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Inductively coupled transceivers (ICT) are widely being employed in implantable biomedical devices for wireless communication with the external world. The performance of such implant-to-body-surface communication is dependent on the characteristics of the transmitter, the receiver and the channel between them, which consists of layers of biological tissue. In this paper a representative ICT has been studied to characterize the effect of different physical orientations on the bit error process. The effect of biological tissue on the communication channel has also been quantified. The channel was measured to have a bit-level memory of 3 bits and a packet level memory of 6 packets. The impact of forward error correction (FEC) was analyzed and the use of 3-bit FEC was found to reduce the number of retransmissions by 65%. The results of this study enable optimization of reliable implantable communication systems.