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The United States pharmaceutical 3PL market is expected to grow at a CAGR of 4.8% during the forecast period 2024-2032, driven by the rising demand for efficient, secure, and compliant pharmaceutical logistics in this region.
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Historical Year
Forecast Year
Pharmaceutical 3PL (or third-party logistics) consists of contracting out logistics and distribution tasks for pharmaceutical products to specialized providers. These providers oversee storage, shipping, stock control, wrapping, and order processing for secure and prompt delivery to different medical facilities and patients. Pharmaceutical 3PL services manage delicate products such as vaccines and specialty drugs in accordance with stringent regulatory requirements. There are three primary categories of pharmaceutical 3PL, namely, transportation-centered, warehouse/distribution-centric, and forwarder-centric, each providing various logistical solutions.
These services play a vital role in the pharmaceutical sector by ensuring efficient and safe product distribution, compliance with regulations, and enabling companies to concentrate on main tasks while cutting costs and improving supply chain management. Pharmaceutical 3PL providers oversee the distribution process by accepting products from manufacturers and storing them in warehouses with controlled temperatures. They are also responsible for managing reverse logistics and maintaining regulatory compliance across the supply chain.
These suppliers provide specific services such as serialization to combat counterfeiting and are essential allies for manufacturers in complying with intricate regulatory demands. They are crucial in managing sudden increases in demand, offering valuable insights using data analysis to improve inventory levels and increase operational efficiency.
Rising Prevalence of Chronic Diseases Drives Market Growth
The rising occurrence of long-term illnesses such as diabetes, heart disease, and cancer is driving the demand for pharmaceutical 3PL services. In February 2024, a study published by the US Department of Health and Human Services found that approximately 129 million people in the United States have at least one major chronic disease. Five of the top 10 leading causes of death in the country are preventable or treatable chronic diseases. There is an increasing number of patients who need long-term medication, leading to a need for efficient distribution. Dealing with chronic illnesses frequently requires specific medications, requiring intricate logistical solutions. Pharmaceutical third-party logistics (3PL) providers are prepared to meet these needs, guaranteeing secure and effective distribution of drugs to support market expansion.
Adoption of Cold Chain Logistics to Boost United States Pharmaceutical 3PL Market Demand
The need for cold chain logistics in the pharmaceutical industry is on the rise as more temperature-sensitive products such as vaccines, biologics, and specialty drugs are being produced. In early September 2024, UPS, a US-based company announced the acquisition of Frigo-Trans and BPL, which are leading healthcare logistics capabilities with cold-chain providers in Germany, to enhance their European capabilities for temperature-sensitive and time-critical logistics services for UPS Healthcare customers. The emergence of personalized medicine and biologics has raised the demand for more sophisticated cold chain solutions.
The market is witnessing several trends and developments to improve the current scenario. Some of the notable trends are as follows:
Integration of Advanced Technologies
The incorporation of cutting-edge technologies like AI, blockchain, and IoT is fueling expansion in the US Pharmaceutical 3PL sector. AI facilitates demand prediction and route mapping, while blockchain guarantees transparency in the supply chain. The increasing adoption of IoT gadgets helps in overseeing the condition of shipments. The efficiency and visibility provided by these technologies improve the reliability and attractiveness of pharmaceutical 3PL services for manufacturers. For instance, McKesson's third-party logistics (3PL) services have proven themselves responsible for biopharma progress. The company’s advanced logistics sector ensures that biopharma companies can distribute and sell their products more effectively and ensure timely deliveries of critical treatments to their patients.
Focus on Sustainable Logistics
The pharmaceutical sector prioritizes sustainable logistics to reduce the environmental burden. 3PL companies in the pharmaceutical industry are implementing environmentally friendly measures such as employing electric or fuel-efficient vehicles and optimizing delivery routes to reduce carbon emissions. Energy-efficient storage solutions are also being put into practice as well as a transition into using eco-friendly packaging materials to decrease the amount of waste generated.
