manage proceeds from their token sales and advocate for adoption, though there are some notable exceptions (EOS’ and Ripple’s Ripple Labs are for-profit companies).

SimplyVital Health settles with the SEC

SimplyVital bills itself as a HIPAA compatible blockchain for healthcare and in 2017 raised $6.3m through an ICO. They came under scrutiny of the SEC for not registering their token offering with the agency and not taking steps to identify whether all of the participants in that token offering were accredited US investors. In April of this year they had returned the bulk of capital to investors. The SEC took notice of their remedial actions, in the end issuing a settled cease and desist order and taking no further action. You can read the SEC’s letter here and SimplyVital’s statement here. Some commentary from actual lawyers (I am not one!) can be found here.

What I'm reading this weekend

“Paid to Produce Data:” Research Participation as the Labor of Generating Valuable Health Data

Would love to hear feedback and commentary on the above piece that I co-authored.

Tracking the rise in premium contributions and cost-sharing for families with large employer coverage

Pairs well with the The National Business Group on Health’s annual survey. Some highlights between these two reports that stood out to me:

  • Total health spending by and on behalf of a family of four with employer coverage tops $22,000

  • On average employers contributed $15,000 of that.

  • 49% of employers are planning to deploy at least one advanced primary care strategy in 2020

  • 34% said they were rolling out on-site primary care or near-site health centers

  • 51% will offer more virtual care programs next year

  • 85% of respondents rate high-cost drugs as the number one or two most concerning pharmacy issues

What blockchain opportunities does this create?

Bitcoin… on Ethereum!

The folks at Keep and Summa launched a token called tBTC on Ethereum that is equivalent to, and can be redeemed for, 1 Bitcoin. That has been done in the past in a centralized way (see wBTC) but what’s unique about this is that tBTC uses a clever model involving cross-chain communication and collateral to keep it decentralized . The technical spec can be read here.

Why enterprises should care: cross-chain interoperability efforts are maturing and there is much to learn from bleeding edge projects like these.

Electric Capital Developer Report (H1 2019)

This is quickly becoming the industry standard for data about developer activity in the crypto space. The takeaways for me were:

  • Ethereum has the largest base of contributors by far (~1200) which is ~4x times that of the runner up, Bitcoin.

  • Following up those two are EOS (224), Cardano (~125), and Monero (~100).

  • Many projects have a group of developers that frequently contribute, but often times this group is much smaller than you would expect.

  • Test nets and launches drive engagement

  • Infrastructure and decentralized finance projects are attracting the most new developers

  • We have a lot of room to grow!

Big Data, Big Tech, and Protecting Patient Privacy

Chinese Central Bank says it is close to releasing its own cryptocurrency

New Business Network: Trust Your Supplier

Blockchain in healthcare updates

New Business Network: Trust Your Supplier Network

Trust Your Supplier is a network “designed to improve supplier qualification, validation, onboarding and life cycle information management.” It look like IBM and Chainyard cocreated this network, and it also boasts Anheuser-Busch InBev, Cisco GlaxoSmithKline, Lenovo, Nokia, Schneider Electric and Vodafone as founding members. Trust Your Supplier allows organizations within their network to reuse verified documents, which reduces administrative overheard and shortens onboarding and procurement times.

The idea is similar in concept to that of the physician credentialing use case of ProCredEx, or the anti-money laundering use case of Cambridge Blockchain. In this family of use cases a blockchain is used to immutably timestamp the verification of information by one party such that others can reuse that information in their work flows. Sharing credentials in this way is particularly valuable in domains which have standardized artifacts, rules, and validation checks for due diligence processes. One such area is in the on boarding of suppliers in pharma where there are a range of GxP guidelines and regulations to comply with.

So, it is not surprising to see GlaxoSmithKline among the founding members. But one has to ask what supplier information would pharma giant GSK have to share with beverage giant Anheuser-Busch InBev or energy management company Schneider Electric. Perhaps the answer is nothing and instead this press release was an announcement intended to garner interest in others to join the network.

What I’m reading this weekend

Novartis’ subsidiary receives an uncommon public rebuke from the FDA for data manipulation

AveXis, a gene therapy company Novartis acquired in mid-2018, disclosed to the FDA that it had discovered that data which had been submitted to the FDA in a bid for approval had been manipulated. This was only revealed a month after the gene therapy in question had been approved. Specifically, data generated in an earlier animal testing procedure had been manipulated, but as far as we know no data concerning human research subjects was manipulated. The FDA in turn issued a public statement rebuking AveXis and is considering action they can take, including criminal or civil penalties. This makes a good case for the usage of a blockchain to verify the integrity of sensitive data. The FDA has a pilot on going for the usage of emerging tech (including but not limited to blockchains) to comply with DSCSA, I’d like to see a similar construct for usages of blockchains in clinical trials.

