GBI Research reports on 3PLs in pharma logistics

Pharmaceutical companies are hiring a little help, and joining with Third Party Logistics (3PL), but are they abandoning too much control over their business? asks a new report by healthcare experts GBI Research.?
By Patrick Burnson, Executive Editor
July 19, 2012 - LM Editorial

Pharmaceutical companies are hiring a little help, and joining with Third Party Logistics (3PL), but are they abandoning too much control over their business? asks a new report by healthcare experts GBI Research.?

?The new report states that use of 3PL companies is a growing trend in the global pharmaceutical supply chain, as cost cutting measures encourage businesses to use outside companies, who can offer services at competitive prices. However, while Direct to Pharmacy (DTP) and Reduced Wholesaler Agreements (RWA) models play a vital role in the UK, other EU countries are boosting their direct sales, and only time will tell which approach will succeed.??

Around 772 full-line wholesalers in Europe supplied pharmaceutical products to pharmacies, hospitals and doctors in 2010, according to the European Association of Pharmaceutical Wholesalers (GIRP). During this year, the overall sales turnover generated within EU-27 countries was valued at $180 billion.

The Institute for Pharmaeconomic Research (IPF) concluded that over 703 million transactions took place between pharmaceutical full­line wholesalers, pharmacies and manufacturers every year within France, Germany, Italy, Spain, the Netherlands and the United Kingdom collectively.??However, the number of full-line wholesalers in the UK is decreasing due to a rise in the adoption of alternate distribution systems such as DTP and RWA.

The impending absence of full-line wholesalers is expected to increase the number of transactions to 97.9 billion per year, and result in unnecessary transportation and delays for doctors who desperately need medicines.?? Logistical help has been prevalent in the pharma industry for several years, as Merck’s partnership with United Parcel Service (UPS) in 2003 set the scene for business collaborations.

UPS agreed to provide distribution and logistics services in the US, and this was later extended internationally. UPS Inc. now manages the distribution, warehousing and transportation of medicines and vaccines manufactured by Merck in North America, and according to the new deal, the company is set to additionally provide distribution, warehousing and transportation services for Merck in some Asian countries and Latin America, and transportation in Europe.

“While Merck benefit from a comprehensive delivery service, UPS have secured an enormous contact, and work in the upcoming pharma powerhouses of China and Brazil,” said Cathy Roberson, an analyst with the London-based think tank, Transport Intelligence. “ However, does this deal signify a loss of control for Merck, as aspects of their business are run by another company?”



About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

As the July 1st date for complete compliance looms, shippers are seeking help to cope with the mandatory changes instituted by the International Maritime Organization (IMO) to the Safety of Life at Sea Convention (SOLAS).

As of July 1, only containers with a verified gross mass will be cleared to be loaded onto a ship under the International Maritime Organization’s Safety of Life at Sea (SOLAS) Verified Gross Mass (VGM) amendment. Shippers hoping that the implementation of the ruling will be delayed or deferred are whistling in the dark, say industry analysts.

Amid the many worrisome economic indicators kicking around of late, something along the lines of good news came about this week in the form of United States new home sales data, issued by the United States Department of Commerce this week.

In March, the SCI came in at 0.4, which FTR described as “a near neutral reading” on the heels of four months of more favorable market trends for shippers.

The $4.8 billion acquisition of Netherlands-based TNT Express-NV, a provider of mail and courier services and the fourth largest global parcel operator, by transportation and logistics services provider FedEx was made official today.

Article Topics

News · 3PL · Supply Chain · Logistics · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2016 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA