UPS and DHL Investing in New Cold-Chain Infrastructure

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Supply chain and logistics companies have a rising demand approaching and some of the key players are making quick moves. These companies are preparing for a boom in spending on complex pharmaceuticals that require temperature-controlled storage and shipping, called cold-chain infrastructure. With the recent surge of healthcare manufacturers moving toward more structurally-complex medicines, there is a need for more robust and efficient cold-chain distribution channels.

Pharmaceutical manufacturers have a pipeline of medicines waiting for approval from the FDA that should be released within the next 6-12 months. Many of these are considered more complex “biological- based’ medicines, as opposed to traditional chemical-based, over-the-counter, pill-based medication. Some of these will include hormone variations and cancer drugs that will require strict guidelines in temperature control during storage and transportation. Large logistics companies throughout the U.S. have been ramping up development of cold-chain facilities as this demand increases and pharmaceutical manufacturers are taking notice.

UPS and DHL have already made plans on investing in new cold-chain infrastructures in preparation for this boom in complex and biotechnology drugs. UPS just announced that it is building a healthcare distribution center in the Netherlands, shortly after opening an air freight facility in Amsterdam and acquiring a Polish pharmaceutical logistics company. DHL recently released a report citing multiple billions of dollars to be spent on specialty drugs, including those that require temperature-controlled shipping—which is up 121% since 2012. DHL has spent the last two years investing in cold-chain infrastructure; including more staff, warehouses and facilities with new packing stations monitored by the company’s pharmacists.

Though storing and transporting these medicines can be difficult, it is a crucial part of the healthcare supply chain. The industry needs a new generation of cold chain distribution channels to cope with the rising demand for pharmaceutical manufacturers. Ensuring that the medication gets to the end users in the right condition and on time requires a complex supply chain with attention given to quality management, product value, contingency capabilities, handling needs, customer service requirements and compliance rules. To learn more about cold-chain infrastructures, click here.