A session by Michael Irish, CEO, Vivacitas Healthcare on the topic of 'Blockchain Innovation In Healthcare & Life Sciences' at IFAH USA 2019 held at Caesars Palace, 18-20 June, 2019.

1. Michael Irish, CEO
BLOCKCHAIN in HEALTHCARE AND LIFE SCIENCES
www.vivacitas.healthcare

2. My Experience with Blockchain
§First meeting I attended regarding blockchain had over $1
Trillion of market cap in the room and many different
industries represented
§Starts peer-to-peer crypto currency and now building out to
sector solutions beyond crypto currency: peer-to-peer
electronic cash systems unregulated by any central authority
§World Economic Forum estimates 10% of global GDP stored
in blockchain ecosystem by 2027
§Bitcoin consumes more power than Ireland. IBM has 1000
staff invested in Blockchain developing horizontal and
vertical solutions, Optum is in front of the market, and many
others.
§Rumors about long-term investment in hundreds of billions

3. One Bitcoin Transaction = 36,000 kettles of hot
water
If bitcoin and other crypto currencies continue to grow
exponentially without greater energy efficiency, in less than 10
years would / could consume the entire energy supply of Earth

4. Bitcoin consumes more power than all of
Ireland combined

5. Bitcoin and Blockchain inventor or discoverer
“Satoshi Nakamoto” Person/ Persons Unknown
some people argue the author of cryptonomicon may have "conceptualized" it

6. What is
blockchain? Blockchain is
cryptographically
secured,
distributed ledger
with a shared
state

7. Distributed Ledger

8. Blockchain: What is it?
“Blockchain is to Bitcoin, what the internet is to email. A big electronic
system, on top of which you can build applications. Currency is just one,”
Sally Davies, FT Technology reporter
“An open decentralized ledger that records transactions between two parties in
a permanent manner without 3rd party authentication or an intermediary (bank,
etc.)”
What is a ledger?
1. A book or other collection of financial accounts of a particular type.
synonyms: book, account book, record book, register, registry, log; records, archives,
books; balance sheet, financial statement "a sales ledger”
2. A flat stone slab covering a grave.

9. What is Blockchain, cont.
A blockchain “solution” generally builds on four features:
• Decentralized validation
• When a transaction occurs, new data blocks describing it are added to a chain only after
consensus is reached among the relevant participants on the validity of the action.
• Redundancy
• The blockchain is continuously replicated on all or at least a group of nodes in a network.
As a result, no single point of failure exists.
• “Immutable” storage
• Blockchain forces hackers to tamper with not just one block in a chain but all other blocks
and most of their replications. Data is registered in the blockchain with a digital fingerprint
that includes a date and time stamp; attempts to change data contrasts new digital
fingerprint vs. the old one.
• Encryption
• Digital signatures based on pairs of cryptographic private and public keys enable network
participants to authenticate which participant owns an asset, initiated a transaction, signed
an E contract, or registered data in the blockchain.

10. Military grade encryption
Distributed Ledger + Encryption = Blockchain
“Blockchain is cryptographically secured, distributed
ledger with a shared state.”
Quantum computing can mitigate this quality of encryption or
enhance it

11. Crypto assets vs. Blockchain

12. Evolving Paradigm
Internet of Value
Internet of
Agreements
Internet of Data

13. Blockchain alone is not enough and entire
digital ecosystem competing for capital

14. Blockchain Business Value
Blockchain and smart contracts technologies are actively
being developed
Early consortiums are accelerating development and
adoption
Current state business process efficiency and status quo
in supply chains is being questioned
New business models & strategies are emerging
New disruptors are entering a few market segments

15. Challenges on the road ahead
Scalability
Blockchain protocols are still emerging
• Smart contract platforms - Applications are in
their infancy
Technology Maturity
• Tell me it can't be hacked, I’ll show you how to
compromise it
Security
• Evolving technology, no standardization.
De facto standards and platforms will emerge
Standardization
• Everyone, globally, is trying to figure out what
are these new toys
Regulatory risk
• Too many players solving for similar use cases –
crowded market - will lead to consolidation
Market Maturity
• Where are the real users? When will they
come?
Mainstream Adoption

