Third-Party Logistics (3PL) Providers for Pharma
There is a lot of buzz over Pharma 4.0, but what does it really mean? At a basic level, Pharma 4.0 is a framework of pharmaceutical manufacturing digitalization – in other words, developing and leveraging new digital technology to enhance the pharma supply chain. It all goes back to supply chain logistics.
Working with a trusted logistics partner is the main way to achieve supply chain efficiency. This involves shared decision-making, collaboration, and sharing information. For the pharmaceutical industry, this 3PL partnership is more important than Pharma 4.0.
Trax understands the complexity of the pharmaceutical supply chain and is on track with goals for Pharma 4.0. With advanced transportation spend management software and data management capabilities, Trax offers pharmaceutical companies the chance to gain a competitive edge in the market.
Pharmaceutical Logistics in a Nutshell
Pharmaceutical logistics is the mechanism that offers the health care system support as it is directly related to supplying prescription drugs and other medicinal aids.
Pharmaceutical logistics covers the processes related to procurement, warehousing, inventory management, and transportation, among other supply chain activities. There are tons of pharmaceutical logistics companies out there offering products and services to streamline operations and digitalize the supply chain.
3PL and Pharma
Working with a 3PL in pharma opens the door to new licensing, distribution, and fulfillment opportunities.
One major benefit of working with an expert in the field is remaining compliant with current good manufacturing practices (CGMPs) set forth by the food and drug administration (FDA) related to pharmaceutical quality. In addition, the Drug Supply Chain Security Act (DSCSA) was enacted in 2013 and requires the traceability of prescription drugs to protect consumers from counterfeit, contaminated, or harmful medications.
While it isn’t necessary to work with a pharma 3PL to ensure compliance with the DSCSA, it certainly helps if the 3PL has a Drug Distribution Accreditation, taking the pressure off the manufacturer and letting the logistics experts handle the state and federal regulations.
Biopharmaceutical Third-Party Logistics: Analyses
Because the biopharmaceutical third-party logistics market is rapidly growing and changing, it’s important to look at the current research and statistical analyses related to expected trends.
According to recent research, the value of the global biopharmaceutical third-party logistics market was $119.8 Billion in 2021, and predictions show the market expanding at a compound annual growth rate (CAGR) of 5.9% through 2030.
According to the report, COVID-19 had a major impact on the biopharmaceutical 3PL market. Specifically, when developing the COVID-19 vaccine, there was a surge in the cold chain sector related to creating temperature-controlled packaging. In response to this growing need for innovation, biopharmaceutical companies turned to 3PLs to reduce supply chain disruptions and prioritize certain medications.
Pharma Logistics Market Drivers and Trends
As the pandemic influenced the rapid growth of the pharma logistics market, new trends emerged for pharma 3PLs. While some are directly related to the COVID-19 pandemic, others are more closely tied to Pharma 4.0.
Increase in Cold Chain
The global biopharmaceutical logistics market is typically segmented into cold chain and non-cold chain. According to Straits Research, non-cold chain accounted for over 75% of global revenue in the market, but cold chain is expected to have the highest CAGR.
Due to a rise in vaccine shipments and emphasis on biologics, cold chain services have become more important than ever before. Temperature data loggers are attached to shipments to record the temperature of biologics. Cold chain monitoring products will allow users to view temperature data and receive alerts.
Mobile and Cloud Computing
Moving things further, mobile and cloud computing solutions enable pharma 3PLs to gather more real-time information about cold chain shipments.
For instance, radio frequency identification (RFID) hardware and advanced software make collecting and tracking information throughout the supply chain easier. By moving the data to the cloud, companies can cut down on costs and provide pharmacists with real-time data. Ultimately, by sharing data between different parties along the pharma supply chain, mobile and cloud computing improves overall efficiency.
Data Mining and Management
Just as RFID hardware and logistics software make it easier to collect and track information, new data mining and management techniques are emerging in the pharma logistics market. Data mining typically involves uncovering patterns from big data with association, clustering, segmentation, and classification techniques.
According to research, as pharmaceutical companies become more comfortable with data mining and manipulation, they can compete on lower costs while maintaining and improving the quality of drugs and delivery methods.
Freight Audit and End-to-End Financial Visibility
As biopharmaceutical companies strive to manage their data better, they must also emphasize end-to-end visibility, specifically regarding financial data. This is where transportation spend management, and freight audit and payment (FAP) solutions come into play.
By understanding what is driving transportation costs and identifying inaccuracies through regular freight audits, it is possible to make the pharma supply chain more efficient. In addition, with the latest cloud computing and data mining, FAP solutions and freight management systems increase transportation speed, ensure end-to-end visibility, decrease unnecessary costs, and improve customer satisfaction.
Find a 3PL Provider for Pharma in Trax
Working with a 3PL provider for pharma lessens the load on manufacturers by streamlining processes and cutting costs. Trax is a leader in transportation spend management and freight auditing solutions with a proven track record across all industries. Contact a trusted advisor at Trax today to take the next step towards transportation spend maturity and Pharma 4.0.
Trax is the global leader in Transportation Spend Management solutions. We partner with the most global and complex brands to drive meaningful optimizations and savings through industry-leading technology solutions and world-class advisory services. With the largest global footprint spanning North America, Latin America, Asia, and Europe, we enable our clients to have greater control over their transportation performance and spend. Our focus is on your success.