Future-proofing the pharma cold chain

As India's pharma sector undergoes a transformative shift, an agile and scalable cold chain characterised by innovative approaches, intelligent infrastructure, and collaborative practices will be key to progress

The growing emphasis on a resilient supply chain in pharma and life sciences has brought the temperature-controlled supply chain, known as the cold chain, into the spotlight. The COVID-19 pandemic also highlighted the vital role of the cold chain in ensuring patient safety during vaccine distribution.

And, with India’s vaccine, biopharma, and clinical trials market projected to grow in double-digits, there will be an increasing demand for efficient cold chain facilities.

As per Research and Markets, Indian cold chain market size reached Rs 1,814.9 billion in 2022. The market is expected to reach Rs 3,798.7 billion by 2028, exhibiting a CAGR of 13.1 per cent during 2022-2028.

So, in this article, we delve into this dynamic market to explore the driving factors behind its exponential growth and the trends shaping the market landscape while evaluating the pain points that need to be addressed for sustained growth.

Let’s take a look at some of the factors that are driving growth in this segment:

Gaps in supply infrastructure: The healthcare sector’s escalating demand for dependable cold chain facilities to safeguard temperature-sensitive products such as vaccines, biopharmaceuticals, and clinical trial materials is fuelling the cold chain industry’s expansion.

And, as a report from Accenture titled, ‘The New Ice Age: Creating a flexible, intelligent pharma cold chain’ highlights the global scenario, “The total market value of pharma products is expected to be $1.7 trillion by 2024, with 30 per cent representing the cold chain portfolio. This means cold chain capabilities would need to grow in parallel with therapeutic innovations to satisfy patient demand.”

However, significant gaps exist in India’s pharma cold chain infrastructure, particularly in transportation, storage, and power supply. Inadequate road, rail and air networks, sub-optimal storage conditions, outdated technology etc. impede efficient logistics of pharma products. At the same time, the Indian cold chain market is also highly fragmented with over 3,500 companies. Organised players make up only 8 to 10 percent of the cold chain industry market.

Recognising the importance in tackling cold chain challenges, investments in cold chain infrastructure is likely to increase. Logistics companies are already expanding their capacity for temperature-controlled storage and transportation to meet the growing demand.

To cite a few examples:

  • IndoSpace and Koolex have collaborated to design and set up three warehouses in proximity to Mumbai, Delhi and Bangalore. Each will have 36,000 pallet positions.

  • FedEx has invested in healthcare supply chain and cold chain capabilities with over 90 cold chain facilities worldwide. They offer tailored solutions for transport of temperature-controlled healthcare shipments within India to over 6,000 postal codes

Packaging innovations: The transportation and storage of various temperature-sensitive pharmaceuticals, biologics, and clinical trial materials continue to require advanced packaging solutions. They play a vital role in ensuring the integrity and stability of temperature-sensitive pharma products throughout the cold chain. This has presented an ongoing market opportunity for packaging providers to develop and deliver cutting-edge packaging solutions that ensure product integrity, regulatory compliance, and patient safety.

Thus, packaging innovations ranging from ultra-cold shipping containers with advanced insulation to temperature-monitoring devices and data loggers that enable real-time tracking and monitoring of vaccine shipments have witnessed a rise in the pharma cold chain sector to prevent and mitigate temperature excursions and serve the needs of the life sciences and healthcare industry.

Kami Viswanathan, Senior VP of FedEx Express Middle East, Indian Subcontinent and Africa (MEISA) Operations confirms, “The emerging trends in pharma cold chain packaging are driven by increasing adoption of temperature monitoring and data logging to track temperature variations, provide real time visibility, and traceability, such as the FedEx SenseAware device which integrates IoT technology for near real-time monitoring, ensuring visibility and product integrity.”

She adds, “Companies are developing customised solutions that account for the unique temperature requirements, sensitivity, and fragility of different drugs. For example, reusable FedEx Vacuum Insulated Packaging, frozen gel packs, and PCM cooling technology helps ensures optimal protection, reducing the risk of temperature deviations in a sustainable fashion.”

Future Market Insights predicts a robust growth rate of 14.8 per cent from 2023 to 2033, compared to 13.3 per cent from 2016 to 2022 for the pharma cold chain packaging segment in India.

Technology advancements: Technologies like big data, predictive analysis, and AI is ushering significant benefits to the pharma sector’s cold supply chain. Real-time temperature-monitoring and control in smart storage warehouses, facilitated by AI, robotics and IoT, are facilitating accurate and consistent temperature-controlled environments, reducing the risk of product spoilage. Digital adoption is streamlining operations, reducing paperwork, and improving transparency. Drones and self-driving vehicles are enabling last-mile deliveries to remote areas while maintaining optimal temperature control. IoT-enabled vehicles make real-time tracking and monitoring of both the vehicle and its contents possible, ensuring the integrity of medical supplies.

