Indeed, logistics currently does and will continue to play an important role in the pharmaceutical industry. Due to the regulatory requirements the industry faces, logistics needs are specialized and thus high-valued. For example, the changing makeup of pharmaceuticals requires temperature-controlled storage and transport. According to FedEx, about 25 percent of all healthcare products are temperature-sensitive and by 2016, over 50 percent of the top 50 best-selling drugs will require cold-chain transportation. In fact, the U.S. is the largest cold-chain market, forecasted to grow almost 21 percent from 2013 to $3.1bn in 2017.
E-commerce is also changing the dynamics in pharmaceutical delivery. The online start-up, PillPack, coordinates with insurance and physicians and then organizes and labels medication in unique packaging. It then ships a personalized roll of pre-sorted prescriptions, vitamins and over-the-counter drugs on a set schedule wherever the consumer indicates. In mid-2015, PillPack received $50m in funding, which the company plans to use to build physical stores. This will provide consumers the option to get medicine quicker than it would be to ship from PillPack and offer a knowledgeable pharmacist at the ready.
In addition, companies such as Express Scripts will also benefit from the changing dynamics of the healthcare market. Express Scripts is a full-service pharmacy benefit management company that provides various services, including home delivery offerings. Its web services include prescription histories, online refills and comparative prices as well as information on prescription drugs, herbs and medical conditions.
The Internet of Things (IoT) has also heralded innovative ways of bringing consumers and pharmaceutical companies closer. According to a recent Capgemini study, there are approximately 1.9 billion connected devices today, which are expected to rise to 9 billion by 2018. Among available IoT innovations is Janssen’s Care4Today, an app that sends alerts to family members when someone does not take their medicines. The retail pharmacy, Walgreen’s Connect app, encourages its rewards members who own its branded blood glucose meter or blood pressure wrist monitor to take daily measurements. Users can earn points for taking the daily measurements and then use the points for store discounts.
Furthermore, as the population ages, the need for home health services will likely rise, thus creating additional opportunity for logistics and delivery providers. White glove services such as delivery, set up and maintenance of such home medical equipment as dialysis products and respiratory therapy and IV equipment will increase along with home delivery of pharmaceuticals. Logistics and delivery providers such as FedEx, UPS and SEKO Logistics are among a growing number of providers to offer solutions.
Innovative solutions are contributing to the ways an aging population manages healthcare. Much like retail’s evolution into omnichannel offerings, consumers will benefit from e-commerce in the how and where they receive prescription and over-the-counter drugs as well as for medical equipment set up, maintenance and delivery. Since specialized handling and training will be needed to handle pharmaceuticals and medical equipment, logistics and delivery providers will need to be prepared to demonstrate this know-how to set themselves apart from the competition.
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