Logistics is the backbone of the medicines cold supply chain. Being able to preserve the clinical integrity of medicines in transport remains an exacting science; one which if mastered can shave costs and create spectacular competitive advantages.
Yet the pharmaceutical retail and supply landscape is ever-changing – new technologies, trends and medical breakthroughs impact on how and what we transport. Big data feeds, sensor networks and cloud-based computing is also affecting how managers keep squeezing volume out of an increasingly expensive cost centre.
Biological Pharmaceuticals (or bioengineered drugs/biologics) are drugs derived from living cells, and are a major growth sector for the pharmaceutical market. The total value of bioengineered drug products is more than $150 billion worldwide, three times what it was 10 years ago, with growth expected to be double the rate of traditional drugs. When you add vaccines, blood, plasma and a number of other cold-chain dependant pharma products, the overall biopharma cold-chain market is expected to exceed $250 billion. It is estimated that special logistical systems (such as wireless sensor networks and remote monitoring) for maintaining the quality of these highly temperature-sensitive products, accounts for more than 15% of all biopharma logistics spending.
The most prevalent drug on the horizon with regard to biopharma is nivolumab, a human monoclonal antibody, marketed under the name Opdivo and developed as a targeted treatment for certain forms of lung cancer. This bio-drug alone is projected to be a $6B product by 2020.
The clinical world is abuzz with a cellular therapy called CAR-T cell therapy, a radical new treatment for lymphoma. The clinical process involves extracting T cells from a patient, amending the cells’ genetics and then re-infusing them into the same patient. This logistical system is not only complicated by the fact that it is circular, but also by the fact that it requires sub-zero temperatures, and in some cases cryogenic freezing (typically temperatures below -150°C). Where once sub-zero temperatures were assiduously avoided, now specialist providers are designing entire logistical systems at hyper-low temperatures, to accommodate this growing pharmaceutical trend.
Counterfeits & Security
More and more counterfeit drugs are hitting the black market. The World Health Organisation estimated in 2010 that the worldwide sale of counterfeit medicines was worth $75B. Shockingly even lifesaving medicines such as prescription medicines for cancer and serious cardiovascular diseases are being counterfeited and sold to unsuspecting patients. Not only are patent holders losing billions of dollars, but patients are also being short-changed in the most cynical and life threatening way. Consequently, pharmaceutical companies have begun incorporating sophisticated tagging protocols to protect their products in transit. TruTag, for example, is a digitally tagged silica micro-particle that can be safely added to individual pills without amending the manufacturing process. These and other “single-dose” level security procedures are combined with increasing pressure on logistics companies to provide real-time, end-to-end, per batch tracking.
AI & Machine Learning
With big pharmaceutical mergers on a slowdown from the mega-merger year of 2015, companies are seeking momentum elsewhere. Enter a host of new technologies that could dramatically improve supply chain practices. Machine learning is a form of AI that uses big data sets to make decisions on its own, based on inputted strategies and formulas. For instance, if a shipment is tracked as being late or delayed, instead of simply creating an alert, an AI computer would learn to reassign or prioritise warehouse storage space or redirect the shipment along a less congested route - all without bothering an actual human being. Pharmaceutical companies are increasingly investing in suppliers that provide these and other remote monitoring and big data solutions.
The fast changing world of logistics combined with the exacting requirements of the pharmaceutical industry ensures that trends such as these will keep evolving and developing. Investment in improving systems and practices is understandably costly, and requires careful consideration. However, it is also clear that with the rapidly changing technological and clinical landscape - change is inevitable.