The Total Addressable Market (TAM) for biopharmaceutical logistics was valued at USD 118.45 billion in 2022. It is projected to reach USD 198.93 billion by 2031, growing at a CAGR of 5.93% during the forecast period (2023–2031).
Biopharmaceutical third-party logistics refers to the logistics services that third-party companies offer to pharmaceutical companies (3PL). For example, it includes getting small-molecule pharmaceuticals into the warehouse, filling orders, and using a warehouse management system to keep track of the goods in the warehouse. For example, 3PL helps pharmaceutical and medical institutions maintain logistics for the delivery of medical therapies by lowering overhead costs that aren't needed, ensuring that products are always available, improving transportation, and making the organization more efficient. Biopharmaceuticals have become popular in treating a wide range of diseases, such as metabolic disorders and cancers, in a clinical setting.
One of the most important things driving the growth of temperature management logistics services is the improvement of technology. New technologies like warehouse robots, mobile cloud solutions, data mining, and real-time monitoring have significantly affected the logistics business as a whole More than 60% of service providers who offer third-party logistics (3PL) think that complex chain services are essential for the future growth of their business. Smart sensor technology is the name for the technology that can measure the conditions inside the car. DHL can improve its distribution network partly because it uses devices with the latest technology.
Logistics services in developing countries still need to be better developed than those in industrialized countries. This demand for services is due to a need for more skilled workers in biopharmaceutical logistics. Because there need to be more qualified people, it's also hard to grow the biopharmaceutical logistics industry. Because of this, the global market for biopharmaceutical logistics has slowed down. Because there is no direct management, the shipper has to work with a logistics company from the outside. Because there needs to be more oversight, producers are risking the quality of their products. Because shippers don't have any say over logistics services, the growth of the global biopharmaceutical logistics market is being held back.
Many trade-related activities have grown as a direct result of the world becoming more connected. Because of this, it takes a lot of work for wholesalers and manufacturers to keep accurate records of these operations in a timely way. Businesses help manufacturers with this by keeping correct records of how they are in charge. In addition, the growth of the global market is a big reason the biopharmaceutical logistics industry is moving forward. As a direct result of this, increasing globalization and business exchange activities are helping the global biopharmaceutical logistics market to grow and expand.
The global biopharmaceutical logistics market is segmented by supply chain and services.
Based on the supply chain, the global biopharmaceutical logistics market is bifurcated into cold chain and non-cold chain.
The non-cold chain segment is the highest contributor to the market and is expected to grow during the forecast period. It is because many drugs don't need to be kept at a specific temperature and are sent through general cargo. Third-party logistics services give you more visibility, help you build a strong distribution network, and make it easier to grow while lowering operational costs. So, 3PL has become essential to pharmaceutical companies' business plans. The other thing that has helped the non-cold chain segment grow is that, unlike biologics, more and more SKUs per distributor do not need temperature-controlled shipping. 3PL services make it easier to grow, and more visibility lowers operational costs and helps build a more robust logistics network with higher returns and fewer risks.
Based on services, the global biopharmaceutical logistics market is bifurcated into transportation, warehousing, and others.
The transportation chain segment is the highest contributor to the market and is expected to grow during the forecast period. It is because the pharmaceutical and healthcare industries need many 3PL services. Life sciences companies are using 3PL services to cut their operating and overhead costs. Due to a rise in demand, service providers have added more services, such as warehousing and packaging, to what they already offer. Companies in the life sciences use 3PL to cut costs and overhead. Service providers have added warehousing and packaging to their products because demand has increased. Packaging is essential to pharmaceutical logistics because it is used more than storage facilities to move medicines.
The global biopharmaceutical logistics market is bifurcated into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.
North America is the most significant shareholder in global biopharmaceutical logistics and is expected to grow during the forecast period. It's mostly because the region is the leader in the biologics and pharmaceutical drugs market, and the number of biopharmaceuticals being shipped out of and into the region is growing. Because of this, North American pharmaceutical companies rely more and more on third-party logistics (3PL) service providers to improve their warehousing and shipping, which is helping the area to grow. There are also a lot of big companies in these places, which is another reason this product has the biggest market share. North America is expected to have the highest CAGR during the projected time.
Asia-Pacific is expected to grow during the forecast period. A few factors in the Asia-Pacific region are causing it to grow at the fastest rate. These factors include an aging population's growing need for pharmaceuticals, the rise of technologically improved services, and the economies of countries like China and India. Also, the fact that more and more patents will expire over the next few years shows that there will be a significant shift in the market share of medicine sales away from the original brand manufacturer and toward generic ones. Because of this, it is expected that the sales of pharmaceutical items will go up, as will their import and export. Part of what drives the demand for pharmaceuticals and biologics is that more and more people are getting sick. For example, because there are so many people with type 2 diabetes in Asia and the Pacific, there is a more significant need for insulin in those areas.
According to Germany Trade and Invest, Germany is the largest pharmaceutical market in Europe. People think of the country as one of the most critical places in the world for making pharmaceuticals. Its highly skilled labor force allows pharmaceutical companies to work on more complicated and demanding goods like biosimilars while maintaining high production quality. The pharmaceutical logistics market in Europe is very competitive and has a lot of different players. There are both local and international market players in the European area. As sales of pharmaceuticals have gone up around the world, so need companies that help with logistics for drugs. In the coming years, logistics service providers will likely have many more chances to make money.
Patients are increasingly able to pay for the newest and best biopharmaceuticals because their incomes are increasing and insurance coverage is improving. In the meantime, regulators are streamlining their approval processes to get new biopharmaceuticals and biosimilars on the market faster than before. Because of this, pharmaceutical product sales, imports, and exports are likely to go up. The rise in diseases also pushes up the demand for biologics and pharmaceuticals. It is predicted that high untapped market potential in nations like Colombia, Brazil, Argentina, Chile, and Peru will present profitable growth prospects for the industry.
The global biopharmaceutical logistics market’s major key players are
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