DHL expands in life sciences with China site & JV takeover
Opening of the 140m² facility in Beijing Capital International Airport follows shortly after DHL set up a similar centre in Seoul, South Korea and continues the expansion of Asian life science capabilities. DHL now has close to 1,000m² of temperature-controlled warehouse space in China.
“The new centre is expected to serve growing Chinese pharmaceutical and biotech companies which require regulatory-compliant cold chain transportation with highest security and quality standards”, Steve Huang, CEO of DHL Global Forwarding, China, said.
Housing the temperature-controlled facility, which can store products at 2°C to 8° and 15°C to 25°C, at an airport cuts the risk drugs will spend time in suboptimal conditions during customs clearance.
DHL has also taken full ownership of the 50/50 cold chain joint venture it formed with Lufthansa Cargo. Having taken full control of the business, called LifeConEx, DHL plans to continue cooperating with Lufthansa while expanding its cold chain service portfolio.
Roger Crook, CEO of DHL Global Forwarding, said: “After running the innovative specialised logistics service together for six years, DHL Global Forwarding and Lufthansa Cargo agreed that a change in ownership would best prepare LifeConEx to further grow its market position.”
The China expansion and takeover of LifeConEx both further the 2015 life sciences strategy created by DHL. Following the strategy is intended to equip DHL for predicted changes to the logistics sector.
“We are looking towards a future where governments, manufacturers and logistics services providers collaborate more actively to deliver a truly integrated supply chain”, Angelos Orfanos, president and global head of life sciences and healthcare at DHL, said.
Changes to biopharm logistics requirements, and why they encourage outsourcing, were discussed in a report by contract logistics provider Exel. Moving away from mass market, blockbuster drugs to niche, specialty therapies is reshaping practices in logistics and across the biopharm industry.
“These major trends translate into a need for greater flexibility to support more fragmented supply chains, increased specialty product handling requirements, and smaller, more frequent shipments”, Exel said.
In this environment it makes more sense to outsource supply than build in-house capacity, the report claims. Reducing in-house capacity should, in theory, allow biopharm to be flexible and respond to shifts in logistics requirements while lowering fixed costs.
“Finding a strategic partner to navigate the complexity, and to provide flexibility, risk management, and best practices are even more important considerations than cost”, the report said.