United States Pharmaceutical 3PL Market Size and Share - Outlook Report, Forecast Trends and Growth Analysis (2024-2032)

United States Pharmaceutical 3PL Market Outlook

• A study published in February  2024 reported that approximately 129 million people in the US have at least one major chronic disease. Pharmaceutical 3PL guarantees secure and effective distribution of drugs, supporting market expansion.
• The surge in the production of temperature-sensitive products such as vaccines, biologics, and specialty drugs is expected to boost the market demand for pharmaceutical 3PL.
• The growing collaboration between pharmaceutical 3PL providers and pharmaceutical companies, technology providers is one of the major trends, likely to elevate the market value.

United States Pharmaceutical 3PL Market Overview

Pharmaceutical 3PL (or third-party logistics) consists of contracting out logistics and distribution tasks for pharmaceutical products to specialized providers. These providers oversee storage, shipping, stock control, wrapping, and order processing for secure and prompt delivery to different medical facilities and patients. Pharmaceutical 3PL services manage delicate products such as vaccines and specialty drugs in accordance with stringent regulatory requirements. There are three primary categories of pharmaceutical 3PL, namely, transportation-centered, warehouse/distribution-centric, and forwarder-centric, each providing various logistical solutions.

These services play a vital role in the pharmaceutical sector by ensuring efficient and safe product distribution, compliance with regulations, and enabling companies to concentrate on main tasks while cutting costs and improving supply chain management. Pharmaceutical 3PL providers oversee the distribution process by accepting products from manufacturers and storing them in warehouses with controlled temperatures. They are also responsible for managing reverse logistics and maintaining regulatory compliance across the supply chain.

These suppliers provide specific services such as serialization to combat counterfeiting and are essential allies for manufacturers in complying with intricate regulatory demands. They are crucial in managing sudden increases in demand, offering valuable insights using data analysis to improve inventory levels and increase operational efficiency.

United States Pharmaceutical 3PL Market Growth Drivers

Rising Prevalence of Chronic Diseases Drives Market Growth

The rising occurrence of long-term illnesses such as diabetes, heart disease, and cancer is driving the demand for pharmaceutical 3PL services. In February  2024, a study published by the US Department of Health and Human Services found that approximately 129 million people in the United States have at least one major chronic disease. Five of the top 10 leading causes of death in the country are preventable or treatable chronic diseases. There is an increasing number of patients who need long-term medication, leading to a need for efficient distribution. Dealing with chronic illnesses frequently requires specific medications, requiring intricate logistical solutions. Pharmaceutical third-party logistics (3PL) providers are prepared to meet these needs, guaranteeing secure and effective distribution of drugs to support market expansion.

Adoption of Cold Chain Logistics to Boost United States Pharmaceutical 3PL Market Demand

The need for cold chain logistics in the pharmaceutical industry is on the rise as more temperature-sensitive products such as vaccines, biologics, and specialty drugs are being produced. In early September  2024, UPS, a US-based company announced the acquisition of Frigo-Trans and BPL, which are leading healthcare logistics capabilities with cold-chain providers in Germany, to enhance their European capabilities for temperature-sensitive and time-critical logistics services for UPS Healthcare customers. The emergence of personalized medicine and biologics has raised the demand for more sophisticated cold chain solutions.

United States Pharmaceutical 3PL Market Trends

The market is witnessing several trends and developments to improve the current scenario. Some of the notable trends are as follows:

Integration of Advanced Technologies

The incorporation of cutting-edge technologies like AI, blockchain, and IoT is fueling expansion in the US Pharmaceutical 3PL sector. AI facilitates demand prediction and route mapping, while blockchain guarantees transparency in the supply chain. The increasing adoption of IoT gadgets helps in overseeing the condition of shipments. The efficiency and visibility provided by these technologies improve the reliability and attractiveness of pharmaceutical 3PL services for manufacturers. For instance, McKesson's third-party logistics (3PL) services have proven themselves responsible for biopharma progress. The company’s advanced logistics sector ensures that biopharma companies can distribute and sell their products more effectively and ensure timely deliveries of critical treatments to their patients.

Focus on Sustainable Logistics

The pharmaceutical sector prioritizes sustainable logistics to reduce the environmental burden. 3PL companies in the pharmaceutical industry are implementing environmentally friendly measures such as employing electric or fuel-efficient vehicles and optimizing delivery routes to reduce carbon emissions. Energy-efficient storage solutions are also being put into practice as well as a transition into using eco-friendly packaging materials to decrease the amount of waste generated.

