Trusted Business Insights answers what are the scenarios for growth and recovery and whether there will be any lasting structural impact from the unfolding crisis for the Pharmaceutical Logistics market.
Trusted Business Insights presents an updated and Latest Study on Pharmaceutical Logistics Market 2020-2029. The report contains market predictions related to market size, revenue, production, CAGR, Consumption, gross margin, price, and other substantial factors. While emphasizing the key driving and restraining forces for this market, the report also offers a complete study of the future trends and developments of the market. The report further elaborates on the micro and macroeconomic aspects including the socio-political landscape that is anticipated to shape the demand of the Pharmaceutical Logistics market during the forecast period (2020-2029).
It also examines the role of the leading market players involved in the industry including their corporate overview, financial summary, and SWOT analysis.
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Report Overview: Pharmaceutical Logistics Market
The global pharmaceutical logistics market size was valued at USD 78.9 billion in 2020 and looks set to grow at a compound annual growth rate (CAGR) of 6.2% from 2021 to 2027. The short-term impact of COVID-19 on the market is the crucial factor for pharmaceutical logistics fast-paced growth across the globe. Amid the pandemic, governments around the world are emphasizing on healthcare facilities and ample medicinal supply for the patients. As such, the trade of conventional medicines is increasing from country-to-country. Additionally, the U.S. Food and Drug Administration (FDA) has approved Emergency Use Authorization for hydroxychloroquine, which is to be used by licensed health care providers to treat teens and adults hospitalized with COVID-19, who weigh more than 50 kg. As such, the trade of hydroxychloroquine is increasing in countries, including the U.S. and India.
Many pharmaceutical companies, such as Amgen Inc.; Adaptive Biotechnologies Corp; and CalciMedica Inc., are actively engaged in the research and development of treatments for COVID-19. This research includes the use of various drugs and medicinal compounds that need to be transported using a secure cold chain solution, which in turn is expected to increase the market for pharmaceutical logistics. Additionally, the companies, including BioNTech SE; Heat Biologics Inc.; and Pfizer Inc., are focusing on the development of the COVID-19 vaccine. The market is expected to witness considerable growth once the vaccine is successfully developed and deployed worldwide. Along with this, the demand for medicines used for curing the novel coronavirus disease is also expected to increase the market growth.
The growth of the market is also attributed to the increasing demand for Over The Counter (OTC) medicines such as Vitamins, Minerals, and Supplements (VMS), common cough and cold drugs, gastrointestinal drugs, and dermatology products. The rising importance of fast track assistance in the healthcare sector is also driving the market for pharmaceutical logistics. Moreover, decreasing the distribution cost by creating a single source distribution channel is further boosting the demand for pharmaceutical logistics. A large number of companies are entering into mergers and acquisitions to expand their geographical presence and proprietary knowledge. They are also focusing on reducing the overall packaging costs of their products. The biotechnology and pharmaceutical supply chains are particularly prone to the risks associated with product adulteration during transport as well as non-compliance with federal regulations, standards, and guidelines. As a result, the players are actively investing in state-of-the-art technologies such as telematics and remote monitoring to provide safety and convenience during transportation operations, which is, in turn, propelling the market growth.
The pharmaceutical manufacturing companies are increasingly outsourcing the packaging and labeling activities from third party providers. Many pharmaceutical companies are expanding their operations in the untapped regions including Sub-Saharan Africa and Latin America. Herein, the preference for local logistics providers with high expertise in pharmaceuticals is of great importance to drug manufacturers. However, the deteriorating service levels and loss of control are significant threats that are faced in outsourcing operations.
The demand for pharmaceutical logistics is growing in the U.S. on account of increasing sales of generic drugs, as well as reforms in the healthcare sector favoring generics. The market for pharmaceutical logistics in North America is significantly fragmented owing to the presence of a large number of regional and international companies. The industry is highly competitive, owing to the presence of many local and global companies.
Major companies strive to offer cloud-based supply chain solutions and secured supply chain functions as it helps manufacturers in verifying the authenticity of the drugs. These solutions prevent the production of counterfeit drugs and medical devices. The increasing demand for sea and air freight pharmaceutical logistics is anticipated to propel industry growth over the forecast period 2021-2027. The transportation of pharma products by the sea reduces the transportation cost up to 80.0% and brings down the staffing requirements. Additionally, it conserves on the packaging and storage needs while reducing the carbon footprint of logistics operations. The increasing use of air freight logistics for long-distance and intercontinental distribution of valuable vaccines and medicines is expected to fuel the growth further.