Vishwanathan reiterates, “The future of cold chain pharma packaging in India is being shaped by several technological advancements and innovations. Companies like FedEx Express are integrating cutting edge technological solutions such as Blockchain, Automation, and IoT to revolutionise the field. We are using advanced analytics and real-time data to transform collection and delivery predictions, optimising routes for efficient transportation. Machine learning and analytics identify opportunities for delivery efficiency, ensuring product integrity within the cold chain. Proprietary tracking systems like FedEx SenseAware enable near real-time monitoring, giving customers visibility and control.”

Dinesh Tarachandani, Head – Global Logistics, DP World Subcontinent, in an earlier article shared with Express Pharma, informs, “With pharma industry accelerating its digital transformation journey, the supply chain services providers have also increased their focus on driving innovations backed by data to strengthen the pharma and medical logistics. For instance, DP World’s production management and business intelligence tools provide enhanced visibility and control across the supply chain, thereby supporting optimum decision making. Furthermore, company’s suite of digital technologies is helping our customers identify bottlenecks in their supply chains and smooth the flow of medical supplies across borders.”

Thus, from optimised route planning to real-time temperature monitoring, streamlined operations, and advanced last-mile delivery solutions, emerging technologies are enhancing efficiency, reducing costs, and improving product integrity.

Conducive policies: Favorable government policies are also driving growth in the industry.

The supply chain in post-COVID times is being shaped, in part, by government policies. In September 2022, the Central Government announced the National Logistics Policy with the objective of lowering the cost of logistics, increasing the competitiveness of Indian products in domestic and international markets, and improving the efficiency of industries. India’s pharma MSMEs will benefit from the reduction in logistics costs. The establishment of multi-modal logistics parks, as proposed in the policy, will improve last-mile connectivity, and strengthen the cold storage and warehousing infrastructure across the country,” states Tarachandani.

He adds, “In the pharma supply chain, products are usually sent to C&F agents, then to city-level distributors, and ultimately to retailers. Since much of this happens at a local level, it can cause compliance issues, especially when it concerns medicines that need to be transported and stored at specific temperatures. This is because, in India, temperatures can vary widely across states, and even within cities in the same state. The newly proposed storage and warehousing policies will guide the ongoing efforts of pharma and logistics companies in addressing such issues by increasing the accessibility of the cold chain infrastructure and enhancing the connectivity to the storage areas through multimodal connectivity.”

Jesal Doshi, Deputy CEO of B Medical Systems, says, “Government initiatives such as the Scheme for Cold Chain & Value Addition Infrastructure, Pradhan Mantri Kisan Sampada Yojana (PMKSY) and Backward & Forward Linkages are encouraging investment in the cold chain sector and driving technological innovation. These initiatives aim to improve infrastructure, promote the adoption of new technologies, and support the growth of the cold chain pharma logistics market in India.”

Strategic partnerships: “As the costs and complexities of healthcare and pharma logistics continue to rise, pharma companies need logistics partners who can mitigate any adverse impacts on their business and on patients. The ability to leverage relationships, network, experience and skills is crucial to ensure that access to quality healthcare remains equitable across the globe. Partnering with logistics providers can yield significant benefits for pharma companies on both the business and the consumer health fronts,” points out Tarachandani.

Companies offering cold chain solutions and services to the pharma sector must proactively prepare for the future. In this milieu, the importance of cooperation and collaboration among systems and organisations for the transportation of temperature-controlled pharma products become very crucial. Existing capabilities may not be inadequate to meet future requirements and satisfy expectations of the life sciences companies in terms of visibility, quality assurance, flexibility, and efficient execution.

Players who can offer services in security, traceability and other related services throughout the supply chain with the help of the right skills, infrastructure and technology will gain a competitive edge and become preferred partners for the pharma and healthcare industry.

Growth opportunities galore

Abundant opportunities await players seeking to tap into the increasing demand for cold chain pharma logistics services in India. But, how can the players optimise the growth potential?

Doshi advises, “The Indian cold chain pharma logistics market presents a wealth of opportunities for companies that are willing to take a strategic and proactive approach. By expanding your presence, offering specialised services, investing in infrastructure development, adopting new technologies, and engaging with government agencies, you can capitalise on these opportunities and position your company for long-term success.”

Building an intelligent and patient-centric cold chain is an imperative for life sciences companies and their logistics partners. And, this calls for a proactive mindset, the right strategy, pivotal partnerships and significant investments. All stakeholders in the pharma cold chain need to consider broader implications for their present and future needs and adopt an approach that encompass product quality assurance, regulatory compliance, data monitoring, and sustainability.



B Medical Systemscold chain pharma logisticsDHLFedEx ExpressNational Logistics Policypharma cold chainpharma supply chainvaccine distribution
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