The healthcare logistics industry is currently experiencing a shift toward globalisation, supply chain simplification and delivery specialisation, says an industry expert.
According to Mario Johnson, commercial manager for pan-European logistics firm Alloga, it is big pharma that is driving the globalisation trend. "We have found that our customers are looking to find economies of scale by consolidating their operations management for their global operations", said Johnson, although at the same time there is still a need to preserve local market knowledge, so regional expertise is also commanded at the same time. It is not only logistics providers that are experiencing a shift in this regard, but governments are also experiencing pressure from international pharmaceutical companies to align their regulations to support this regionalisation, Johnson added. In terms of supply chain simplification, Johnson cited the example of Pfizer, who a year ago introduced a new direct to pharmacy business model - the first of its kind in the UK pharma industry - which allowed the drug giant to take full responsibility for its medicines from their manufacturing centres until the point of sale.
The new system also brought the firm improved visibility, allowing it to be more responsive to stock shortage situations and better able to trace and recall its medicines if required. From Alloga's perspective as the chosen pre-wholesale logistics provider, the new model meant it only had to deliver to one single company and fewer warehouses. "The whole chain has been simplified, not only in terms of geography but also in terms of IT systems and processes; product monitoring can be more holistic, information management systems standardised and margin for error significantly reduced," said Johnson. Meanwhile, Johnson said that lately Alloga's customer mix has also been shifting, with the rise of the biotechnology company, and this is creating a demand for more niche service offerings to accommodate them.
"Biotechnology products being developed by pharmaceutical companies and specialised biotech firms are high-value, lower volume but most importantly, high maintenance," said Johnson. "We find that increasingly we are faced with specialist products that have specific requirements resulting in us adapting our role in the supply chain and expanding the breadth of our services," he said. This requirement for delivery specialisation has also resulted in the technology being used by healthcare logistics providers to become more sophisticated, high tech and precise in its operation. "Our systems can now not only monitor our fleet's progress and status, tracking every batch and reporting real-time the completion of the delivery but the all-important temperature levels of the cold chain can be monitored centrally, alerting head office to any potentially damaging changes."
While such cold chain capabilities are not new to the market, the prevalence of the offer amongst healthcare logistics providers is certainly on the increase, he said. "Delivery requirements are more demanding. It's not simply about getting a product from point A to point B, but temperature levels have to be regulated and, in cases of some chronic conditions, delivered to the patient's home and followed by a homecare visit."
Logistics firms that can stay ahead of the curve will find themselves well-positioned for the future.