Putting open source tools to work: tokenizing your time with a few clicks

Ross Campbell had an interesting tweet storm where he demonstrated how in a few clicks you could create tokens redeemable for your services and sell them. If anyone wants an hour of his “legal engineering” services you can now buy them on Uniswap. The cool thing is that he did this by leveraging open source tools like MetaMask (wallet/UI), OpenLaw (“legal protocol” for blockchains), and Uniswap (exchange). So, anyone reading this could do something similar if you were willing to learn about the above tools.

The blockchain community is full of open source tools like the ones referenced above. These are interesting because they provide building blocks that you can easily leverage, either building on top of something, or combining several “building blocks” to enable something entirely new that wouldn’t have been possible otherwise, like what Ross did. This landscape is ripe for “combinatorial innovation” and makes me excited for what the community will produce in the future.

CMS will cover CAR-T cancer therapies

A cool project allowing for selective ZKPs was built at a hackaton last week

Brush up on Ethereum 2.0

An EHR project launches their own public blockchain and several blockchain communities debate how to fund development efforts

A quick note

Hey everyone -

The new platform is live. There are a few things to be worked out still (I think some links are broken, and I need to retire the old newsletter service) but we’re mostly there. My newsletter can be found on SubStack and you’ll get it in your inbox every Sunday from this address. Otherwise you don’t have to do anything.

Blockchain in healthcare updates

MediBloc, a Korean blockchain enabled EHR, launches a public blockchain

MediBloc’s mainnet “Panacea” was launched on the 31st as their genesis block was minted. Panacea is a public blockchain using delegated proof-of-stake and leveraging TenderMint. It is similar to EOS in style, and although blocks are being produced, as far as I can tell you can’t actually use it for anything right now. In the future MediBloc hopes it will be used for all the things you would expect a blockchain is used for in an EHR project: access management, immutable references of consent, verifiability of patient data, facilitating payments, etc.

But those are all things that can be achieved by using an existing blockchain. So why did MediBloc choose to launch their own public blockchain?

  1. Creating a public blockchain is a necessary, but not sufficient, step towards "decentralizing” a project.

  2. Separate chains give you have more autonomy over network parameters (e.g you can use whatever consensus mechanism you would like).

  3. Moreover, you are able to scale more because by decoupling from the computational overhead that other projects on a public blockchains generate.

Unless you need all three of these things, and your own currency, I don’t think it makes sense to launch your public blockchain. A handful of projects built on Ethereum have some kind of decentralized governance (e.g MakerDAO), but they don’t need the autonomy that comes with having their own blockchain. On the other end if you simply wanted more autonomy over the blockchain you’re built on, but didn’t care to be decentralized, you would just run a private blockchain. It remains to be seen whether MediBloc can get others to run nodes (right now they run all 21, I think) and build on their new blockchain, as well whether they can successfully decentralize their governance process.

Orderly Health and BurstIQ team up to launch a provider data management product

Orderly Health is bringing its expertise in AI and BurstIQ is lending its blockchain platform to create a provider data management system. It’ll be interesting to contrast this solution with that of the Synaptic Health Alliance, and I’m curious if the blockchain solution they’ve created is useful standalone or if it requires a network of users to provide value.

Shoppers Drug Mart, one of Canada’s largest pharmacies, is expanding its medical cannabis traceability pilots

Cannabis was legalized in Canada in 2018 and efforts are underway to create blockchain enabled supply chains to support the traceability requirements stipulated by the Canadian federal government. Several producers, most recently Flowr, have joined a pilot by Shoppers Drug Mart to that end.

Retail pharmacy giant Walmart applied for a stablecoin patent

The stablecoin Walmart applied for a patent for could be pegged to the dollar, or any currency, and it is intended to provide a “low or no cost” way of storing funds, similar to Libra. Moreover, its usage might be restricted to only selected retailers or partners. A stablecoin powered payment system could reduce b2b transaction fees by up to 60%, and b2c transaction fees by a commensurate amount. Any reduction in these fees would be extremely valuable for the retail giant which has $500b in annual revenues. Further, managing a stablecoin is an extremely lucrative business if you can get scale, which is one reason why Goldman Sach’s CEO said to assume all major financial institutions were looking at the potential of stablecoins. Perhaps we’ll be paying for prescriptions in WalCoin sometime in the future.