16. Blockchain is
more than
merely yet
another
technology
“It’s a strategy”
“It is a technology
platform that impacts
strategy”
“It creates new business
models”
“It is poorly understood”

17. Blockchain
is more
than yet
another
technology
“Blockchain coupled with
the power of immutability,
provenance,
cryptographically codifying
assets, propagated by
socially diverse inclusive
networks, a defined
consensus mechanism,
tokenization, emerging
crypto-economics opens
doors to trustless
decentralized economic
models.”
Source: https://medium.com/@roop.singh/blockchain-why-does-it-matter-
89bd0dba8b44

18. Blockchain by industry investment
~2.3 Percent of blockchain investment going
to healthcare – which is still using fax machines

19. Gartner Hype Cycle: Blockchain

20. Healthcare Business Value for Enterprise
§ Enhancing customer service
§ Proof of identity accelerated with high fidelity
§ Claims and payments can be accelerated
§ Greater certainty of transactions
§ Long chains of data that can be shared in near real time across
individuals and institutions that can be time stamped
§ Permissioned (private and identity masked)
§ Permissionless = all parties see all records
§ Fraud mitigation
§ Provider directories
§ More transparent regulation
§ Accelerates awareness of non-compliant transactions
§ Identity between provider, customer (patient) and payor can all be
attested to reducing probability of fraud

21. Where Blockchain Can Shine
§Static registry for data storage
§Dynamic distributed database that updates as
assets are exchanged on the platform
§Identity and fraud mitigation, identity records
§Smart contracts + claims processing and
payment
§Payment infrastructure + claims payment
§Estimated that 70% value near term cost
reductions

22. Hype vs. Reality
§ Scale, speed and efficiency
§ Consensus based validation
§ Continuous replication of data
§ Processing power and energy consumption
§ Bandwidth
§ It has been hacked and therefore is not perfectly secure (quantum
computing) and also brute force once control of nodes exceeds 50%-60%
§ Standards and global standardization
§ Adoption and competition with other digital initiatives
§ Artificial intelligence
§ Quantum computing / quantum blockchain
• A distributed system that sometimes depends on collaboration between
competitors, suppliers, and others will take time to evolve.
• Legal and regulatory issues.
• A rabbit hole of investment: Thus there is a high risk of initiating inefficient
solutions, and investment decisions will need to be taken carefully.

23. McKinsey Findings
• Blockchain does not have to be a disintermediator to
generate value, a fact that encourages permissioned
commercial applications.
• Blockchain’s short-term value will be predominantly in
reducing cost before creating transformative business
models.
• Blockchain is still three to five years away from feasibility at
scale, primarily because of the difficulty of resolving the
“coopetition” paradox to establish common standards.

24. Healthcare End Observations & Next
Steps
§ As CEO/CIO or board, this has a lot of big picture appeal but the market is not
there for “off the shelf” adoption (buy don’t build)
§ Attractive but immature platform
§ Building out either a public or private blockchain ecosystem is capital
intensive and mathematical labor resources are costly
§ Many health providers still reply on fax machines
§ There are options for value creation:
§ Cost reduction - Enhanced customer service
§ Fraud reduction
§ Supply chain enhancements
§ Business model transformation will compete with AI, overall digital
strategies

25. Healthcare End Observations & Next
Steps
§ If a trusted intermediary already exists then value curve declines
§ In transactions involving multiple parties with competing incentives, where
an strong, private records of data are needed, and no central trusted
authority is available or needed—then blockchain technology holds out huge
promise
§ Tokens, biometrics, and other systems had similar promise

26. Discussion and Q&A

27. Michael Irish, CEO
BLOCKCHAIN in HEALTHCARE
AND LIFE SCIENCES