Strategic Partnerships and Collaborations

Pharmaceutical 3PL providers are collaborating with pharmaceutical companies, technology providers, and other logistics firms to improve service offerings and operational efficiency. These partnerships enable the incorporation of sophisticated tracking systems to ensure secure delivery of products and enhance geographic coverage for enhanced final-mile delivery. Strategic partnerships enhance the value chain by providing comprehensive solutions for pharmaceutical manufacturers' changing requirements, resulting in improved customer service and market expansion.

Growth in Outsourcing by Small and Medium Enterprises

Small and medium-sized pharmaceutical companies are opting to use third-party logistics providers to reduce expenses, enhance effectiveness, and focus on their core competencies. These companies do not have the required resources and infrastructure to manage complex logistics, especially for products that need temperature control. By utilizing pharmaceutical logistical services, they can utilize knowledge, connections, and technology to adhere to regulations, mitigate risks, and efficiently distribute products to medical professionals and individuals.

United States Pharmaceutical 3PL Market Segmentation

Market Breakup by Service Type

• Transportation
• Warehousing
• Packaging
• Others

Market Breakup by Supply Chain

• Cold Chain
• Non-Cold Chain

Market Breakup by End Use

• Manufacturers
• Wholesalers
• Hospitals and Clinics
• Others

Market Breakup by Region

• Northeast
• Southeast
• Midwest
• Southwest
• West

United States Pharmaceutical 3PL Market Share

Market Segmentation based on Supply Chain is Anticipated to Witness Substantial Growth

Based on the supply chain, the market is divided into cold chain and non-cold chain. Out of these, cold chain services are expected to dominate the market due to the increasing demand for temperature-sensitive products such as biologics, vaccines, and specialty drugs. Accurate temperature control is vital to ensure the effectiveness and safety of these products during shipping, highlighting the importance of cold chain logistics. The increasing popularity of biologics and personalized medicines is projected to increase the need for dependable cold chain services, leading to expansion in this segment of the 3PL industry.

United States Pharmaceutical 3PL Market Analysis by Region

The Southeast region holds the largest market share in the United States, owing to the dense population, robust healthcare infrastructure, and the presence of many pharmaceutical manufacturing and distribution centers. This area houses multiple healthcare facilities, research institutions, and specialty clinics, leading to a need for effective pharmaceutical logistics. Furthermore, its advanced transportation networks and strategic positioning also make it a perfect center for pharmaceutical distribution.

The key features of the market report include patent analysis, grant analysis, funding, and investment analysis as well as strategic initiatives by the leading players. The major companies in the market are as follows:

Kerry Logistics

Kerry  Logistics is a listed company offering third-party logistics, freight, warehouse, and supply chain services. They prioritize the safe handling of pharmaceutical products and meet industry demands for transporting life-saving goods like vaccines and medical devices with strict safety standards, regulatory compliance, and end-to-end solutions for various industries.
 
United Parcel Service, Inc.

UPS is a US-based shipping, and supply chain company founded in 1907 as American Messenger Company, headquartered in Atlanta. In early September  2024, UPS announced the acquisition of Frigo-Trans and BPL, leading healthcare logistics capabilities with cold-chain providers in Germany, to enhance their European capabilities for temperature-sensitive and time-critical logistics services for UPS Healthcare customers.

DHL International GmbH

DHL is a global logistics company headquartered in Bonn, Germany, with United States based roots. They specialize in cold chain technologies for shipping pharmaceuticals , ensuring the right temperature for life-saving efficacy. DHL Medical Express offers a comprehensive cold chain logistics solution for sensitive medical products.

C.H. Robinson Worldwide Inc.

C.H. Robinson Worldwide is an American transportation company specializing in third-party logistics. They provide freight transportation, management, brokerage, and warehousing services through partnerships with motor carriers, railroads, and ocean/air carriers.

Key Questions Answered in the United States Pharmaceutical 3PL Market Report

• What was the United States pharmaceutical 3PL market value in 2023?
• What are the United States pharmaceutical 3PL market forecast outlook for 2024-2032?
• What are the regional markets covered in the EMR report?
• What is market segmentation based on the supply chain?
• What is market segmentation based on end use?
• What is the market breakup based on the service type?
• What are the major factors aiding the United States pharmaceutical 3PL market demand?
• How has the market performed so far and how is it anticipated to perform in the coming years?
• What are the major drivers, opportunities, and restraints in the market?
• What are the major trends influencing the market?
• Which regional market is expected to dominate the market share in the forecast period?
• Which country is likely to experience elevated growth during the forecast period?
• Who are the key players involved in the United States pharmaceutical 3PL market?
• What are the current unmet needs and challenges in the market?
• How are partnerships, collaborations, mergers, and acquisitions among the key market players shaping the market dynamics?