Can connecting devices to the internet so they speak with each other transform life sciences? SCM World recently published an Internet of Things (IoT) study with chief supply chain officers. Here’s what Barry Blake, their VP of Research and a NEXUS '15 keynote speaker, has to say about how embracing connectivity will benefit the supply chain, patient outcomes, and the future of healthcare.

How would you define the Internet of Things?

There are different definitions but when I think of the Internet of Things, it’s really about, “Everything that can be connected is going to be connected.” Devices, machines, people, factories: any noun that can be connected to other nouns via the internet is going to be connected.

In 2010 there were around 42 million machines connected to other machines. In 2014, that jumped to 242 million. That’s a massive increase—people are recognizing the tremendous practical applicability in having these machines communicate with each other. The Internet of Things is here, right now.

The most common catchphrase you’ll see in front of Internet of Things examples is they’re smart. Smart distribution, smart manufacturing, smart life sciences. This idea of the intelligence within machine to machine communication is what’s driving it.

What are the benefits for life sciences?

Increasing efficiency is definitely a major one. In industries like healthcare and life sciences, IoT can potentially help bring costs down across the system. Think about the bar code that’s on every can of soda. When scanned, information is immediately made visible to the makers. The Internet of Things has the power to create that visibility for this industry.

Today, we don’t know what happens to product—we push it out the door and pretty much forget about it. We don’t think from the patient back. It’s very inefficient. We’re throwing out medicines all the time. If you look inside big pharma companies, the amount of obsolescence within those organizations is astronomical. The amount of inventory they have to support their inefficient ways is massive, so you really can make some major changes and move healthcare and life sciences in the direction that other industries have already gone.

What changes could the Internet of Things bring to patient care?

Imagine the data we could use from smart packaging. If you put a sensor on a pill bottle that can indicate when it’s empty and needs to be refilled, or whether the person is sticking to their adhered treatment program—that’s where the opportunities are huge and can really improve patient outcomes. And because companies would have that data from the customer, they could respond to specific patient need and fulfill orders across the supply chain in a much more effective manner.

Life sciences are often thought of as an industry that’s lagging behind other industries, like consumer products or high tech. That may be the case, but life sciences is one of the industries with probably the most to gain from the adoption of IoT capabilities because of the impact it’s going to have on patients.

How will the advent of serialization dovetail with the Internet of Things?

If you bring together adoption of IoT and serialization, you have what everybody has dreamed of within healthcare and life sciences: full visibility across the supply chain, including visibility at the unit level and how medication is moving through the system.

That leads to improved supply chain security, as well, including reduction of product adulteration, counterfeiting of products and parallel trade. Those are all very important to life sciences companies—not only for patient safety, but for the success of their business as well.

What will prompt full adoption of the Internet of Things by the life sciences industry?

The direction of healthcare is changing: it’s all focused on cost, on quality, on outcomes. That’s what’s going to be reimbursed now—the future. And if your product and way of doing business doesn’t meet those objectives, then you need to change the way you’re doing business.

Adoption of IoT across the industry has to a collaborative, cross-ecosystem event. It doesn’t mean that competition goes away at all, but there are areas where collaboration can occur between distributors, manufacturers, health systems and retail pharmacies. If they’re not marching towards the same goal with the same expectations, it’s never going to take root. The current drive to compliance and serialization is a nice push to move the industry forward in that direction.

At SCM World, Blake leads research about distribution and logistics networks and supply chain transformation and talent development. His research cuts across all industries with a particular focus on the healthcare and life sciences value chain. Prior to SCM World, he was the lead healthcare and life sciences analyst on Gartner’s supply chain research team, where he led and managed the Healthcare Top 25. He has also served as a senior research analyst and client services manager at AMR Research. In total, he has published over 60 research articles and reports on numerous supply chain topics.