A wellness company is partnering with a crypto-payments company to create a reward program

Kinesis, an ICO which is also creating gold and silver stablecoins, invested in and partnered with Rejuvenan, a digital wellness company. The idea is that Rejuvenan will use the “operational infrastructure” of Kinesis to create its own rewards program to incentivize healthy lifestyles. It’s not clear what the rewards program of Rejuvenan will look like, but presumably Kinesis invested in Rejuvenan to drive usage of their native currency. In general I don’t think anyone has cracked the code of generating sustainable value with a token and driving behavior change at scale, so I would advise companies to use USD denominated stablecoins.

Molecule’s Scientific Lead discussing why new business models are needed in drug development

What I’m reading this weekend

Truffle, one of the most popular blockchain dev tools, is expanding beyond Ethereum

Truffle is a suite of tools, borne out of ConsenSys, for developers to more quickly deploy blockchain solutions. Until now those tools have been restricted to Ethereum, but Truffle will be offering tools for Hyperledger Fabric, Tezos, and R3’s Corda in the future. The inclusion of Tezos in this mix is a sign of its growing popularity as a smart contract platform. Moreover, Truffle has a stated goal of building for enterprises, so these tools will help accelerate enterprise adoption of blockchains.

(disclaimer: I work for ConsenSys Health)

Microsoft’s recent blog post on leveraging Ethereum for machine learning

The tl;dr of this is it is a basic form of a neural network which runs entirely on-chain. Using a blockchain for this process enables more collaborative and transparent forms of training an AI. I’m keenly watching this space for future developments.

Zooko Wilcox pens a letter asking for the Zcash communities’ support for a new dev fund

Several public blockchain communities are in the midst of contentious debates on potential models for sustainable development going forward. One in particular, Zcash, has historically devoted a % of new issuances (called the “Founder’s Reward”) to professional teams that work on the underlying technology, educate regulators, and perform general business development. With these funds Zcash has received some world class cryptography work and lobbying for favorable treatment from regulators in the US. On the other hand, as Wilcox points out, all of the value that comes from the Founder’s Reward is derived from, and potentially dilutes, coin-holders. That’s why the Ethereum community vociferously pushed back against a similar proposal to fund ~$2m worth of development for the next 18 months.

Zcash’s Founder’s Reward is set to sunset soon (it was slated to continue only for the first 4 years), and the community will need to decide whether or not it will renew it. Zooko Wilcox, founder of Zcash and cryptography pioneer, wrote a letter to the community giving context and asking them to renew the Founder’s Reward. It is a good letter, and the debate is emblematic of a broader discussion around funding that will remain a constant point of discussion and contention in the blockchain space.

The VDF Alliance and AWS back a $100,000 competition to solve an esoteric cryptography problem

Genealogical genetic tests, a threat to biomedical research?

New Business Models to Accelerate Innovation in Pediatric Oncology Therapeutics

A look at blockchain consortia in healthcare

Hi everyone -

I’ve decided to move to another newsletter service (SubStack). That won’t mean much for you, but in the near future you’ll be receiving emails from, and the newsletter will have a slightly different look to it. I’m making this change mostly because people were having difficulty signing up to the service I was using previously. I also want to reiterate that this newsletter is, and will remain, free.

In light of this change I am also taking the opportunity to ask for other feedback. You can sent comments directly to me (reply to this email, or send me a message at I take the time to read all the feedback I get, and I really appreciate it.

Blockchain and healthcare updates

Hashed Health’s recent newsletter focused on blockchain and healthcare consortia

Hashed Health always has insightful content and this piece didn’t disappoint. They identify seven major consortia:

  • Synaptic Health Alliance

  • Professional Credentials Exchange

  • Health Utility Network

  • Coalesce

  • RemediChain

  • MediLedger

  • Melloddy

They created a great spreadsheet detailing the members of each consortia, the design pattern (“Data synchronization, Asset Exchange, Multi-party business coordination”), use cases, and more. I appreciated the key trends and takeaways they synthesized, agreeing with them all and the conclusion that “there is a swell coming” as enterprises seek to participate in the initial use cases which have proven value. Moreover, it’s useful to see the common design patterns in use cases laid out in one place, and the very fact that there are repetitive use cases/business models signals a maturing industry, as I laid out in last week’s issue.

