Tech giant IBM and China-based Sichuan Hejia Co. have launched a supply chain financial services platform based on blockchain technology, for pharmaceutical procurement, IBTimes reported.

Named as ‘The Yijian Blockchain Technology Application System’, it is a permissioned blockchain platform that uses Hyperledger Fabric. The blockchain system is designed in order to help curb some of the financing challenges in the pharmaceutical industry.

The Yijian Blockchain is in production with Hejia and a pharmaceutical retailer, which is a hospital and a bank running business transactions. Hejia is planning to expand the platform in a move to include multiple pharmaceutical retailers, hospitals, and banks, later.

“The launch of the supply chain financial services platform marks a milestone for the cooperation between Hejia and IBM on the innovative application of blockchain technology,” Leng Tianhui, board chairman of Hejia, said. “In the future, the platform will expand to include more industries to provide participating companies and financial institutions with transparent and efficient financing services built on blockchain-based innovation in a business model that will contribute to China's economic development."

The transparency of blockchain technology in tracking drugs via the supply chain and encrypting trading records establishes the authenticity of the transaction. It will help to curb the credit risk profiled by financing institutions that allow the payment period to be shortened.

The launch of the blockchain platform marks the successful business transformation of Hejia. IBM played the role in the launch by helping Hejia provide insights from analyzing the supply chain finance industry and the financing conditions facing pharmaceutical retailers

“Blockchain can fundamentally transform businesses by eliminating inefficiencies, speeding up transactions and enabling innovative new business models. The Yijian Blockchain Technology Application System we've built with Hejia is a great showcase of this capability. We look forward to continued collaboration with Hejia to apply this technology to other industry use cases,” Dr. Shen Xiaowei, director of IBM Research – China, CTO of IBM Greater China Group, mentioned, as reported by IBTimes.