The cold-chain biopharma market is expanding at a CAGR of 6%

Specialist providers in this niche market segment are benefitting from improving industry fundamentals (eg. strong growth in biopharma sales), and also now from tighter regulations and compliance requirements across the European Union.

Growth in cold-chain pharma:

  • By 2021, the cold-chain pharma market is forecast to be worth $16.6 billion, which implies a five-year CAGR of 6%.
  • The industry is being supported by a steady and sustained increase in the number of bio-engineered drugs coming to market: by 2020, 27 of the 50 top selling drugs will be temperature-sensitive biologics, requiring cold-chain storage & transportation between 2-8 °C.
  • New EU regulations issued in November 2017, titled Good Distribution Practices, ensure that the quality of medicines are maintained throughout the supply chain, and impose much stricter rules on how temperature-sensitive pharma products are treated. We expect specialist T&L providers in cold chain pharma who can guarantee compliance will benefit at the cost of lower-cost generalists.
  • Players who can provide additional related services such as security, reliability and traceability (eg. digital monitoring) throughout the supply chain are highly sought after by pharma customers.

The value-add in cold-chain pharma:

  • Ensuring consistent temperatures is not always easy, nor is it cheap.
  • Biopharma products can also have short expirations, which require reliable and speedy handling.
  • Manufacturers and distributors in different regions of the world have different standards, and therefore differences in environmental conditions. Specialists understand the risks for temperature-sensitive drugs being transported from China & India to the EU, for example; or for air-cargo, where there is often a disjointed relationship between airlines and ground-handling agents.
  • Pharma manufacturers produce high-value goods which are prime targets for theft. Specialists can deliver higher levels of security and traceability (eg. digital monitoring) throughout the supply chain.
Kilian de Gourcuff
Kilian de Gourcuff
Partner
France