Some other activity you should pay attention to:

  • The IMI anchored Blockchain Enabled Healthcare consortia with a handful of major pharma companies was recently funded in full, albeit it has yet to kick off.

  • The FDA DSCSA pilot has several projects under it where businesses are collaborating with blockchains, I wouldn’t be surprised to see some of these turn into consortia and open up.

  • MediLedger has three significant parts to it: the FDA DSCSA piloting the 2023 interoperable system requirement, the Saleable Returns working group, and the Contracting and Chargebacks working group.

  • The clinical supply chain working group detailed below.

Hashed Health is conducting a 2 minute survey on the state of blockchain in healthcare

Seriously, I took it and it actually takes 2 minutes or less. It is also anonymous. Hashed Health is going to releasing the results of this survey, so I’d encourage my readers to take it.

A low profile working group including major pharma industry leaders is publishing more details about their work

LedgerDomain, the same company partnered with UCLA in the FDA DSCSA pilot is implementing a track and trace solution for clinical supply chains through the KitChain project. This is an interesting use case as clinical supply chains (e.g tracking bio-specimens or investigation products in a clinical trial) have many of the same problems as commercial supply chains (e.g traditional drug distribution channels). But it is much easier to get all of the parties in a clinical supply chain on the same system.

This work is sponsored by the Blockchain for Clinical Supply Chain – Industry Working Group, which is boasts Pfizer, Biogen, AstraZeneca, Merck, GlaxoSmithKline, Thermo Fisher, IQVIA, UCLA, Deloitte, Marken, Bracket, and Almac as members.

Podcast: Decentralizing Research and Development of Molecular Compounds

Webinar: Heather Flannery, Dr. Alex Cahana, and myself were recently on a ConsenSys webinar talking about blockchain and healthcare

What I’m reading this weekend

Numerai, a crowdsourced hedgefund that leverages cryptoeconomics, launched “an open market place for information of any kind”

I have a hunch that this same kind of technology can be applied to data in healthcare. Reach out to me if you have ideas for how and want to discuss them.

It’s the settlement assurances, stupid

We are still very early in the process of understanding blockchains, both public and private, and Nic Carter is a leading thinker exploring and formalizing this study. The above is a no-BS, wonkish piece on settlement assurances in public blockchains. But, I think this is important work for the private blockchain space too. The stakes are relatively low in the private blockchain implementations right now; no private blockchain is critical infrastructure or has serious economic activity powered on top of it. But if/when that changes there will exist huge incentives to attack these private implementations, and inevitably their security models will be pushed, or even broken. We should start being more thoughtful about security today to preempt that.

a16z’s Jesse Walden uses contract theory to examine blockchain projects

He delineates between “complete” contracts, which are those which are “trust minimizing and require little to no human intervention” (e.g Bitcoin, Ethereum), and and “incomplete” contracts, which have a need for human intervention and some degree of trust (e.g MakerDAO). These have tradeoffs in their ability to adapt and scale, though neither model is inherently better than the other in all situations.

Huawei CEO Calls on China to Create a Rival to Facebook’s Libra Crypto

MetaMask released their long awaited mobile wallet

It is the state of the art in user experience for blockchain projects. Spend a few minutes testing out the on boarding as well as the Venmo-like instant, transaction fee-less payments.

JP Morgan highlights credentialing use case & Facebook exec is grilled by Congress

Blockchain in healthcare updates

JP Morgan highlights physician credentialing as one of healthcare's leading financial opportunities in 2019
I think they could have done a better job at explaining the credentialing use case, but it's great to see companies like JP Morgan recognizing the value that blockchains can add. Health Unchained recently had a podcast with Anthony Begando, the CEO of ProCredEx, which is creating a blockchain solution for physician credentialing. You can watch it here.

Credentialing is a use case which has emerged as a repeated design pattern across healthcare and other industries. The same business model and technical solution underlying the physician credentialing solution also make sense for things like third party risk management in supply chains and know-your-customer verification for financial services.

I am a huge fan of Carlota Perez's Technological Revolutions and Financial CapitalIn short, she analyzes "surges of development" that have led to the diffusion of new technologies and ways of doing business (think Industrial Revolution, railway boom, age of steel, information age, etc). Each surge of development carries its own economic logic and a new set of business models (e.g. ad-based free services is native to the information age and is a repeatable business model) that displace old businesses and generate massive value. Perez provides a framework for thinkingabout these surges of development, including the bubbles they generate. 

