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Business opportunities: Higher volumes and expert services
The demand for cold chain logistics services is growing steadily across the globe caused by the increase of biologics and other temperature sensitive pharmaceuticals. According to EvaluatePharma World Preview the compounded growth will exceed 6% until 2024 (+6.4% CAGR 2018-2024). Logistics suppliers that want to maintain or gain a share of that growth within the pharmaceutical vertical must respond by ensuring available capacity as well as the expert logistics services that are required for safe transport.
Cold chain - an active choice
New regulatory requirements require that the method of transport must be specified in new drug applications. Consequently, both pharmaceutical companies and logistics providers should be prepared and have a transport and packaging solution that meets these requirements while offering them flexibility to safely ship temperature sensitive products in various conditions and multiple trade lanes. Having such a solution in place years before a new medicine is on the market will help the provider to gain the advantage and an active cold chain is the safest solution to meet these requirements.
Here are the top five benefits when you combine the active cold chain and pharmaceutical air freight:
1. Higher freight rates and predictable revenues
Because of the specialized services airlines offer with the active cold chain, they can charge a premium for their pharmaceutical air freight. These higher rates make pharmaceutical air freight more attractive to the bottom line. Additionally, the steps required to qualify a trade-lane segment by a pharmaceutical company are costly and time consuming. This means that the cost to change an airline is high and thus airlines can rely on predictable volumes and revenues from this vertical.
To build a strong brand in pharma air freight it is important that the airline can offer high-quality services and is capable of minimizing risk when handling high-value products.
2. Airlines build brand loyalty with specialized services
To build a strong brand in pharma air freight it is important that the airline can offer high-quality services and is capable of minimizing risk when handling high-value products. By working within the active cold chain, the airline can develop specialized services bringing extra benefits to the customer. Proactive monitoring of the temperature inside the container during transport allows the airline to intervene before any indications that the product temperature could deviate from specifications. Shipment reports can then be used to evaluate shipments, identify risks and provide opportunity for continuous improvements.
3. A means to handle capacity constraints during peak season
Another advantage of an active cold chain is the efficient utilization of available capacity, which could help solve capacity constraints during peak season. The insulation materials in passive cold chain packaging take up a large volume per kilogram shipped, whereas active temperature-controlled containers are more space efficient and allow for more volume of the actual products to be shipped in one container. More volume per container will thus lead to fewer positions being used on the aircraft and more available capacity for additional customers. For the pharmaceutical industry, year-end is critical to have sales included in their annual reports. Air capacity is a constant concern for pharmaceutical companies and using the active cold chain can help pharmaceutical companies solve recurrent capacity challenges.
4. More secure shipments
Unforeseen events during transportation can have a negative impact on product quality. According to the International Air Transport Association (IATA), 20% of temperature-sensitive medicines are impacted due to temperature excursions during transportation.
Therefor airlines should provide high-quality services in order to build a strong brand in pharmaceutical air transportation. An active cold chain is the service with the highest probability of safe delivery because the use of Active ULDs will help mitigate risks. Rechargeable batteries will withstand shipment delays while active heating and cooling ensues proper product temperature in the event of extreme ambient temperatures during storage or on the tarmac.
5. Cost effective solution
Active temperature-controlled containers are leased which mean they are re-used over their life-span of 10-15 years, thus significantly reducing packaging waste. They also require fewer man-hours during set-up and transportation which lowers costs otherwise incurred by handling, storage, and loading. Airlines who offer the active cold chain, offer a product to the pharma logistics market that is more cost effective than its competitors. In addition, they take up considerably less space compared to passive packaging, which subsequently lead to cost savings for the logistics supply chain.
