Enjoy!
Global Healthcare Logistics 2014: What to Expect - by Lilith Gardiner
So, as promised, I held a short interview with Cathy to offer some exclusive insights into progress and content of the upcoming Global Healthcare Logistics Report.
Lilith
Gardiner (LG): The healthcare industry is vast and varied (as is
Ti’s/your coverage of it!) in terms of logistics, which areas would you
highlight as ‘ones to watch’ and why?
Cathy Roberson (CR): Like so many
other industries, healthcare/pharma is transforming – expiration of
patents, industry consolidation, changes in government regulations and
requirements and the growing influence of emerging markets are all
having a major effect on not only the industry as a whole but also in
terms of logistics.
LG: Are there any areas that you have found interesting to monitor?
CR: From a personal perspective, the
cold chain is extremely interesting. For so long, air freight providers
have been heavily dependent on high-tech goods. Now, as the high-tech
market undergoes its own transformation and with some shifts favouring
ocean transport, air freight providers are looking for alternative
solutions. Biopharmaceuticals fills that need very nicely – according to
various research, 25% of all healthcare products are temperature
sensitive and that by 2016, over 50% of the top 50 best–selling drugs
will require cold chain transportation (Brief: Growing Demand for Healthcare Necessitates Better Logistics).
However, this type of cargo requires special monitoring and handling –
as such, many logistics providers such as DHL, FedEx and UPS have
developed solutions to address these needs.
LG:
You’ve written a number or briefs and blogs about pharmaceutical
distribution, what is it that makes this an interesting area to focus
on?
CR: Distributors are redefining their
role – by globalizing and as competition for logistics providers. The 3
largest US distributors have approached this in unique ways – Cardinal
Health has invested heavily in the Chinese market by acquiring several
domestic distributors. Meanwhile, McKesson, a US-based pharmaceutical
distributor, recently acquired Celesio, an European medical logistics
provider. AmerisourceBergen acquired World Courier, a niche air cargo
provider that provides the clinical trials transport. In 2013,
AmerisourceBergen also signed a 10-year, $400bn agreement with Walgreen,
the largest drug retailing chain in the US and with Alliance Boots,
which was formed through a merger of the British high street pharmacist
Boots Group and the pan-European wholesale and retail pharmacy group
Alliance Unichem. Walgreens owns a 45% share of Alliance Boots. This
alliance has been dubbed “the Earth’s Drugstore” and will have a very
interesting and influential supply chain (Brief: Competition increases in the pharmaceutical wholesale market)
LG:
What role can a logistics provider really play within the healthcare
supply chain and how has this changed from Ti’s last healthcare industry
report, Global Pharmaceutical Logistics 2012?
CR: I think with the last report many
pharmaceutical manufacturers were just beginning to recognise the
important role logistics providers could provide. Logistics providers
have really stepped up their game and have become quite knowledgeable in
the supply chain needs of the healthcare industry. As such, outsourcing
has picked up particularly as pharmaceutical manufacturers expand into
new geographies and may not be as knowledgeable in the transport
infrastructure, import/export requirements, regulations and compliance
etc. This is where a logistics partner can come in handy.
The healthcare supply chain is getting
longer and complicated and a good logistics partner can help by
“uncomplicating” the supply chain and create a network solution for the
healthcare customer.
LG: What other areas have been developing in the healthcare supply chain?
CR: Technology is also becoming a
major focus for pharmaceutical providers, particularly cloud computing.
Pfizer has embraced this technology and has creating a global system in
which it supposedly has real-time visibility in tracking and monitoring
of its goods, including temperature-based, anywhere in the world. Unyson
Logistics, part of The Hub Group, assists in monitoring of logistics
and transportation partners.
LG:
Threats to the supply chain is a concern in all industries, can you
identify some of the main threats to the healthcare supply chain that
you might investigate in this report?
CR: Counterfeit drugs are a huge
threat to the supply chain. In fact, according to the World Health
Organisation’s estimates, it is thought that 10-15% of the world’s drug
supply (about 1% in the United States) is counterfeit. Each country is
grappling with this issue. The US government recently passed the Drug
Quality and Security Act which will create a national track and trace
system and hopefully cut down on this dangerous problem.
LG: What else can threaten the supply chain?
CR: Properly monitoring temperature
sensitive goods while in transit is a big concern. Manufacturers need to
do their homework when deciding upon transportation and logistics
providers – not all are able to provide the specialised service and
handling that temperature-controlled goods require.
Finally, the global supply chain
itself can be a risk – political upheavals, natural disasters,
infrastructure concerns must all must be taken into consideration when
the supply chain becomes further extended.
You can also be alerted to the publication of this report by signing up to our free Logistics Briefing where you can also receive news updates and briefs on the logistics industry.
I’d like to thank Cathy for setting aside the time to hold the interview as well as thank you for reading, thank you!