I won't try to summarize each of these phases here, but as part of the "turning point" from the frothy but promising early stages of installment to the mature stages of deployment you need significant infrastructure improvements and replicable business models. I think it is too early to say we've hit that turning point; to cross that threshold we'll need the credentialing business model, among others, to be proven out further. But it is a good start and it makes me excited that multiple independent parties across different industries are settling on similar business models that are blockchain "native."

A crypto startup's blockchain document management solution is being used in a phase II clinical trial

Triall is "creating a digital ecosystem for clinical trials using a blockchain", and their first application is a document management solution for researchers. This application use a blockchain's unique properties of immutability to establish an audit trial of research documents such that you can verify their authenticity later. I thought this article from a team of researchers was a good introduction to the potential value proposition. The Triall team says it is being used in a phase II clinical trial as a pilot.

Triall received a grant from the Factom Protocol to build a decentralized identity for electronic Trial Master Files (eTMF). As far as I'm aware is the first instance of a blockchain and healthcare startup building on Factom, which is a PoA network with 21 nodes born out of a 2014 ICO.

Democratic Presidential Candidate Elizabeth Warren sends a greeting to blockchain and healthcare conference Conv2x

What I'm reading this weekend

0x had a critical vulnerability this month
0x is one of the more popular blockchain projects today. At a high level it helps users trade with each other in a decentralized way that alleviates some of the concerns of centralized exchanges. A number of other projects build on top of it and their team is highly respected.

So, it came as a surprise when this past week 0x triggered an "emergency switch" that paused all trades using their protocol. In short a vulnerability was discovered that would have let party A make any trade they would like with party B using 0x, regardless of whether another party B consented. You could have just taken other people's money. Yikes.

The vulnerability stemmed from a rather esoteric quirk in the EVM that went unnoticed by previous code audits by some of the top security teams in the space. The general consensus is that it is nearly impossible to catch all bugs. Formal verification, which provides stricter proofs and guarantees around the correctness of code, can help, but the way that the EVM is designed makes doing formal reasoning hard in some cases. The plan is for Ethereum to switch to eWASM along with its other 2.0 upgrades, and that should help.

What does this mean for healthcare enterprises? A takeaway here is that this is still bleeding edge technology and we should treat it with an appropriate level of caution. An equivalent vulnerability in, say, a protocol for patient data exchange, would have let anyone access other people's data without their consent. I actually think healthcare enterprises are uniquely suited for the challenge of building production grade smart contracts as they already build, operate, and maintain critical infrastructure.

Moreover, it speaks to the value of building on open source software with a huge community behind it. Doing so is analogous to having a global team that works for free 24/7 to discover bugs. I'd also point out that people are highly incentivized to do so with public blockchains and public projects building on top of them. Discovering a bug can yield hundreds of millions of dollars if you're able to exploit it. 

David Marcus, Facebook Blockchain Exec and co-creator of Libra, was grilled by Congress this week
These hearings had a wide spectrum of thoughtful questions and grandstanding. On one end of the spectrum you had Rep. Brad Sherman comparing Libra to 9/11. On the other end you had a congress people asking about why a particular release of Rust was chosen and how formal verification of the state machine of Libra and how governance of potential bugs would work. There was just about everything in between that as well, including some passionate and unexpected defenses of Bitcoinby representatives of Congress. You can watch the hearings here.

All in all I didn't feel like these hearings significantly affected the trajectory of Libra. It did demonstrate, at least in some law makers, that there is a level of nuance and understanding around cryptocurrencies, enough to differentiate between the corporate oligarchy of Libra and the decentralized network of Bitcoin at least.

My guess on the future: Libra will make some concessions to appease the US and launch. That might be headquartering the association in the US (not Switzerland) or backing the currency with dollars (instead of a basket with only 50% dollars). But given the geopolitical background I laid out in last week's issue, I expect that the West will begrudgingly allow Libra to launch in some form to compete with networks started by adversaries and decentralized upstarts.

Some other good readings about Libra this week:
Matt Levine's take on Libra vs JPMorgan Coin was good
Libra: a governance perspective
A closer look at Libra's code
Some of the concerns lawmakers had

All about Polkadot

The Web3 Foundation, which is behind the new blockchain network Polkadat, is planning to release a highly experimental test-net called the Kusama network. Analyst Tom Shaughnessy wrote a great introduction to Polkadot here. It's one of the upcoming smart contract platforms that I think is most promising.

Other things on my desk

A sweeping look at the market paradigm we're in by Bridgewater's Ray Dalio

Regulating genetic biohacking

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