Type Insights: Pharmaceutical Logistics Market
In terms of value, cold chain logistics lead the market with a share of 26.3% in 2019. This high share is attributable to the rising demand for temperature-controlled products. The cold chain segment is expected to continue its dominance over the forecast period. The growing adoption of telematics in cold chain pharmaceutical logistics is helping the companies to enhance the efficiency, connectivity, and safety of transport cargoes. Furthermore, the increasing adoption of cloud computing solutions and new IoT devices in refrigerated trucks and containers allows pharmaceutical logistics companies to provide real-time remote temperature monitoring while transporting temperature-sensitive drugs and vaccines.
Most of the biological and medical products require a temperature-controlled environment during the stage of manufacturing and distribution, which helps in maintaining the effectiveness and quality of the medicines. Thus, pharma companies are using temperature-controlled transportation and cold storage systems. The non-cold chain segment is expected to have a considerable share in the next seven years owing to the increasing demand for the non-cold chain products.
Component Insights: Pharmaceutical Logistics Market
In terms of value, the storage segment lead the market with a share of 64.7% in 2019. This high share is attributable to the increasing focus on the storage of temperature-sensitive supplements to make sure that the pharmaceutical products are safe during transportation. Factors such as changing lifestyles of consumers and the dietary pattern are driving the demand for temperature-sensitive protein and nutritional supplements, which is expected to increase the demand for the storage segment over the forecast period. The storage segment is further segregated into the warehouse and refrigerated container.
The monitoring components segment is expected to witness the highest CAGR from 2020 to 2027 owing to the increasing need to ensure the efficiency, integrity, and safety of the cold chain products. The monitoring components segment is further segregated into hardware and software components. The transportation segment is likely to reach a considerable growth pace over the forecast period. The transportation segment is further divided into sea freight logistics, air freight logistics, and overland logistics. The increasing adoption of the sea-based pharmaceutical logistics is driving the pharmaceutical logistics market as the sea freight logistics services are capable of handling sensitive large molecule biologics as well as personalized medicines.
Regional Insights: Pharmaceutical Logistics Market
North America lead the market with a share of 36.1% in 2019. This is attributable to significant fragmentation in North America owing to the presence of a large number of major industry participants. Moreover, an increasing number of mergers and acquisitions among pharma companies, such as Bristol-Myers Squibb and AbbVie Inc., is likely to drive the regional market further. Based on region, the market for pharmaceutical logistics is also segmented into Europe, Asia Pacific, South America, and the Middle East and Africa.
Asia Pacific is projected to be the fastest-growing region owing to rapid economic growth in emerging countries, such as China and India. High demand for medicines due to the growing geriatric population will also augment the market for pharmaceutical logistics in Asia Pacific. Moreover, the pharmaceutical industry is undergoing a geographic shift in production and sales locations. The market players are finding lucrative opportunities in the developing economies in Asia and South America, which is in turn expected to increase the market growth in these regions.
Key Companies & Market Share Insights: Pharmaceutical Logistics Market
To maintain the position in the market, the pharma companies continuously undertake strategic initiatives such as mergers and acquisitions. For instance, in October 2019, Pharma Logistics acquired the pharmaceutical reverse distribution division of Stericycle, Inc to expand the geographic footprint as well as expand the service portfolio. Furthermore, the companies in the market are investing in technologies such as telematics, remote sensing and monitoring, and GPS and GIS integration in transport cargo, thereby providing the customers with a safe and convenient pharmaceutical logistics services. Some of the prominent players in the pharmaceutical logistics market include:
Key companies Profiled: Pharmaceutical Logistics Market Report
- Air Canada
- CEVA Logistics
- DB Schenker
- Deutsche Post AG
- United Parcel Service of America, Inc.
- VersaCold Logistics Services
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Trusted Business Insights has segmented the global pharmaceutical logistics market report based on type, component, and region:
Type Outlook (Revenue, USD Million, 2016 – 2027)
- Cold Chain Logistics
- Non-Cold Chain Logistics
Component Outlook (Revenue, USD Million, 2016 – 2027)
- Refrigerated Container
- Sea Freight Logistics
- Air freight logistics
- Overland Logistics
- Monitoring Components
- RFID devices
- Networking devices
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