Pharmaceutical Logistics Market Analysis Report By Type, By Component, By Region And Segment Forecasts From 2020 To 2027

Industry Insights

The global pharmaceutical logistics market size was accounted for USD 69.0 billion in 2019. It is projected to register a CAGR of more than 7.3% over the forecast period, 2020 to 2027. COVID-19 pandemic is expected to be a crucial factor for the growth of this market. Due to the coronavirus spread across the world, governments are now more emphasizing medicinal and healthcare facilities. Moreover, trades of conventional medicine are rising.

Several companies like Calci Medica Inc., Adaptive Biotechnologies Corporation, and Amgen Inc., are engaging in R&D for coronavirus. Research is comprised of the application in different medicinal compounds and drugs which are required to be transferred with the help of cold chain solutions. Furthermore, various companies like Pfizer Inc., BioNTech SE are focusing on developing a vaccine for COVID-19. Thus, the market is projected to foresee rapid growth once the coronavirus vaccine is developed.

Growing demand for drugs, medicines including minerals, supplements, vitamins, cold drugs, dermatology products, and gastrointestinal drugs is increasing the growth of the industry. A single-source type distribution network is expected to support market growth, as it improves logistics capability and also reduces overall costs. Moreover, various companies are doing strategic acquisitions & mergers to increase their reach across the world. However, the pharmaceutical supply chain and biotechnology are more inclined to the risk of product alteration owing to stiff federal standards and regulations. Furthermore, the technological development in remote monitoring and telematics is also expected to boost the pharmaceutical logistics market growth.

Companies in the market are outsourcing packaging operations through third-party service providers. The key participants in the market are focusing on reaching untapped areas of Latin America, and Africa. Drug manufacturers prefer local logistics service providers in these areas. However, service deterioration during outsourcing operations may hinder the growth of the market.

In the U.S., increasing demand for generic drugs is boosting market growth. The North American market is substantially fragmented due to the existence of international and domestic players.

Key companies in the market are striving for cloud solutions to efficiently perform drug authentication. This helps to prevent the counterfeiting of medical devices and drugs. Growing demand for air freight and sea transport pharmaceutical logistics is projected to foster market growth. Sea freight transportation reduces transportation costs to around 80.0%. In addition, this method of logistics conserves storage and packaging needs with reduced carbon footprints. The rising trend of airfreight logistics is also projected to bolster market growth.

Type Insights

Based on the type, the pharmaceutical logistics market is fragmented into non-cold chain logistics and cold chain logistics. In 2019, the cold chain logistics segment held the highest market share of over 26.0% in the overall market. The increasing need for temperature-monitored products is mainly supporting the market growth. The rising use of telematics especially in cold-chain type logistics helps companies to improve their efficiency. In addition, the growing use of IoT devices, and cloud computing tools in refrigerated containers and trucks help pharmaceutical companies to remotely monitor vaccines & drugs. 

Medical and biological products need temperature-controlled space during the distribution & manufacturing process. The Non-cold type chain logistics type segment is projected to grow at a significant rate in the next few years.

Component Insights

In 2019, the storage component segment led the market with the largest market share of over 64.70% in the overall market. The growing focus on temperature-sensitive storage containers during the transportation of pharmaceutical products is contributing to the growth of storage components in logistics operations. Changing consumer preferences and rising demand for nutritional supplements are projected to bolster the market growth. The storage type segment is comprised of refrigerated and warehouse containers.

The monitoring component type segment is projected to register the fastest CAGR during the forecasted period. Safety, integrity, and ensuring efficiency measures are boosting the growth of segmental growth. The transportation type segment is estimated to grow at a significant rate from 2020 to 2027. This segment is comprised of air freight logistics, overland logistics, and sea freight logistics.

Regional Insights

In 2019, North America accounted for the highest market share in the overall pharmaceutical logistics market. There are a significant number of international and domestic players present in the region. Moreover, strategic acquisition and mergers between the companies like AbbVie Inc., and Bristol-Myers Squibb are projected to boost market growth.

Asia Pacific market is estimated to grow at the fastest CAGR during the forecasted period. The increasing geriatric population is growing the demand for medicine which in turn, is expected to bolster the regional growth. Emerging economies across South America and Asia Pacific countries are expected to provide ample growth opportunities for industry growth in the next few years.

Impact of COVID-19

COVID-19 pandemic has negatively affected the market. Coronavirus outbreak has triggered substantial disruption in supply channels in the pharmaceutical industry across the globe. The majority of the Active Pharmaceutical Ingredients (API) manufacturers are based in India and China. However, lockdown and transport restrictions have shut down the production of APIs in these countries.

During the COVID-19 pandemic, production stoppage has caused a shortage in raw material, labor force which, in turn, is impacting API production. After the U.S. Food & Drug Administration’s (FDA) statement confirming drug shortage in the country, India has banned the export of around 26 pharmaceutical formulations & ingredients which are used in the production of generic drugs such as antibiotics and paracetamol. Furthermore, to mitigate supply chain risks, FDA is monitoring over 180 human drug manufacturers' supply chains which include APIs from China.

Pharmaceutical Logistics Market Share Insights

The companies in the market focus on strategic acquisitions, collaborations, and partnerships to increase their presence across the world. For example, Pharma Logistics has acquired the distribution segment of Stericycle Inc., in 2019to increase their reach across the globe.

Some of the key players focus on investing in developing innovative technologies including GIs integration, GPS, remote monitoring to improve their logistics service. Key companies in the market include,

    • Agility
    • CEVA Logistics
    • Air Canada
    • DB Schenker
    • Deutsche Post AG
    • FedEx
    • LifeConEx
    • Marken
    • United Parcel Service of America, Inc.
    • VersaCold Logistics Services

Report Scope

Segments Covered in the Report 

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2016 to 2027. For this study, Million Insights has segmented the global pharmaceutical logistics market report based on type, component, and region:

• Type Outlook (Revenue, USD Billion, 2016 - 2027)
    • Cold Chain Logistics
    • Non-Cold Chain Logistics

• Component Outlook (Revenue, USD Billion, 2016 - 2027)
    • Storage
        • Warehouse
        • Refrigerated Container
    • Transportation
        • Sea Freight Logistics
        • Air Freight Logistics
        • Overland Logistics
    • Monitoring Components
        • Hardware
            • Sensors
            • RFID Devices
            • Telematics
            • Networking Devices
        • Software

• Regional Outlook (Revenue, USD Billion, 2016 - 2027)
    • North America
        • U.S.
        • Canada
        • Mexico
    • Europe
        • U.K.
        • Germany
        • France
    • The Asia Pacific
        • China
        • India
        • Japan
    • South America
        • Brazil
    • Middle East & Africa (MEA)