“Blockchain technology has the potential to transform health care, placing the patient at the center of the health care ecosystem and increasing the security, privacy, and interoperability of health data.”
Written by Safwaan Patel, Edited by Isaac Haq
You can walk into any branch of your bank and they can tell you exactly how much money you have in your account, and the exact date and location of your transactions. Why can’t the same be done for ‘transactions’ in healthcare – whether these are doctor’s notes, prescriptions, test results or scans?
Medicalchain aims to create a blockchain based digital system of patient-controlled, secure and real-time electronic health records. This digital revolution has long been called for in healthcare to catch up to modern technology instead of relying on outdated legacy systems and paper records. Blockchain may be the answer.
PROBLEM + SOLUTION:
There are significant problems with current methods of patient data storage:
- Movement and interpretation– varying formats and data standards mean low interoperability of healthcare records between hospital systems, leaving patient records out of date and difficult to access. Doctors spend as much as 2/3 of their time filling out paperwork which is both costly and error-prone. Medical error related deaths are the 3rd biggest cause of death in the US, and much of this may be accountable to incomplete patient data and records.
- Patient control– Patients often have no control over their own data. Usually, it has to be specially requested, with some hospitals even charging for the service! In a world where health-conscious patients are seen as customers, there is an increasing demand for transparency in health data.
- Security– Security is vital for medical data storage, with patient data having an estimated worth of up to 10x more than credit card details on the black market. Criminals can take advantage of data vulnerabilities to make fraudulent insurance claims. In the US, the total cost of health insurance fraud is estimated at $40bn/year, and insurance companies accrue a staggering $315bn of billing and insurance-related costs in verifying treatments. In the UK the recent WannaCry ransomware attack that shut down certain NHS services for days highlights the vulnerabilities in current technology that relies on data stored on central servers.
- Data utilisation– Data is an important commodity, exemplified by Facebook selling information about an individual’s likes to 3rd parties for targeted advertisement. However, research in the healthcare industry has not taken advantage of the increasing volume of data collected both clinically and by increasingly popular wearables. Data is normally scattered, with healthcare providers and companies acting as intermediaries for firms interested in the data (e.g. big pharma). Rather than an intermediary system, companies should be able to collect anonymised data directly from patients.
- Telemedicine– video calling for health consultations, or telemedicine, is a market with an estimated worth of $23.5bn worldwide, which is set to grow to $55bn by 2021. Initiatives like NHS GP at hand are trying to remove the need to physically attend appointments where a phone consultation will do, thus reducing waiting times and admin fees. Currently, notes from these appointments cannot be added directly to patient records and often needs to be manually added at a later date.
Medicalchain uses a system of 2 blockchains based on hyper ledger fabric, developed by IBM and Linux, which allows specific control of permissions and access to information. This means the patient, who has a read-only version of the records, using their mobile and biometric verification (via the Civics secure identity platform) can grant access to their record when needed, including during Telemedicine consultations.
Permission to add to the record is only granted to healthcare professionals and once information is added, it is immutable– it cannot be tampered with. In emergency situations, where the patient can’t grant access, a bracelet gives key life-saving information such as blood group and allergies.
The blockchain part of this protocol simply means data is stored in a decentralised ledger amongst a network of ‘nodes’. Each node stores a complete version of the blockchain and must verify each transaction, leading to a secure, accurate and real-time ‘single-version of the truth’ record with data accessible from the browser of any internet connected device. This ledger gives patients the flexibility to choose where to receive their care rather than being constrained to a single local surgery or hospital, creating a competitive market for providers that will boost care quality. Medicalchain also provide a software development kit (SDK) for 3rd parties to integrate with the Medicalchain eco-system, with the goal of establishing an all-in-one medical data storage solution.
A cryptocurrency token ‘MedToken’ based on the Ethereum network’s ERC20 protocol is to be used to reward patients for sharing their medical data, to pay doctors for services and to encourage app developers to integrate with the Medicalchain network. This token creates a marketplace for medical data controlled by patients and accessible for advancements in biomedical and pharmaceutical research.
Medicalchain aim to release a public Beta of their software this year, after which plans have been made to pilot this software in Japan and East Asia.
Watch this video for a simple explanation of how the technology works.
MARKET + COMPETITORS:
The eHealth market is projected to reach $308bn by 2022, driven by a growth in diagnostics. With as much as 50% of the US population living with chronic conditions requiring regular monitoring, there is a great demand for a single platform for all of this data to be recorded. With over 44 million mHealth apps downloaded in the US in 2015, it is clear the future of healthcare is mobile.
Medicalchain hopes to gain investment via an ICO of their MedToken. Having completed a pre-sale round, they plan to open a crowd-sale for investors with a set price of $0.25 per token. They aim to raise $24m by selling up to 35% of the available 500m tokens, retaining the rest of the coins within the company for future use in incentivising developers. ICOs have been wildly successful recently, with firms like Bancor raising upwards of $150m on the largely on the basis of unproven technology and speculation.
DRIVERS OF GROWTH:
- Blockchain buzz: the viral popularity of cryptocurrencies have definitely led to blockchain being a hot topic in technology at the moment, with the world looking for the next blockbuster ICO.
- Changing patient-doctor relationship: Patients have increasing control of where they seek their healthcare and would thus welcome technologies that give them the flexibility to find the best care possible.
- More data: integrating this health data and creating a market for it provides a huge opportunity for AI-based analysis of patterns in these large datasets.
- Security: Medicalchain can fulfil the urgent requirement for improved security around patient data.
INHIBITORS OF GROWTH:
- Scalability: The recent viral successes of Etheremon and Cryptokitties on the ethereum network has led to spikes in transaction fees and waiting times, bringing into question its scalability
- Resistance to change: The digitisation of healthcare records has been notoriously slow, with no single technology becoming the standard even with existing technologies that can achieve a similar end result to blockchain based systems.
- Regulation: Most countries have regulatory measures in place that mean healthcare data must be held on central servers, and with strict data privacy laws and questions over the regulation of cryptocurrencies, it will be hard to convince governments that blockchain is the answer.
- Volatility: by valuing their token in terms of Bitcoin and Ethereum, the Medicalchain team have exposed this currency to the volatility that has become characteristic of cryptos of late, making the MedToken potentially unreliable to hold value in Medicalchain’s vision for a data marketplace.
- Network effect– The network needs to be almost universal to be effective; if Medicalchain don’t want to be just another fragment in healthcare records, they have the mammoth task of convincing every hospital in the world that their technology stands out.
Company finances: ★★★
Competitive advantage: ★★★
Likelihood of success: ★★
Final investor rating: ★★★
1) This blog has been created using public information about Medicalchain
2) This is an opinion piece intended only for educational purposes, not as professional investment advice.
3) I can declare no conflicts of interest in the publication of this article.