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Feature Article December 5, 2012

Cold chain outsourcing growth anticipated in Asia, Latin America

Bayer Healthcare project manager discusses emerging markets for pharmaceutical logistics and distribution outsourcing.
Air shipment

As the pharmaceutical industry seeks to outsource non-core activities, it creates a great opportunity for innovative solution providers to go beyond basic freight management.

“Outsourcing has been called ‘one of the greatest organizational and industry structure shifts of the century,’ with special influence in the pharma industry, where pharmaceutical and biotechnology companies are outsourcing at almost every stage of the value chain,” said Pharma IQ columnist Cristina Falcão.

In her column, “Pharmaceutical Outsourcing, Where Do You Draw The Line?” she highlights the merits outsourcing in pharmaceutical logistics and distribution. “Outsourcing supply chain operations to a third-party logistics [3PL] provider allows pharmaceutical companies to retain competitive advantage and overcome the counterfeiting issue. The outsourced partner must have cold chain management specialists, securing biotech and pharmaceutical companies’ strict regulatory compliance and product control, and concur to supply chain visibility and control,” she said.

In a recent interview, Cold Chain IQ asked Carlos Castro, transportation/cold chain project manager at Bayer Healthcare where he expected to see the most growth in the temperature-controlled freight forwarding market in the next five to 10 years.

He said, “From my experience, I think the biggest growth I’ve seen is Asia Pacific, as well as Latin America. There’s been some growth in the Middle East and I believe North Africa will also have a great increase, but I suspect that the biggest increase will continue to be in Asia Pacific and Latin America, if you look at the so-called BRIC countries we’re talking about—Asia Pacific, Latin America, and then some of Eastern Europe.”

Castro recently commented on the increased movement of freight forwarders into emerging regions. He said: “As companies are moving to emerging countries, so are freight forwarders. Freight forwarders and carriers are quickly developing expertise to remain competitive because most companies prefer to deal with one to two freight forwarders to handle distribution to all countries.”

Due to increased regulatory scrutiny, it can be difficult to find the right outsourcing partner in emerging markets, as they must also comply with new regulations and ensure supply chain integrity and visibility.

Article contributed by Andrea Charles, Cold Chain IQ

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