Strategic Partnerships and Collaborations
Pharmaceutical 3PL providers are collaborating with pharmaceutical companies, technology providers, and other logistics firms to improve service offerings and operational efficiency. These partnerships enable the incorporation of sophisticated tracking systems to ensure secure delivery of products and enhance geographic coverage for enhanced final-mile delivery. Strategic partnerships enhance the value chain by providing comprehensive solutions for pharmaceutical manufacturers' changing requirements, resulting in improved customer service and market expansion.
Growth in Outsourcing by Small and Medium Enterprises
Small and medium-sized pharmaceutical companies are opting to use third-party logistics providers to reduce expenses, enhance effectiveness, and focus on their core competencies. These companies do not have the required resources and infrastructure to manage complex logistics, especially for products that need temperature control. By utilizing pharmaceutical logistical services, they can utilize knowledge, connections, and technology to adhere to regulations, mitigate risks, and efficiently distribute products to medical professionals and individuals.
Market Breakup by Service Type
Market Breakup by Supply Chain
Market Breakup by End Use
Market Breakup by Region
Market Segmentation based on Supply Chain is Anticipated to Witness Substantial Growth
Based on the supply chain, the market is divided into cold chain and non-cold chain. Out of these, cold chain services are expected to dominate the market due to the increasing demand for temperature-sensitive products such as biologics, vaccines, and specialty drugs. Accurate temperature control is vital to ensure the effectiveness and safety of these products during shipping, highlighting the importance of cold chain logistics. The increasing popularity of biologics and personalized medicines is projected to increase the need for dependable cold chain services, leading to expansion in this segment of the 3PL industry.
The Southeast region holds the largest market share in the United States, owing to the dense population, robust healthcare infrastructure, and the presence of many pharmaceutical manufacturing and distribution centers. This area houses multiple healthcare facilities, research institutions, and specialty clinics, leading to a need for effective pharmaceutical logistics. Furthermore, its advanced transportation networks and strategic positioning also make it a perfect center for pharmaceutical distribution.
The key features of the market report include patent analysis, grant analysis, funding, and investment analysis as well as strategic initiatives by the leading players. The major companies in the market are as follows:
Kerry Logistics
Kerry Logistics is a listed company offering third-party logistics, freight, warehouse, and supply chain services. They prioritize the safe handling of pharmaceutical products and meet industry demands for transporting life-saving goods like vaccines and medical devices with strict safety standards, regulatory compliance, and end-to-end solutions for various industries.
United Parcel Service, Inc.
UPS is a US-based shipping, and supply chain company founded in 1907 as American Messenger Company, headquartered in Atlanta. In early September 2024, UPS announced the acquisition of Frigo-Trans and BPL, leading healthcare logistics capabilities with cold-chain providers in Germany, to enhance their European capabilities for temperature-sensitive and time-critical logistics services for UPS Healthcare customers.
DHL International GmbH
DHL is a global logistics company headquartered in Bonn, Germany, with United States based roots. They specialize in cold chain technologies for shipping pharmaceuticals , ensuring the right temperature for life-saving efficacy. DHL Medical Express offers a comprehensive cold chain logistics solution for sensitive medical products.
C.H. Robinson Worldwide Inc.
C.H. Robinson Worldwide is an American transportation company specializing in third-party logistics. They provide freight transportation, management, brokerage, and warehousing services through partnerships with motor carriers, railroads, and ocean/air carriers.
*While we strive to always give you current and accurate information, the numbers depicted on the website are indicative and may differ from the actual numbers in the main report. At Expert Market Research, we aim to bring you the latest insights and trends in the market. Using our analyses and forecasts, stakeholders can understand the market dynamics, navigate challenges, and capitalize on opportunities to make data-driven strategic decisions.*
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REPORT FEATURES | DETAILS |
Base Year | 2023 |
Historical Period | 2017-2023 |
Forecast Period | 2024-2032 |
Scope of the Report |
Historical and Forecast Trends, Industry Drivers and Constraints, Historical and Forecast Market Analysis by Segment:
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Breakup by Service Type |
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Breakup by Supply Chain |
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Breakup by End User |
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Breakup by Region |
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Market Dynamics |
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Supplier Landscape |
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Companies Covered |
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