According to the DHL report “Delivering Next Level Healthcare,” the life sciences and medical industries are undergoing a transformation driven by various factors. The document analyzes the ongoing changes, taking into account major sector trends such as patient-centric healthcare, the introduction of sustainable solutions, and the creation of new industry ecosystems. It also presents how supply chains are responding and what challenges are being posed to logistics companies.
Increased demand for the cold chain
DHL’s analysis shows that the way patients search for, choose, and access treatment is changing. As it turns out, 90% of Gen Z patients search online for information about healthcare costs and available options before visiting a doctor[1]. So-called decentralized clinical trials (DCT) are gaining popularity – 89% of entities funding them use technology in at least one clinical trial[2] to enable them to be conducted outside of centers. This translates into higher efficiency compared to trials requiring presence at a clinic – in this case, reduced “human flow” can be replaced by increased transport of medical products to an even more diverse market.
Demographic and industry trends are also driving changes in the patient healthcare segment. The industry is affected by, among other things, pressure on public healthcare spending, an aging population, and growing consumer concern for health and well-being. Furthermore, new service standards and subscription models for medical products are emerging, increasing e-commerce sales volumes and introducing new product categories. This creates additional requirements for supply chain management and logistics.
One can also observe the development of new therapeutic methods, including biopharmaceutical products and gene-based medicine. It is predicted that the market for such therapies will grow from approximately $5 billion in 2012 to nearly $37 billion in 2027. Biopharmaceutical products are delicate and expensive, so they must be handled with care at every stage of the supply chain. Consequently, the pharmaceutical industry invests over $17 billion annually in cold chain logistics. This has led to the creation of a diverse range of logistics services in this segment, which include shipments requiring temperatures as low as -196°C for ultra-cold products[3].
– At DHL Express, a company handling international express air shipments, transport from the life science and medical sector accounts for about 10% of our portfolio. Therefore, we realize how demanding this sector is. Primarily in terms of temperature-sensitive goods, which must be in appropriate packaging that allows for maintaining the correct temperature during transport. That is why we have created a wide range of solutions in this area, including the DHL Medical Express service, ensuring fast and safe delivery of samples for laboratory tests, biological material, or medical devices – says Edwin Osiecki, Vice President of Sales and Marketing at DHL Express Poland.
Focus on sustainable development
Like every other industry, the healthcare sector is looking for opportunities to reduce its environmental impact. It currently accounts for 4-5% of global CO2 emissions and generates 300 million tons of plastic annually. Interestingly, the pharmaceutical sector emits more carbon dioxide than the global automotive industry. Solutions proposed by logistics companies, such as the use of sustainable fuels, can help the healthcare industry reduce its negative environmental impact. DHL Express is one of the first carriers to decide to implement them. This enabled the introduction of the GoGreen Plus service. It is the first service of its kind among global carriers that allows customers to reduce carbon emissions associated with the transport of their shipments, precisely through the use of sustainable aviation fuel (SAF).
Different healthcare sectors require different logistics solutions
The identified trends are changing the way healthcare is provided – especially in the area of medical devices, private healthcare, pharmaceuticals, clinical trials, and government and non-governmental organizations. These transformations pose new and sometimes diverse requirements for healthcare supply chains, introducing an element of complexity to existing processes or forcing the adoption of entirely new models. This applies to both better transparency and distribution control over supply chain segmentation and distribution channels, as well as rigorous protection of shipments and comprehensive real-time status monitoring to ensure system reliability. As a result of vaccine shortages during the COVID-19 pandemic, countries are considering a complete reform of logistics processes. This includes analyzing the possibilities of increasing domestic production of key healthcare goods, stockpiling, and shifting to more vaccine shipments to remote regions with poorly developed infrastructure.
Shaping a new supply chain
In its publication, DHL shared key aspects that companies should consider when shaping their supply chain for the future. These are: cold chain capabilities, White Glove services (comprehensive transport and delivery service from packaging to delivery and unloading, tailored to customer expectations), direct-to-consumer delivery models, supply chain digitalization, sustainable solutions, inventory optimization, and regulatory compliance. It is worth for companies to, among other things, prioritize the scalability, versatility, and efficiency of their cold chain networks to effectively meet changing requirements.
– Patients now expect the same level of choice and convenience in healthcare as they do when purchasing other products and services. This includes online orders or direct home deliveries. Therefore, it is necessary to create logistics solutions that provide a high level of service and can meet consumer needs – adds Edwin Osiecki.
A major challenge is cell therapies based on a person’s own blood, which requires a strictly controlled supply chain. Ensuring that personalized medical treatments reach the right patient every time involves introducing rigorous requirements. Since these procedures are still relatively rare in clinical settings, the last-mile service must be seamless, intuitive, and developed according to the needs of the patient and their doctor. Understanding how supply chains will operate in the future will enable companies to identify the necessary capabilities.
[1] Fierce Healthcare. Gen Zers, millennials feeling impacts of COVID-19 on health coverage, costs: TransUnion. https://www.fiercehealthcare.com/payer/transunion-survey-gen-zers-millennials-feeling-impacts-covid-19-health-coverage-costs#:~:text=The%20vast%20majority%20of%20Gen,making%20choices%20based%20on%20costs
[2] Contract Pharma. Why decentralized clinical trials remain a black box to most research sites, https://www.contractpharma.com/contents/view_experts-opinion/2022-03-18/why-decentralized-clinical-trials-remain-a-black-box-to-most-research-sites/#:~:text=Recent%20data%20shows%20that%2089,one%20of%20their%20clinical%20trials
[3] Biopharma dive. The evolving demands of the temperature-controlled supply chain for cell and gene therapy. https://www.biopharmadive.com/spons/the-evolving-demands-of-the-temperature-controlled-supply-chain-for-cell-an/567146/#:~:text=Cell%20and%20gene%20therapies%20are%20typically%20stored%20at%20cryogenic%20temperatures,the%20cell%20or%20gene%20therapy .
The full version of the “Delivering Next Level Healthcare” report in English is available on the website: https://www.dhl.com/global-en/campaign/delivering-next-level-healthcare.html
Source: GRAYLING, DHL Express